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Martin Marietta refers you to the legal disclaimers contained in our press release, relating to our second quarter, 2012 results, and to Martin Marietta's other filings with the Securities and Exchange Commission, which can be found on the SEC's website. Finally, any references in our discussion to margin are based on net sales, excluding freight and delivery revenues. This is also explained in our SEC filings.For the second consecutive quarter, our Heritage Aggregates business has reported an increase in operating margin, expanding 150 basis points in the second quarter 2012. This expansion was driven by our Heritage Aggregates product line, which reported a 2.8% increase in shipments; and a 2.4% increase in pricing. Underscoring this performance, are signs of recovery in certain of our markets, predominately in the western United States. These trends, along with the recent passage of a multi-year federal highway bill, and regionalised improvement in home building, have provided optimism for future construction activities. We also continue to be pleased with our specialty products business, which established a new second quarter record for net sales, and once again, generated impressive margins. The volume momentum generated in the first quarter, for our Heritage Aggregated product line shipments, continued into April and May. In fact, Heritage shipments for the two month period ended May 31, increased 8% over the comparable prior year period. In that volume environment, we generated an incremental gross margin consistent with our expectations. Predictably, in markets with more notable volume growth, we generated an incremental gross margin much higher than 60%. As an example, our Des Moines, Iowa district experienced a 16% shipment increase for this two month period; and generated an incremental gross margin of 75%. However, in June, certain project delays and economic uncertainty led to a 5 1/2% decline, in Heritage shipments compared with June 2011.
This erratic volume pattern, together with planned inventory control measures; diluted the incremental gross margin gains, that were achieved in the first two months of the quarter. We see consistent indications of recovery in our West group, which reported a 7.6% volume increase for the quarter. Shipments were notably strong in Texas, and Iowa. The Texas market experienced robust construction activity, including increased shipments to both the energy spectrum, as well as the residential end use markets.Our mid-west division, particularly Iowa, benefited from mild winter weather, which facilitated to an earlier start to the construction season, and allowed for significant progress on several projects. Including the expansion of Highway 20, also known as the Midwest Connector, in western Iowa. Heritage Aggregates volume in our mid-east group increased nearly 8% for the two month period ended May 2012, as compared to the prior year; driven by strength in our Indiana and Ohio markets for major highway projects. However, June volumes declined over 4%. Primarily as a result of project delays in North Carolina, which are expected to defer certain shipments to the second half of the year. Overall, our mid-east group reported a 2.9% increase in Heritage Aggregates product line shipments for the quarter. Our south-east group experienced a 10% decline in Heritage Aggregate product line shipments, due to economic conditions, lagging national trends, which is largely attributable to weak job growth and continued high foreclosure rates. We're pleased that three out of four of our end-use markets reported Heritage Aggregates product-line volume growth. Shipments to our Heritage infrastructure market increased 3% over the prior quarter. This end use, which accounts for more than half of our aggregates product line shipments, should benefit in the future from the recent passage of the Moving Ahead for Progress in the 21st century act, or MAP 21; which is signed into law earlier this month.
MAP 21 is essentially a final three month continuing resolution to the previous highway bill, through September 30; followed by an abbreviated two year highway program. We believe the new law, which provides highway expenditures of $40 billion annually, will create a higher degree of fiscal certainty for states, counties, and municipalities; compared with a series of shorter-term continuing resolution in effect, since 2009. Furthermore, MAP 21 provides for expedited project approvals, eliminates ear marks and embraces more private sector involvement, all of which we believe will be positive for our business. Aggregates product-line shipments to our residential end-use market, increased 8% in the prior year quarter.Read the rest of this transcript for free on seekingalpha.com