J. Thomas Hill
Chairman of the Board and Chief Executive Officer at Vulcan Materials
Thank you, Mark, and thank all of you for joining our call this morning. In September, we officially surpassed our prior goal of $9 per ton cash gross profit on a trailing 12-month basis, and that was before reaching the 230 million tons on a same-store basis and despite macro challenges over the past four years that none of us likely anticipated back in the fall of 2019 when we initially set that target. This accomplishment perfectly demonstrates the durability of our aggregates-led business, and I'm really proud of how our teams continue to execute at a high level.
Compounding profitability through the solid execution of our Vulcan Way of Selling and Vulcan Way of Operating strategic disciplines is at the core of who we are across our coast-to-coast footprint. Today, our teams are intensely focused on our new target of $11 to $12 of cash gross profit per ton. Cash gross profit per ton growth is key to increasing our free cash flow and continuing to create value for our shareholders. In the quarter, we generated $602 million of adjusted EBITDA, which is a 19% improvement over the prior year. Our aggregates, asphalt and concrete product lines all posted another quarter of year-over-year gross margin improvement.
In the aggregates segment gross margin expanded by 200 basis points and cash gross profit per ton improved by 18% despite lower volumes. Shipments declined 2% in the quarter with variations across end uses and geographies. Residential weakness impacted the majority of our markets, while at the same time many of our markets are seeing improving momentum in highway shipments.
Private non-residential construction activity related to large industrial and manufacturing projects continue to drive healthy volume growth, particularly in Georgia and the Carolinas. Remember, footprint matters in the aggregates business. Ours is unmatched in the Southeast, where private demand dynamics are currently strongest, and across the country in states where IIJA investments will be the most significant. Pricing momentum continued across our footprint, with all geographies achieving healthy year-over-year increases. Average selling prices improved 15% in the quarter and 3% sequentially, more than offsetting continued inflationary cost pressures.
In asphalt, gross margin improved 660 basis points. Shipments increased 11% and across most geographies with particular strength in California. Average selling prices improved 2% and cash unit profitability improved over 50%, benefiting from lower liquid asphalt costs and solid manufacturing cost control.
Concrete gross margins improved 120 basis points. Cash unit profitability improved by over 30%, despite lower volume that continued to be impacted by the slowdown in residential construction activity. Remember, prior year concrete segment earnings benefited from the contribution of the now divested New York, New Jersey and Pennsylvania concrete operations. Through the first nine months of the year, we have executed well and successfully navigated evolving macro dynamics.
Let me comment briefly on what we are currently seeing in each end use. Starting with residential, we are encouraged by the recent growth in single-family permits and starts in many geographies over the last three months. On the other hand, after providing some support for overall residential demand, multi-family starts have now begun to pull back from historically high levels. Affordability and higher mortgage rates are likely to continue to have some impact on residential activity, but the underlying fundamentals remain firmly in place. Vulcan markets have low housing inventory levels and favorable demographics, driving the need for additional housing.
In private non-residential construction, trends differ across categories. As expected, warehouse activity, the largest non-res category, has softened, but manufacturing activity remains at high levels and is concentrated in Vulcan states. We have booked and are shipping on numerous large manufacturing projects where we offer customers a differentiated solution with our advantaged footprint and logistics capabilities.
On the public side, leading indicators remain supportive of continued growth in both highway and infrastructure. Trailing 12-month highway starts are up 18% and 2024 state budgets are at record levels. We continue to expect accelerating growth in public construction activity into next year and continue growth for the next several years. Our nimble sales and operating teams are well prepared to deliver value for our customers in any demand environment and to continue to improve unit profitability and drive value for our shareholders.
Now, I'll turn the call over to Mary Andrews for some additional commentary on our third quarter performance and upgraded 2023 outlook. Mary Andrews?
