Welcome to PCI's webinar series. Today's presentation is PCI Market Survey Results and Forecasts. My name is Nicole Clow, Marketing Coordinator at PCI, and I will be a moderator for this session. Before I turn the controls over to your presenter for today, I have a few introductory items to note. The handout for this webinar can be found in the handout section of your webinar pane. If you cannot download the handout, please email PCI Marketing at marketing at pci.org. Please note that all attendee lines are muted. The GoToWebinar toolbox has an area for you to raise your hand. If you raise your hand, you will receive a private chat message from me. If you have a question, please type it into the questions pane, where I'll be keeping track of them and will read the questions to the presenter during the Q&A period. Also, a pop up survey will appear after the webinar ends. Today's presentation will be recorded and uploaded to the PCI eLearning Center. Questions related to specific products or publications will be addressed at the end of the presentation. PCI is a registered provider of AIA CES, but today's presentation does not contain content that has been endorsed by AIA. Today's presentation is non-CEU. Our presenter for today is Brian Miller, Segment Managing Director for North America, Precast MCP, and Decorative at Criso GCP Applied Technologies. I'll now hand the controls over so we can begin our presentation. Thanks, Nicole. Can you see the screen okay? Yes, looks perfect. Excellent. Well, thank you very much. And good afternoon, everyone. And thank you also for joining us this afternoon. We have just a lot of wonderful and exciting information for you. I'm sure you're all greatly anticipating this, especially given the last couple of weeks. You will get a copy, of course, of this. So this will be posted, as we talked about earlier. So a lot of data to go through, a lot of things to cover. Hopefully no major surprises here. What we're going to do today is we'll start off taking the big look here at the national level, looking at the national forecast and kind of what that means for our industry and so forth. Well, we'll take a look at the 2021 precast sales. That comes from the last PCI market survey that was sent out. The next round collecting the 22 sales is either in progress or will be in progress very shortly. And we appreciate all the producers out there helping us with that. And then of course, we'll start a little more of a regional view here. Given the limited time we have, most of the detail at the regional level will pick up in the individual PCI regional meetings that I have the privilege of attending. But there is still a breakdown here of sales and some forecast information that we'll be able to go through today. So before we get started, we always point out a couple things, just a couple things to keep in mind. And also, of course, some things you should, I guess, consider when you're looking at the data and thinking of your business and looking at it in more detail. The first one we always point out is it's not PCI's data, it's not my data. It's just, it's just information. It's actually not that bad. So but it's just information that we're sharing with you guys. Second, keep in mind is all this, the national forecast and construction data is based on construction start. What that means is, is that the entire value of the project is put into the year in which they believe the project is going to start. And of course, we have seen some shifting and so forth. But that's not to say that the cash flow and the projects wouldn't continue on over, well, actually, probably multiple years, and in many cases, and so forth. It's also important to take a look at the trends and the magnitude of things. And this is really getting into how we define opportunities, and trying to figure out, I guess, which one of the best opportunities for us in our businesses. So just some things to look at and kind of keep this in mind. One of the calculations we do is we look at the compound annual growth rate over a period of time. In this forecast, and throughout this year, we're really looking at a four year period starting with this year, and ending in 2026. And the idea is, is this just gives you a quick idea of whether over that four year period is the segment or market that we're analyzing going to be growing or contracting. And about average each year, what kind of growth rates you'd be expected, right? This kind of set the trend, is it growing or contracting, basically, it does not mean that every year will actually be the growth or contraction rate, it's just taking a look at that holistically, and essentially kind of creating an average over that time period. So I grabbed a few here, the highest growing rate right now is actually in hotels at an average of about 14% a year, followed by or not followed by, but I included parking, of course, because it's near and dear, as I always say to us, K through 12. And warehouse, which has been on a contraction lately. And as I think many of you know, warehousing is a big part of our industry, we do a lot of that out of precast. And right now, over the next four years, we're seeing about a 15 and a half percent contraction each year, on average, like I said, across time. So if you were to rank these by the trend, you'd probably say, well, hotels is growing the most. So I should look at that parking is growing, you know, a little bit more, and K through 12 is growing and warehouse is contracting. So that's one view, that's kind of the trend side. Now, if you flip it, and you say, well, let's look at the magnitude side of things and look at the same four categories just for comparison. Well, now, K through 12 is a pretty big market, there's a lot of spend, and this is total construction dollars. So everything, not just the precast portions go in there. And over the next four years, you can see we're talking about $212 billion is projected to be spent in K through 12. Interestingly enough, hotels, even though they're growing at the fastest rate, they're only spending about $60 billion over the next four years across the country, in the hotel area. Parking's hitting about 92 and warehouse while it is contracting is sizable, isn't it? When you look at it from a magnitude standpoint, you know, 148 or roughly $150 billion, a lot of money being spent on those types of projects. So that's what we're really referring to is looking at this from different perspectives. And ultimately getting it down to, you know, what makes sense for your business. Of course, we encourage you to calculate your market share, and I explained and we'll continue to, you know, discuss the importance of looking at sales and market share in conjunction, as you build this out. And the calculation, of course, is fairly simple, you know what your sales are. So you simply divide it by the size of the market that you are participating in essentially your market. But there is an adjustment you have to make to really make it relative. Since precast concrete does not build every single aspect of the structure, right? For example, we don't usually build the windows, we might install them now at the plants, but we don't make them. We don't deal with electrical, meaning like light fixtures and carpets and elevators and all the other stuff that goes into projects. So what we do is we need to make an adjustment and it's called, we call it the strategic relative market or SRM for short. But basically it's the addressable portion of a project that could be done out of precast concrete. And that makes it very relative to what we really want to use as a calculation for market share and our true potential of the market. So by example, if we did, if we were going to do an office building, the office building had a $50 million price tag on it. And we were going to do a precast enclosure system for that structure. And these are just hypothetical numbers for an example, but say it was $6.5 million, that was the cost of the precast enclosure system. So if you simply do the math and take the 6.5 divided by the 50, you come up with 13%, which now represents the relative market potential for office buildings, enclosure systems for office buildings. This would not be total precast. This would just be the enclosure systems. So each one of you can do this and should be doing this in your area. What PCI has done is they have looked at, well, almost probably about 1000 projects now, over the past several years in analyzing this analysis, and they've come up with national SRMs and for office buildings, 13% happens to be it. And apply those to all the information that we're looking at. And again, that's what it means. So if you scale it up, and you're looking at data, and we talk about it, and you say, well, geez, this is office markets, a billion dollars of total construction, maybe in your state, that's fantastic, take 13% of it. And what that means, again, is about $130 million of office in your state could be done out of architectural or enclosure systems, I precast, that gives you a potential. And that's what you use to calculate your market share in any of these types of analysis that we discussed in here. Now, interestingly enough, when you apply the SRM, and you'll see them here in parentheses next to each one of the same four segments that we were just looking at, they start to change again, to some degree, right? So K through 12, you know, now it's at the top, and it was in terms of magnitude overall, because it's pretty large. But when you look at K through 12, and this is a total precast application, we're seeing more total precast being used in K through 12, not just for a gym, for example, but actually is the entire school itself is being built, which elevates the potential or the addressable piece of that project. And right now, the calculation is showing it's about 25% of the project. So hence, even though the $212 billion was the total construction value, it's still worth like, let's say $53 billion, just for precast over the next four years, and it has a positive growth rate. Parking, also probably one of the largest ones, parking and bridges, the largest percent of structures or SRMs that we can do, the national average runs about 44%. So you're still looking at a $40 billion or $41 billion market over the next few years. And then you see warehouse jumped down to third, you know, at one point, it was last because it was contracting, and then it was number two, based on total magnitude. But with our adjustment, and I want to highlight to this, the number here, the 10% is based actually on the enclosure system. We know that sometimes we do get lucky to do roofs and interior structure as well. That would obviously elevate the number, but just based on enclosure systems, when you run it through, I mean, it's still about a $14-15 billion market over the next few years. But again, I want to stress that it's contracting. And I'll tell the fastest growing is actually the smallest. So the point of all that is to hopefully get everybody familiar with the terminology and how to start to analyze some of the data, a lot of which we do here at PCI to try and help, so that you can make the best decisions possible. Now, a couple other things you can do, of course, you can use this to forecast, and you can even just look at that general trends. Although, again, I would, everything we just talked about, I would take into account to really have a more precise understanding of how this forecast will impact your business, growing, shrinking, what's going to happen in your area, and so forth. And then really to develop your strategy overall. I mean, our business is not a one month business. Our business is sometimes really isn't even a one year business. I mean, projects can take a couple years to develop, our cycles are longer. So it's really about where are you going to be in the next couple of years, it's kind of too late almost to deal with 2023. But you should already be thinking about 2024 and 2025, and so forth. And what changes or what direction you want to be going. And that's where you're at today is thinking, well, how do I apply this to my strategy? And when you're building your strategy, you want to take into account several key things, a lot of things, but several key things, especially related to the market, you need to understand your value proposition as a company as a precaster, what what is your value and core competencies, what are you really good at, right? Because ideally, you would align those with what makes sense in the market and with your customers. You need to understand your market position, which comes in calculation of market share, we're looking at opportunities like we're talking about today with this forecast, where are the right and big enough opportunities for you to work at. And of course, combining this with market share, which is part of the calculation. So by way of example, again, these are hypothetical, but just trying to really illustrate how this data really plays into strategy. If in your market, say you did 20 million in parking in your $50 million market, of course, that gives you a 40% market share. That's a high market share. And whenever you have a high market share, a couple things are happening. Number one, you are definitely becoming a slave to the market trend. If you have a high market share, and the market is contracting, you're going to notice that usually. And the inverse is if you get a low market share, and the market is contracting, you might not notice that it might actually be able to grow. So it works on both sides of that. But also, usually you're in a very, let's just say you're in a defensive position most of the time, because most of the people are coming after you, you're the market leader. So when you think about these questions, just to kind of put it in context, do customers know who you are? Well, probably if you're the market leader, they should connect with your value proposition, right? That would make sense on why you're the market leader. And you probably know who they are and how to market to them and communicate with them. But like I was just saying, it's really comes down to how are you going to keep your position? Because and it's not necessarily another precaster. But if it was parking, it could be the cast in place contractor GC, right? Or it could be some sort of new building development system, we're getting to a lot of hybrid systems and stuff that are coming after you and want that job, and you're the leader. So so that's how we're playing strategy. I always like to say if you flip it and really go to the opposite end of the spectrum for a minute. And again, you could use an example here, I just chose a K through 12 school and say, Look, if you just built your first one, obviously, you'd have a very, very small market share. In this example, I forget what part of the country it says, but, you know, 736 million was a potential. And, again, this would be a very small market share. But you apply those questions, the answers are going to be very different. With the customers know who you are? No, if you just started, you just did your first one, most likely, they're not even sure who you are. In fact, people you're working with might be going, Okay, we're doing it with this person, but who are they again, it takes a while to establish yourself. So that means you have to flesh out your value proposition, you have to really drive it home and communicate it, how you go into market with this information, where you reach these people, that's probably a work in process. To be honest, it takes time to develop a customer list, the target list, it takes time to know when the best ways and times to reach those customers are. So this strategy looks very different, right? And assuming that you make money at this, maybe even more money than in the other example there of parking, you might want to grow it, right? And so how are you going to grow that share, which is a very different strategy than how am I going to defend the current share that I have. And that's the point again, you know, strategy is about looking at the whole picture and really figuring out what makes the most sense in your organization to achieve the goals that you're after. And then, of course, the one I always say, why did you do it anyways? And the point here really comes down to, are we being strategic? Are we utilizing the tools and the resources and the data at our disposal, especially from PCI, like this information, to benefit our business and make the most, you know, the best strategic decisions we can? Or are we just trying to make it through? I encourage everyone always to be as strategic as possible, leverage the data, just like we do in the technical arena. You know, we do testing, we leverage data to make best decisions possible. This same thing would apply, of course, in business. So please, keeping that in mind, then let's move on into the forecast for a minute. Let's start at the national level. So the data we're looking at today is from the end of last year. It's the Q4 22 Dodge Report. That's how we get all of our, you know, high level total construction data. As I said, the projects are all based on construction starts. Here is the input data. And we started including this because it's changing all the time and stuff. But this input data gives you an idea of, okay, what's this forecast based on? What are the assumptions that are baked into it? Because obviously there's a lot of, you know, high inflation, and there's a lot of things moving quickly out there. So as you can look at all these different indicators going in, you can kind of start to get an idea of what it was based on. So for example, money, the cost of money has been going up. And you'll see at the moment they do this, they thought at the end of 23, we would be at a federal funds rate of about 4.6. We're currently I believe about 4.8. So it's in the ballpark of the cost of money. Notice going forward, they're projecting that rate to fall. Next year, it'll fall down somewhat. And then following each year afterwards, it'll continue to fall. Of course, the further out you go, the harder it gets to be to be that precise. Also look at CPI. That's the indicator of inflation. We all know 22 was a very tough year, ended up around 8%. This year, we've started to see a little bit of a slowdown or decline in inflation. I believe currently it's around 6%. At the moment, they were saying by the end of the year, it should fall all the way to 3.9%. And then note again, afterwards, in 24-25, there's a continued decrease back down to the magic 2% number of inflation. That's what the economists, which I am not, are forecasting at the moment, and that's what's baked into this type of analysis. Okay. Now, national total construction. Again, if you've heard me talk about this before, you know that these are really, really large numbers. We're talking about over a trillion dollars of construction, clearly a record you can see just back in 19, and we don't even look at 20 for the COVID purposes, but just back in 19, huge increase from then to now, way more than inflation. What we're looking at now though is, if you look at the totals down here, is we're essentially saying we're gonna be flat this year. At the last forecast in Q3, it was about 5% increase year over year, from 22 to 23. Now they're saying it's gonna be flat. It's still growing. As you look across these projections, it's absolutely still growing in very, very high numbers. But if you look at the numbers in blue, you can see the difference between the Q3 forecast and the Q4 forecast, which is essentially a slightly slowing down and some shifting, right? Instead of 7% growth in 24, we're at six. Instead of 25 being 8%, we're at five, but still a $1.2 trillion span, basically. If you analyze though in between, in the various next level down of the segments, notice housing has flattened out. We were seeing tremendous growth in there. It's projected to come back, but clearly the increase in federal funds rate and overall mortgage rates have slowed down housing. It hasn't really forced a major contraction, but they're forecasting it to be essentially the same or in the ballpark of where it was. Commercial, or should I say, excuse me, non-residential, a little bigger than commercial. Notice the big number of contraction there. Some projects have been delayed. Some projects are being shifted and moved. There's clearly been a bit of a hit in that area. That's where a lot of, of course, money is borrowed in the private sector and so forth, and that's being impacted. So you see the 10% reduction. You see it is coming back over the next few years. We're starting to see the growth again, fairly quickly getting back up there to higher numbers and so forth. So not too bad. When you look at the non-building, which is really transportation infrastructure though, some very positive numbers right now, this year, next year, still a lot of growth going on out there and a little slowing down a little bit further down the line is getting to 27. So I always say devil's in the details, right? So as we break into more detailed analysis, we'll see what segments and what areas of the country are really being impacted. So you'll have this complete list. This is the national segments breakdown from Dodge. So you kind of see where certain structures fall and where you might want to look such as stadiums are actually a part of other non-building and data centers are a part of office. And here's the segment breakdown. So same data, just looking at it now at a little bit more detailed granularity, looking at segments. So we've got bridges up there at the top. What's nice is, is as we saw earlier, bridges across this country are projected to grow at a rate of right around 6.6% a year. We're talking about 26, 27 billion this year, 29 billion next year. Some really good numbers out there. If you compare this to where we were in Q3, it was about 109 billion over the next four years. And now we're at 120. Going the right direction, not so bad. You look at parking and these are really big parking numbers. The 12 that you see over there in 20 and then the 14 before that and stuff, that's where we've been for a long time. The direction has changed, parking is growing again and we're seeing some really big numbers, $20 billion this year, about the same as last year, 22, 24. I mean, that's some big numbers. And keep in mind, not all that, actually very little of it's really due to inflation numbers as we saw earlier. It only baked in about 4% of the inflation portion of it right now. And in reality, what we're seeing is actual growth in the number of spaces technically that need to be built. So square footage. However, in the last forecast, parking was at 94 and now we've fallen to 92. So not a big drop, but something to keep in mind. Will it get impact? We saw the 10% decrease overall in let's say the non-residential buildings for the sector. And we know that parking is part of that and associated with that. So could we see further changes coming up? Quite potentially so. At the moment though, I'd say it's still fairly positive. Now, something else to keep in mind because we talk about recession and honestly, nobody knows exactly what's going to happen. We've never had quite the combination of factors that we've had over the past couple of years at the exact same time to model perfectly what's going to happen and forecast it out. I mean, it's just a reality here. And so you look at this and you're like, okay, well, do I feel good or bad here? Well, I would say this. I would say over the next four years at the moment, you have $4.7 trillion of construction. That's the biggest numbers we've ever seen. That's a very positive number. Growth rate across the country is about 5.5% averaged out per year. Just as a point of reference, if you go back to 16-19 and look at the same, similar four-year period, which was our very busiest period, okay? In 19, you'll recall the precast sales hit $6.2 billion, which is the most they've ever been. It's a record. So that's a very busy time period. Most people have really strong backlogs. We actually had some labor back then we could use. We could get the materials back then. Inflation wasn't as crazy. So we were busy. In that same time period, we only did $3.2 trillion of total construction. And if you adjust it for all the inflation we just had, you can make it 3.8. So almost a trillion dollar difference between when we were at our very busiest and now. So personally, I do believe there'll be more adjustments and contraction out there in the construction forecast and overall. But because we're so high in magnitude right now, you know, again, 4.7 trillion, it's hard to feel that we would go down so far that we would see a shortage all of a sudden. And again, this is a national perspective. This isn't exactly your state, your city perspective. But in the big picture, that'd be a hell of a lot to watch disappear. And I don't think you'll see it that bad out there. At least none of the data suggests that. Now, we also break it down by precast potential again nationally, because let's face it, this is what we could do out of precast. And in 2023, if you take the national SRMs and apply it to the value of the projects out there, you're looking at over $80 billion of precast. We do 6 billion a year, there's 80 billion potential. And you can see the breakdown across the country there. Obviously some segments are bigger. That's a lot. Remember, let me say it again. This is what could be done out of precast in 23, in 24, in 25, and going forward. So a lot of potential, it's not even all of it because we're still working on the SRM analysis for like streets and dams and flood control and power and utility, which by the way, precast is being sold into more this year than last year. So there's even higher potential than what this represents out there, but still a very strong number. The biggest one, of course, you look at bridges at about 57 billion, not too bad. A lot of bridge work over the next four years. Number two is K through 12. We talked about it earlier, about 53 billion. And number three, and this is just by order of magnitude, about 40 billion in parking. That should be exciting. Our two biggest ones is number one and number three on the entire value forecast floor. So that's a big deal. There are a lot of other ones out there though too that are also pretty big and pretty good alignment of value proposition for us as precasters. Okay, let's go into the precast sales a little bit. So look, 21 is the most recent precast sales data we had. And it hit at $5.74 billion. Just a little shy of the record, roughly down about 2% from the previous year. Construction, we know, has boomed, boomed quite well. And 22 ended up at just under $1.1 trillion in construction sales and so forth. So not too bad for us. $1.1 trillion in construction sales and so forth. So not too bad. We'll know where 22 is by summer, hopefully, or roughly mid to end of summer as we get back all the precast sales data and we can see where we ended up there. In terms of the market survey, so that's what this data is based on. We had 100% participation. So thank you again to all the producers as chair of the Market Research Committee. I really appreciate it and thank you as well as do all members in the Institute because we couldn't do it without that information. And it's become so powerful now that we pull it together and combine it with so much. We now know more about our position and the market and where we're going, where we've been and where we're going than ever before. Keep in mind, the data when sales come in are based on where projects are located. So it doesn't mean that you'll have alignment with regional data or some other indicator pointers because at the end of the day, it's where a project is built. And if a project is built in a particular state, where all the sales data goes and that's what we're reflecting here. It doesn't mean it was produced by a precaster in that state. So here's kind of how that breaks down. This is that $5.74 billion of precast sales for 2021. So in Atlantic, we organized these by just pure sales magnitude, had the most at 808 million. It was down from the previous year and you can kind of see the history there. We now have enough that we can develop some pretty good history to see how it's been over the past four years. Some ups and downs, some fluctuation. Keep in mind, a large project can always influence this. And some of these areas get some pretty large projects at one point in time. Midwest fell second, about 735. You can look across and see a pretty continuous growth on the sales in PCI Midwest. And you can see the year-over-year change there. Same for PCI Central, about 685 million of precast projects were done there. And as you look across, again, you see steady, pretty consistent growth rates as a trajectory for that particular region. And then you just kind of go down the list. You know, where are we seeing more precast being used in a particular area? Where are some dropped off maybe? You know, that we want to, what we should talk about, right? We don't want to lose ground. So, you know, what's the market doing in particular PCR regions and stuff? And this kind of gives you that breakdown. And of course, if I was still a precaster in one of these regions, it'd be really important to know. And understand my position relative to the bigger picture. Then we also look at them by segments, meaning the, again, national, all across the country, just precast sales. Parking's usually the number one. Still at about 1.6 billion of the $5.74 billion spending parking. But I do want to point out the decline there. You know, again, we fell a little bit more, roughly about 13% from 20 to 21. Warehousing is really big, and that's a concern right now. When you're doing six, seven, and $800 million in warehousing, we're excited, but keep in mind, warehousing's a market that is really contracting now. And that means that people that are heavily focused on that and have a large market share on that are probably really feeling it at this moment. And that's, you know, that's what these forecasts help us understand, hopefully a couple of years in advance. So if you think about where we're at in 25, bridges is usually up there, manufacturing, same thing, you know, large segments for us as precasters. And if you look at the CAGR, by the way, you can start to see over now this period, so we've got five years of data here. In general, are we growing or contracting? So parking we know has been contracting at a rate about 2% a year over the past five years. Warehouse grew at about 11% per year. I'm sure that number will start to be challenged as we look at the sales in 22 and 23. Bridges has been growing about 2% a year. Manufacturing has been growing just like warehouse is really large over 16%. You know, multifamily has been decreasing about four and a half or six, excuse me, 4.6% a year. K through 12 has been growing at a rate of about 9% a year. And that's good. That was an area that we've been talking about for a while. So as you look through the data, not only can you see where we're at in sales and you can see, but now that we have historic data and it's getting more and more powerful, we can start to see what's really happening over time. Are we growing or are we contracting over time? And this is just based on sales. Then we'll look at the market share side as well. So to calculate the market share nationally, this is all based on, you know, again, the PCI's National Relative Market Calculations. And of course we have to use 21 sales because that's what we have for precast sales. So we do that math. You end up looking at the potential for precast, which in 2021 was like $65 billion. By the way, remember the numbers we just looked at for 23, 24, and 25, they're much bigger than 65. I just want to point that out again, try to be the optimist here. But still 65 billion, we only did under 6 billion in 21, but 65 billion could have been done on a precast. Okay, so overall from a national perspective, when you look at it, we did about 8.8% is our market share calculation. Previously, the past couple of years have been closer to 10%. The question is, are we concerned about it? And the answer is not really. When you look at the growth of what's happened in construction, and then you couple it with what's taken place in our industry and really the world, right, over the past couple of years, it's not a surprise that we couldn't produce as much as the demand is. And I really believe that's where we're sitting now is the demand for our products is pretty high. And probably to a point we can't meet via our capacity. And capacity is not just, I mean, it's all the things we face from supply to labor. You know, we went through a pandemic. I mean, just all the things that we're dealing with that limit how much we can produce in a given year. So I think if everything was in a perfect world and you could get all the labor you wanted and you get all your supplies when you needed them, that probably would have been even higher than 10%. We'd probably be on the upswing still. So it doesn't really concern, and I wouldn't be concerned that we're sitting at about a 9% market share. That's just where we're at that year. We'll see as the next round of data comes in where we're going. However, when you look across and you look at segments, you know, Bridges is sitting in that 10% range market share, that's nice. Some of these other ones are a little bit higher. You know, it's not a surprise you look at manufacturing that you're at about 13, a little bit of a decrease there year over year. When we take a look at office, there's been some decreasing there. You know, stadiums have always been big. Parking, another one where we've seen a little bit of decrease. Now, keep in mind, if you go back previous years, you're still in the 20s, right? But unfortunately, overall, as we saw by multiple analyses, there is a serious decrease starting to happen within the way we're addressing, you want to take a look at. That kind of gives you an idea as you go through these different areas. Look at the bottom, you can see warehouses, even though the market share decreased a little bit. It'd be very interesting to see where we end up with the 2022 sales analysis when that comes in. And then we also look at it by product line as well. Again, it's all across the country, precast sales. And this is just another measurement, but it kind of lines up. You know, in 2021, our sales for the structural building and parking area are less than they were in 2020. And by the best analysis, we've been decreasing at a rate of about 5% a year. We know that we're shrinking the parking. On the other side of that coin, transportation has been increasing. And even though the sales are down, you're still growing by about 2% a year. That's fantastic, right? Architectural precast is the fastest growing, averaging over 12% a year from a product line standpoint. And that makes sense. It's not a secret anymore, I hope, that architectural precast is one of the best, if not the best building enclosure system on the planet. So getting people to understand that has been the long journey that all of us have been pushing for. And the numbers suggest we're really making the inroads there. Holocore has been a bit of a contraction, it looks like. Some of the other categories we're fleshing out as we get more information and details that enable us to get more accurate data out here and so forth. But this gives you a good idea of which categories from a product standpoint things are going, growing, shrinking, what's happening out there. Okay, now we'll switch gears a little bit and we'll dive into the region side. Again, this is a little bit limited data considering we have 12 regions and not enough time. From a big picture sales standpoint, this is all based on the latest data. Here's the PCI regional map. You can see what the projection is for total construction in 2023 and 2024 for each one of these, along with basically the current compound annual growth rate or CAGR for the next four years. If you see an underline underneath it, it's just an indicator to say the number, the magnitude of that number is smaller than it was in the Q3 forecast. It doesn't mean it was small a lot, but it means the adjustment has been, it's contracted from where it was in the previous forecast. You'll see a lot of underlines. I said earlier, there'll be some shifting. Some projects will be delayed, some things will move around. You know, certain segments will do better, other segments won't, but they're all in positive sense. You see all the CAGRs are positive. You see the numbers are still really big in each region here. If it's not underlined, we've actually have seen a shift in a different direction. So when you look at Florida, for example, you know, the $104 billion this year, or 105 basically, and the $110 billion projected for next year are both larger than they were in the last forecast. They've actually grown. And, you know, same thing for, you know, I'm looking at mountain states in 23, or I'm looking at Texas or Gulf South, all of those have grown in terms of their, basically the dollars spent in the sales area in those regions for construction sales. So there's still positives here. Now we'll start with PCI West and work our way East basically. So this will break it down by state and you get an idea of what the compound annual growth rate is for that. So two states here for California, obviously the big one in Nevada, looking at 107, still positive, shooting up to 115, then continuing into the 20s and almost reaching 130 billion. So very positive direction. In some cases I may be able to add the new 27 data, a little bit outlook out there. Notice that the compound annual growth rate when you see a green arrow, or any arrow for that matter on these, it's compared to the national data point, right? So the national growth rate was 5.5% a year. California and Nevada, PCI West, is at 6% a year. So hence it's a little bit greater than what we saw there. In terms of precast sales in California, you can go down this list. Now I broke it out by segment, starting with the largest amount of sales, which was parking at 167 million. And that's of the total at the bottom, which is about 400 and let's say 478, 479 million. This gives you the breakdown of what was sold in those two states from precast projects. Parking was one, office was second, followed by bridges, dormitories, apartments, et cetera. The percent of the second just means that out of all of the, I think it was about $1.6 billion of parking, little over 10% of it occurred in those two states in 2021. Same thing with office. Out of the entire amount of office construction in precast, 53 million of it represented 35% of all the country's precast office construction. And it occurred in 21 in PCI West. So that's how you're looking at the data. You know, overall about 8.3% of the precast projects occurred in PCI West, the value about 479 million. And the market shares, which are also there for 2021, give you a better understanding of, well, how much of what's being done is being done on the precast, right? 17% parking market share in California and Nevada. 12% market share in office, but 40% market share in dormitories. That's a really good market share, okay? It is less than the national average. The overall for them is 6.5. So you can compare that to the 8.8 national average. So it is a little bit less market share than across the country, but some of those specific segments are really, really good and really high. Let's look at Oregon and Washington. A little bit smaller region, but still running about 37, we'll say 38 to $40 billion of construction. It's growing faster than the entire country at about 6.2%. When you look in terms of market share and the analysis here, you know, other non-building projects were pretty big, followed by bridges and manufacturing and data centers. Overall representing about 152 million of the $5.7 billion of total precast construction. And, you know, market share overall of about 6%. Not too bad. A little smaller than the national average, but still not too bad. Mountain states. So mountain states is interesting. The actual mountain states area of five specific states. We've got about 60, and that's not a fluke. It really does come out to be about 61.8 and then 61.9% of the total. And 61.8, because they liked it so much, they're going to repeat it in 23 and 24. Billion dollars of construction. But notice the growth rate is slowing down a lot in that area. Wyoming is actually negative. We will have a few states that are essentially flat like Idaho and a few that are contracting like Wyoming right now. And that's what that red is indicating there. When you add Arizona in it, Arizona is on the positive side and growing pretty large. But even when you combined it together, it's still not enough to push that growth rate up over the national average. But together, you're still talking, again, there's money here, a lot of money being spent in construction. You know, Colorado, the biggest state of that area, obviously doing very well, 7% growth rate, and a lot of work still available in the specific area. From a precast sale standpoint, about 260, 259, 260 million of it occurred there. Running at about 5.6% market share in the region. Again, a little bit lower than the national average, but some of the segments, you know, very high. Religious is very high. We had data centers, government, not too bad. You know, single families even got some work going on. So it depends what sector you're looking at to see exactly, you know, how certain things are working and going. PCMA, one of the big regions again, you know, Texas, obviously a very large state, 155 billion, $170 billion construction, a little bit higher than the national average on growth rate, running about 6.2 compared to 5.5. When you look at it in terms of precast sales, 10, almost 11% of all precast was sold or installed in that area, in that region. Some very high areas there, the market share's not bad. It's 8%, a little bit, just slightly under the national average. But again, as you break into certain, you know, areas of there, parking's really big. Running about 14% market share though, even though the sales are pretty big. Bridges though, 30% market share on bridges. That's a much higher than the national average. I think the national average was 10. So obviously a huge jump up there in that particular area. Oh, excuse me, I'm sorry. The market share for bridges is 43%. I looked at the wrong number myself, which is really big compared to the national average of 10%. Looking at Midwest, still, again, big numbers there. 71 billion, 74 billion going on out there in total construction spend, going the right direction, little slower than the national average across the growth rates. South Dakota starting to show contraction. Nebraska flattening out a little bit. But most of the other states are still on the positive growth rates and trends. In terms of sales, precast sales, big numbers again, 732,000,000,000. Big numbers again, 732,000,000,000 of precast in the area. 15% market share, almost double what the national average is. So people are using precast there. I mean, that's a great thing to see, right? We love it when people use precast. Department's doing very well. Manufacturing, very high market share in the manufacturing area. K through 12, growing pretty nicely. Also very high, in fact, more than half the precast schools built in this country were built in the PCI Midwest region. That sounds like they're slowly getting the idea out there. The precast is the way to go. 26% market share in warehousing, about 17% in parking. Okay, looking at the Gulf South, about 43. This is, if I remember correctly, this is one of the areas where the construction spend was actually growing and increasing from the last forecast. So 23, 24, still running some pretty good numbers there. Little bit higher than the national average in the overall growth rates. Still the positive direction across. Little bit of slowing in Louisiana, one of the biggest market states there, but still positive. When you look at total sales, market share looks at about 8%, making up 141,000,000 precast spend in the area. And I didn't say it before, but keep in mind, as you look through these, there's two things that you'll see. The NR stands for no sales were reported, meaning no precast was used in that particular market segment. But the other one, the MNM, means minimum not met. And what that means is, is precast was sold into that segment. And it was accounted for in the national numbers and perspectives. But because we didn't meet a requirement set up so that we protect confidentiality of individual producers, it can't be disclosed in the more granular regional setting. So what that means is, is there's some numbers here, relatively small, but there's still some numbers here that aren't reflected, right? We know precast was sold there, but we can't calculate the market share in the particular region because of that. We need more work there, basically, to collect the data to do that. Okay, PCI Central, also pretty large here. Again, positive, going in the right direction, looking at 116 billion, then 122 billion next year. Slightly higher than the 5.5% growth rate. Notice that Arkansas is starting to flatten out now. A little bit of contraction. It's not contracting yet, but it'll just slow down in Indiana. Some of the other ones are still pretty positive. Ohio seems to be a little bit slower than it was originally as well. A lot, but just, you know, we'll keep a close eye on those as we go into the next forecast. Precast sells strong, a lot of segments, looking at about almost 10% in total market share across the country. Warehouses being really big, 40% market share, essentially. Parking being pretty big, about 20% share. You know, bridges manufacturing, and we know that. We know these are good segments for Precast. Illinois, Wisconsin, also positive, looking at about 7% year, or excuse me, almost 8% year over year. 40, 45, you know, billion dollars construction spend in the two states, running at about 21% market share. That's impressive. Remember, the national average was 8.8, right? So that's more than double what the national average is. And warehouses led the pack, and here's a good example where the relative market calculation I shared earlier was 10%. Obviously, there's a little bit more going on in there, and if I had to guess, there's probably more total Precast construction going into those projects that we haven't accounted for at the national level. As more projects come in, we'll be able to make adjustments in ALFR to SRMs, if you're looking at just the enclosure, or if you're looking at the total Precast structure of it, which is why that market share is so high. Manufacturing, though, really high. Again, you know, great market shares there. And some of the other ones, too, government, non-residential building, et cetera. In the Northeast, we are starting to see a little bit of slowdowns here. So you got Massachusetts, for example, they're on contraction. You know, New York is actually slowing down a little bit. The numbers used to be a lot higher there. Vermont, same thing. So your growth rate, you know, you're getting down to, it's below 2% year over year. So we are seeing a slowdown in this particular region of the country. It's still big. I mean, still talking $115 billion construction, but clearly, we want to be cognizant of some of those areas are starting to slow down a little bit, and we'll see how this starts to shift over the next year or two in terms of what's available to us. Overall, from a construction, or excuse me, from a Precast sales standpoint, so still $434 million was done there. Some very nice market shares. Overall, 5.7%, so a little bit smaller than the national, but still some decent market shares. Parking obviously being one of the biggest spends up there, apartments followed by warehousing, bridges, et cetera. Mid-Atlantic, if I remember right, this is the largest region in terms of Precast sales. And so big markets, you know, we're running $100 billion, $111 billion, about 7% growth rates. You know, nothing's contracted or negative there. We're still growing nicely. Maryland's slowing down a little bit, but the other areas seem to be pretty strong still, especially Virginia is looking good. Pennsylvania is still looking good. You know, some of the big markets there. About over $800 million of Precast construction there with parking being the biggest. Noticing that about 19, came near 20% of all parking built was built in the PCI Mid-Atlantic region, and they hold a 37% market share. So again, the national market share for parking had fallen down to just under 23%. Here it's still holding up at about 37%, you know, followed by warehousing again, data centers, and a few other ones here. And as we discussed earlier, the warehouses being high is not uncommon for us, but it is a little concerning knowing that there's major contractions starting to happen in that particular segment. George Carolina's still doing pretty well, again, 94 billion, 102 billion growth rate, running at about 8%, much higher than the national average. All states are looking pretty solid over the next few years. Precast sales have slowed down a little bit. Remember the exact numbers, but there's been a little less down to that 455 million we're looking at now, but still a very high market share. You know, in those states still running about 10.7, so it's over the national average of market share. And keep in mind, we're all in these conditions, right, that we talked about earlier. As a country, we're all in those conditions facing those challenges, so still pretty good. And some of those are pretty high market shares up there. I mean, look at parking at 58%. That's a really impressive number or market share percent, but it also means that anyone trying to do parking there is looking at how to get that market share away from us as precasters. So we definitely have to be cognizant of that. And then finally, Florida, the easiest state for me to do the analysis on because it's one state. Sitting there at about 105, $110 billion construction. Lower and slowing down. The magnitudes are obviously good, but the rates are starting to slow down. In terms of sales, pretty respectable, right? Parking being the largest. We're running 194 million followed by bridges, apartments. Power utility, like I said, we see some of these other categories and there's a lot of work happening just trying to get all the data so we can calculate market share. And the market share of parking is pretty good at 30%. Overall for the state, over 9%. Not too bad. And what we did is we include kind of this master chart because really everything is relative in some way. When you see a number, any number, is it good or bad? And it helps to try and take a look at, okay, well, how do I make this comparable to the national average? Or how do I make it and take a look at what's happening in other regions and stuff? So this breaks it down. This gives you a look by PCI region and segment. Where are the market shares based on 2021 data? Now, where are the market shares in the regions? It looks like the largest one, just scanning the bottom there, is actually Illinois, Wisconsin at over 21% market share, followed by, looks like the Midwest. Keep in mind, the national average is only 8.8%. And then you can break down and take a look in the various segments and so forth as well. I think our highest parking market share appears to be actually in the Gulf South. So hats off to you guys because you're pretty much any parking structure you seem to get, which is great. We want to be that way everywhere if we can, right? So you'll have this to do some analysis and comparisons on. And then in summary, I guess what I would just share is look at all the data, and we get a lot of data now that we're looking at. Inflation is starting to slow. It's probably not nearly as fast as not, but it is starting to slow down. And there's definitely a feeling of recession around the country, depending on what segments, what areas, who you want to talk to this week and so forth. Nobody knows for sure. But the data suggests, and it is, the outlook is still very strong. Like I said earlier, even if there was a 10% contraction across the board of constructions, we actually saw negative numbers everywhere. To the magnitude of 10%, we would still be messing around with $950 to $1 trillion of construction. Way more construction than we could handle when we had everything perfect out there. Now that doesn't mean we don't have to go after things, right? That doesn't mean we have to think a little differently and maybe approach things a little differently. So how you do that, where you are, what segments you focus on, what states can tell a different story. And as you start to dig in, they're not all the same. But obviously encourage everyone to take advantage of this data. Use this data like you can to make the best decisions possible. There's a lot of opportunity out there if we can adjust and go after it and so forth. And Precast has that strong value proposition, one of the strongest. So we've communicated, leverage it, and we'll take advantage of it to do well in our industry. So Nicole, I don't know if you're out there. I think we're reasonably on time. We are. So thank you, Brian, for a great and informative presentation. I haven't seen any questions come through, but I will give it about 10 seconds to see if one does. Good. And yeah, Nicole, anyone can email me or call me. Usually when you get the data, you might be able to look a little bit longer at your particular area, state, region, et cetera. Feel free to reach out anytime with questions. Happy to help and dive in a little bit deeper. Sounds great. Thank you. So no, I do not see any questions coming through. So on behalf of PCI, I would like to thank Brian for a great presentation. If you do have any questions about today's webinar, please email Brian Miller with his email on the screen or marketing at pci.org. Thank you again. Have a great day and please stay safe.

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PCI Market Survey Results

construction market

precast concrete industry

national forecast

parking

bridges

warehouses

market share data