In November 2011 we entered into a joint venture agreement with Ratliff Ready-Mix, L.P., a ready-mix operator based in Waco, Texas. We contributed seven of our central Texas ready-mix plants and certain related assets to the joint venture and guaranteed 50%, or $13.0 million of the debt of the joint venture's debt which matures November 18, 2013. In addition to our 50% guarantee of the joint venture's debt, 100% of the debt is guaranteed by the other partner and secured by the underlying assets of the joint venture. The joint venture was in compliance with all the terms of the debt as of November 30, 2012. The day to day business operations are managed by the 60% partner in the venture. The joint venture owns a total of twenty three ready-mix plants and serves the central Texas market. We supply cement to the joint venture. The joint venture operations are reported in our consumer products segment using the equity method of accounting.
Consolidated net sales for the three-month period ended November 30, 2012 were $167.7 million, an increase of $21.5 million from the prior year period. Consolidated cost of products sold for the three-month period ended November 30, 2012 was $155.9 million, an increase of $11.2 million from the prior year period. Increased sales were primarily due to higher shipments for all major products and higher average price in aggregates and consumer products. Increase in cost of products sold is primarily due to cost associated with higher shipments and cement repair and maintenance costs. Consolidated gross profit for the three-month periods ended November 30, 2012 and November 30, 2011 was $11.8 million and $1.5 million, respectively.
Consolidated net sales for the six-month period ended November 30, 2012 were $342.2 million, an increase of $28.4 million from the prior year period. Consolidated cost of products sold for the six-month period ended November 30, 2012 was $315.3 million, an increase of $13.6 million from the prior year period. Increased sales were primarily due to higher cement and aggregates shipments and higher average price in aggregates and consumer products. Increase in cost of products sold is primarily due to cost associated with higher shipments and cement repair and maintenance costs. Consolidated gross profit for the six-month periods ended November 30, 2012 and November 30, 2011 was $27.0 million and $12.1 million, respectively.
Consolidated restructuring charges of $3.2 million were recorded in the three-month and six-month periods ended November 30, 2011, of which $1.6 million was paid. These charges consist primarily of severance and benefit costs associated with the various workforce reduction initiatives.

Consolidated selling, general and administrative expense for the three-month period ended November 30, 2012 was $17.1 million, an increase of $4.3 million from the prior year period. Our stock-based compensation includes awards expected to be settled in cash, the expense for which is based on their fair value at the end of each period until the awards are paid. The impact of changes in our stock price on the fair value of these awards increased expense $4.3 million from the prior year period.
Consolidated selling, general and administrative expense for the six-month period ended November 30, 2012 was $34.6 million, an increase of $5.1 million from the prior year period. Our stock-based compensation includes awards expected to be settled in cash, the expense for which is based on their fair value at the end of each period until the awards are paid. The impact of changes in our stock price on the fair value of these awards increased expense $7.1 million from the prior period. This increase was offset by $2.0 million decrease in controllable expenses.
Consolidated other income for the three-month period ended November 30, 2012 was $1.9 million, an increase of $0.4 million from the prior year period. Other income includes earnings from a joint venture of $0.5 million in the three-month period ended November 30, 2012.
Consolidated other income for the six-month period ended November 30, 2012 was $4.5 million, a decrease of $2.9 million from the prior year period. The July 2011 asset exchange resulted in the recognition of a gain of $2.1 million in the six-month period ended November 30, 2011.
Net Income from discontinued operations for the three-month period ended November 30, 2012 was $0.8 million, an increase of $0.7 million from the prior year on higher shipments from expanded shale and clay lightweight aggregates. Net Income from discontinued operations for the six-month period ended November 30, 2012 was $5.9 million, an increase of $3.6 million from the prior year period on higher shipments from expanded shale and clay lightweight aggregates. Total segment operating profit for the three month period ended November 30, 2012 was $6.9 million. Total segment operating loss for the three-month period ended November 30, 2011 was $6.9 million. Total segment operating profit was $17.5 million for the six-month period ended November 30, 2012. Total segment operating loss was $1.0 million for the six-month period ended November 30, 2011.
The following is a summary of operating results for our business segments and certain other information related to our principal products and non-operating expenses.

Cement Operations

                                         Three months ended          Six months ended
                                            November 30,               November 30,
In thousands except per unit             2012          2011         2012          2011
Operating Results
Cement sales                          $  82,584     $ 68,994     $ 169,897     $ 144,972
Other sales and delivery fees             8,858        8,240        18,750        17,899
Total segment sales                      91,442       77,234       188,647       162,871
Cost of products sold                    82,706       78,050       168,825       156,282
Gross profit                              8,736         (816 )      19,822         6,589
Selling, general and administrative      (3,729 )     (4,165 )      (7,273 )      (8,243 )
Restructuring charges                         -       (1,074 )           -        (1,074 )
Other income                              1,050          700         1,930         3,890
Operating Profits                     $   6,057     $ (5,355 )   $  14,479     $   1,162
Cement
Shipments (tons)                          1,034          884         2,153         1,853
Prices ($/ton)                        $   79.82     $  78.07     $   78.91     $   78.25
Cost of sales ($/ton)                 $   72.56     $  78.34     $   70.47     $   74.90

Three months ended November 30, 2012
Cement operating profit (loss) for the three-month periods ended November 30, 2012 and November 30, 2011 was $6.1 million and $(5.4) million, respectively. Total segment sales for the three-month period ended November 30, 2012 were $91.4 million compared to $77.2 million for the prior year period. Cement sales increased $14.2 million from the prior year period. Our Texas market area accounted for approximately 69% of cement sales in the current period compared to 67% of cement sales in the prior year period. Average cement prices increased 3% in our Texas market from the prior year period. Average cement prices decreased less than 1% due to a change in product mix in our California market from the prior year period. Shipments increased 19% in our Texas market area and 13% in our California market area.
Cost of products sold for the three-month period ended November 30, 2012 increased $4.7 million from the prior year period primarily due to higher shipments. Cement unit cost of sales decreased 7% from prior year period primarily due to higher shipments and lower energy costs offset slightly by higher maintenance costs.
Selling, general and administrative expense for the three-month period ended November 30, 2012 decreased $0.5 million from the prior year period primarily due to our work force reduction initiatives.
Restructuring charges of $1.1 million were recorded in the three-month period ended November 30, 2011. These charges consist primarily of severance and benefit costs associated with various workforce reduction initiatives. Other income for the three-month period ended November 30, 2012 increased $0.3 million from the prior year period primarily due to higher royalties. Six months ended November 30, 2012
Cement operating profit for the six-month periods ended November 30, 2012 and November 30, 2011 was $14.5 million and $1.2 million, respectively.
Total segment sales for the six-month period ended November 30, 2012 were $188.6 million compared to $162.9 million for the prior year period. Cement sales increased $25.7 million from the prior year period. Our Texas market area accounted for approximately 68% of cement sales in the current period compared to 67% of cement sales in the prior year period. Average cement prices increased 3% in our Texas market from the prior year period. Average cement prices decreased 4% due to a change in product mix in our California market from the prior year period. Shipments increased 15% in our Texas market area and 19% in our California market area.

Cost of products sold for the six-month period ended November 30, 2012 increased $12.5 million from the prior year period primarily due to higher shipments. Cement unit cost of sales decreased 6% from prior year period primarily due to higher shipments.
Selling, general and administrative expense for the six-month period ended November 30, 2012 decreased $1.0 million from the prior year period primarily due to our work force reduction initiatives.
Restructuring charges of $1.1 million were recorded in the six-month period ended November 30, 2011. These charges consist primarily of severance and benefit costs associated with various workforce reduction initiatives. Other income for the six-month period ended November 30, 2012 decreased $2.0 million from the prior year period. The sales of emission credits associated with our Crestmore cement plant in Riverside, California resulted in gain of $2.5 million in the six-month period ended November 30, 2011.

Aggregates Operations

                                         Three months ended         Six months ended
                                            November 30,              November 30,
In thousands except per unit             2012          2011         2012         2011
Operating Results
Stone, sand and gravel sales          $  27,739     $ 20,993     $ 55,890     $ 43,193
Delivery fees                            12,473        7,854       25,302       15,971
Total segment sales                      40,212       28,847       81,192       59,164
Cost of products sold                    35,951       25,459       72,188       52,378
Gross profit                              4,261        3,388        9,004        6,786
Selling, general and administrative        (856 )     (1,226 )     (1,864 )     (3,102 )
Restructuring charges                         -         (373 )          -         (373 )
Other income                                115          202          378          473
Operating Profit                      $   3,520     $  1,991     $  7,518     $  3,784
Stone, sand and gravel
Shipments (tons)                          3,808        2,818        7,722        5,961
Prices ($/ton)                        $    7.28     $   7.45     $   7.24     $   7.25
Cost of sales ($/ton)                 $    5.99     $   6.35     $   5.99     $   6.28

Previously, the aggregates segment included our expanded shale and clay lightweight aggregates which has been classified as discontinued operations in the current period and all prior periods. Therefore, amounts for these operations are not included in the information presented.

On December 4, 2012, our subsidiaries entered into agreements to exchange their expanded shale and clay lightweight aggregates manufacturing business for the ready-mix concrete business of subsidiaries of Trinity Industries, Inc. in east Texas and southwest Arkansas. Pursuant to the agreements, we will transfer our expanded shale and clay manufacturing facilities in Streetman, Texas; Boulder, Colorado and Frazier Park, California; and our DiamondProŽ product line in exchange for 42 ready-mix concrete plants stretching from Texarkana to Beaumont in east Texas and in southwestern Arkansas, as well as 2 aggregate distribution facilities in Beaumont and Port Arthur, Texas, and related assets. We anticipate recognizing a gain on the transaction, the amount of which will be determined after the transaction closes. Closing is subject to negotiations of ancillary agreements, satisfactory completion of due diligence, receipt of required consents, approvals and permit amendments and other customary conditions. Three months ended November 30, 2012
Aggregates operating profit for the three-month periods ended November 30, 2012 and November 30, 2011 was $3.5 million and $2.0 million, respectively. Total segment sales for the three-month period ended November 30, 2012 were $40.2 million compared to $28.8 million for the prior year period. Stone, sand and gravel sales increased $6.7 million from the prior year period on 35% higher shipments.

Cost of products sold for the three-month period ended November 30, 2012 increased $10.5 million from the prior year period primarily due to increased stone, sand and gravel shipments. Stone, sand and gravel unit costs decreased 6% from the prior year period primarily due to the effect of higher shipments on unit costs.
Selling, general and administrative expense for the three-month period ended November 30, 2012 decreased $0.4 million from the prior year period primarily due to our work force reduction initiatives.
Restructuring charges of $0.4 million were recorded in the three-month period ended November 30, 2011. These charges consist primarily of severance and benefit costs associated with various workforce reduction initiatives. Six months ended November 30, 2012
Aggregates operating profit for the six-month periods ended November 30, 2012 and November 30, 2011 was $7.5 million and $3.8 million, respectively. Total segment sales for the six-month period ended November 30, 2012 were $81.2 million compared to $59.2 million for the prior year period. Stone, sand and gravel sales increased $12.7 million from the prior year period on 30% higher shipments.
Cost of products sold for the six-month period ended November 30, 2012 increased $19.8 million from the prior year period primarily due to increased stone, sand and gravel shipments. Stone, sand and gravel unit costs decreased 5% from the prior year period primarily due to the effect of higher shipments on unit costs. Selling, general and administrative expense for the six-month period ended November 30, 2012 decreased $1.2 million from the prior year period primarily due to our work force reduction initiatives.
Restructuring charges of $0.4 million were recorded in the six-month period ended November 30, 2011. These charges consist primarily of severance and benefit costs associated with various workforce reduction initiatives.

Consumer Products Operations

                                              Three months ended          Six months ended
                                                 November 30,               November 30,
In thousands except per unit                  2012          2011         2012          2011
Operating Results
Ready-mix concrete sales                   $  52,776     $ 44,579     $ 104,694     $ 100,807
Package products sales and delivery fees         101       13,542           228        28,338
Total segment sales                           52,877       58,121       104,922       129,145
Cost of products sold                         54,123       59,212       106,796       130,409
Gross loss                                    (1,246 )     (1,091 )      (1,874 )      (1,264 )
Selling, general and administrative           (2,074 )     (2,436 )      (4,764 )      (6,810 )
Restructuring charges                              -         (536 )           -          (536 )
Other income                                     713          457         2,123         2,664
Operating Loss                             $  (2,607 )   $ (3,606 )   $  (4,515 )   $  (5,946 )
Ready-mix concrete
Shipments (cubic yards)                          643          587         1,292         1,328
Prices ($/cubic yard)                      $   81.99     $  75.85     $   81.03     $   75.89
Cost of sales ($/cubic yard)               $   84.16     $  80.66     $   82.56     $   79.69

Three months ended November 30, 2012
Consumer products operating loss for the three-month periods ended November 30, 2012 and November 30, 2011 was $2.6 million and $3.6 million, respectively. Total segment sales for the three-month period ended November 30, 2012 were $52.9 million compared to $58.1 million for the prior year period. Segment sales decreased $5.2 million from the prior year period due to the effect of exiting the Houston, Texas ready-mix market and the sale of our Texas-based package products operations. Ready-mix concrete sales from ongoing operations increased $8.2 million from the prior year period on 9% higher shipments and 8% higher average prices.
Cost of products sold for the three-month period ended November 30, 2012 decreased $5.1 million from the prior year period primarily due to the sale of our Texas-based package products operation and having exited the Houston ready-mix

market. Ready-mix concrete unit costs increased 4% from the prior year period on higher maintenance, diesel and material costs.
Selling, general and administrative expense for the three-month period ended November 30, 2012 decreased $0.3 million from the prior year period primarily due to the effect of the sale of our Texas-based package products operations and our work force reduction initiatives.
Restructuring charges of $0.5 million were recorded in the three-month period ended November 30, 2011. These charges consist primarily of severance and benefit costs associated with various workforce reduction initiatives. Other income for the three-month period ended November 30, 2012 increased $0.3 million from the prior year period primarily due to earnings from joint venture of $0.7 million.
Six months ended November 30, 2012
Consumer products operating loss for the six-month periods ended November 30, 2012 and November 30, 2011 was $4.5 million and $5.9 million, respectively. Total segment sales for the six-month period ended November 30, 2012 were $104.9 million compared to $129.1 million for the prior year period. Segment sales decreased $24.2 million from the prior year period due to the effect of exiting the Houston, Texas ready-mix market and the sale of our Texas-based package products operations. Ready-mix concrete sales increased $3.9 million from the prior year period on 7% higher average prices against 3% lower shipments. Cost of products sold for the six-month period ended November 30, 2012 decreased $23.6 million from the prior year period primarily due to the sale of our Texas-based package products operation and having exited the Houston ready-mix market. Ready-mix concrete unit costs increased 4% from the prior year period on higher material and diesel costs.
Selling, general and administrative expense for the six-month period ended November 30, 2012 decreased $2.0 million from the prior year period primarily due to the effect of the sale of our Texas-based package products operations and our work force reduction initiatives.
Restructuring charges of $0.5 million were recorded in the six-month period ended November 30, 2011. These charges consist primarily of severance and benefit costs associated with various workforce reduction initiatives. Other income for the six-month period ended November 30, 2012 decreased $0.5 million from the prior year period. Earnings from the joint venture of $1.1 million were recognized in the six-month period ended November 30, 2012. Gain of $2.1 million from the disposition of the Houston ready-mix operations was recognized in the six-month period ended November 30, 2011. Excluding these items, other income increased $0.4 million dollars from the prior year period due to miscellaneous sales.

Corporate

                                         Three months ended          Six months ended
                                            November 30,               November 30,
In thousands                             2012          2011         2012          2011
Other income                          $      46     $    163     $      92     $     366
Selling, general and administrative     (10,405 )     (4,953 )     (20,718 )     (11,355 )
Restructuring charges                         -       (1,169 )           -        (1,169 )
                                      $ (10,359 )   $ (5,959 )   $ (20,626 )   $ (12,158 )

Three months ended November 30, 2012
Other income for the three-month period ended November 30, 2012 decreased $0.1 million from the prior year period primarily due to lower oil and gas royalty payments.
Selling, general and administrative expense for the three-month period ended November 30, 2012 increased $5.5 million from the prior year period. Stock-based compensation includes awards expected to be settled in cash, the expense for which is based on their fair value at the end of each period until the awards are paid. The impact of changes in our stock price on the fair value of these awards increased expense $4.3 million for the three-month period ended November 30, 2012 and the realignment of administration functions resulted in approximately $1.0 million higher expense, which was more than offset by the savings from the work force reduction in the operating segments.

Restructuring charges of $1.2 million were recorded for the three-month period ended November 30, 2011. These charges consist primarily of severance and benefit costs associated with various workforce reduction initiatives. Six months ended November 30, 2012
Other income for the six-month period ended November 30, 2012 decreased $0.3 million from the prior year period primarily due to lower oil and gas royalty payments.
Selling, general and administrative expense for the six-month period ended November 30, 2012 increased $9.4 million from the prior year period. Stock-based compensation includes awards expected to be settled in cash, the expense for which is based on their fair value at the end of each period until the awards are paid. The impact of changes in our stock price on the fair value of these awards increased expense $7.1 million for the six-month period ended November 30, 2012 and the realignment of administration functions resulted in approximately 2.0 million higher expense.
Restructuring charges of $1.2 million were recorded for the six-month period ended November 30, 2011. These charges consist primarily of severance and benefit costs associated with various workforce reduction initiatives. Interest
Interest expense incurred for the three-month period ended November 30, 2012 was $17.4 million, of which $9.9 million was capitalized in connection with our Hunter, Texas cement plant expansion project and $7.5 million was expensed. Interest expense incurred for the three-month period ended November 30, 2011 was $17.1 million, of which $8.3 million was capitalized in connection with our Hunter, Texas cement plant expansion project and $8.8 million was expensed. Interest expense incurred for the six-month period ended November 30, 2012 was $34.4 million, of which $19.2 million was capitalized in connection with our Hunter, Texas cement plant expansion project and $15.2 million was expensed. Interest expense incurred for the six-month period ended November 30, 2011 was $34.4 million, of which $16.1 million was capitalized in connection with our Hunter, Texas cement plant expansion project and $18.3 million was expensed. Interest expense to be capitalized in connection with our Hunter, Texas cement plant expansion project during the remainder of our current fiscal year is expected to be between $11 million and $17 million. Income Taxes
Income taxes for the interim periods ended November 30, 2012 and November 30, 2011 have been included in the accompanying financial statements on the basis of an estimated annual rate. The tax rate differs from the 35% federal statutory corporate rate primarily due to percentage depletion that is tax deductible, state income taxes and valuation allowances against deferred tax assets. The estimated annualized rate for continuing operations is 4.3% for fiscal year 2013 . . .