Apogee Reports Improved FY2013 Third-Quarter Earnings

“I believe that our focus on operational improvements as well as our strategies to grow through new geographies, new products and new markets will allow Apogee to continue to deliver improving results,” Puishys said.

TELECONFERENCE AND SIMULTANEOUS WEBCASTApogee will host a teleconference and webcast at 10 a.m. Central Time tomorrow, December 19. To participate in the teleconference, call 1-866-700-0133 toll free or 617-213-8831 international, access code 48406378. The replay will be available from noon Central Time on December 19 through midnight Central Time on Friday, January 4, 2013, by calling 1-888-286-8010 toll free, access code 50338821. To listen to the live conference call over the internet, go to the Apogee web site at http://www.apog.com and click on “investor relations” and then the webcast link at the top of that page. The webcast also will be archived on the company’s web site.

ABOUT APOGEE ENTERPRISESApogee Enterprises, Inc., headquartered in Minneapolis, is a leader in technologies involving the design and development of value-added glass products and services. The company is organized in two segments:

• Architectural products and services companies design, engineer, fabricate, install and renovate the walls of glass and windows comprising the outside skin of commercial and institutional buildings. Businesses in this segment are: Viracon, the leading fabricator of coated, high-performance architectural glass for global markets; Harmon, Inc., one of the largest U.S. full-service building glass installation and renovation companies; Wausau Window and Wall Systems, a manufacturer of custom aluminum window systems and curtainwall; Tubelite, a fabricator of aluminum storefront, entrance and curtainwall products; and Linetec, a paint and anodizing finisher of window frames and PVC shutters.
• Large-scale optical segment consists of Tru Vue, a value-added glass and acrylic manufacturer for the custom picture framing market.

USE OF NON-GAAP FINANCIAL MEASURESIn addition to financial measures prepared in accordance with generally accepted accounting principles (GAAP), this news release also contains non-GAAP financial measures. Specifically, Apogee has presented free cash flow and non-cash working capital. Free cash flow is defined as net cash flow provided by operating activities, minus capital expenditures. Non-cash working capital is defined as current assets, excluding cash and short-term investments, less current liabilities. Apogee believes that use of these non-GAAP financial measures enhances communications as they provide more transparency into management’s performance with respect to cash and current assets and liabilities. Non-GAAP financial measures should be viewed in addition to, and not as an alternative to, the reported operating results or cash flows from operations or any other measure of performance prepared in accordance with GAAP.

FORWARD-LOOKING STATEMENTSThe discussion above contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements reflect Apogee management’s expectations or beliefs as of the date of this release. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. All forward-looking statements are qualified by factors that may affect the operating results of the company, including the following: operational risks within (A) the architectural segment: i) competitive, price-sensitive and changing market conditions, including unforeseen project delays and cancellations; ii) economic conditions, material cost increases and the cyclical nature of the North American and Latin American commercial construction industries; iii) product performance, reliability, execution or quality problems that could delay payments, increase costs, impact orders or lead to litigation; and iv) the segment’s ability to fully and efficiently utilize production capacity; and (B) the large-scale optical segment: i) markets that are impacted by consumer confidence and trends; ii) dependence on a relatively small number of customers; iii) changing market conditions, including unfavorable shift in product mix and new competition; and iv) ability to fully and efficiently utilize production capacity. Additional factors include: i) revenue and operating results that are volatile; ii) financial market disruption which could impact company, customer and supplier credit availability; iii) self-insurance risk related to a material product liability event and to health insurance programs; iv) cost of compliance with governmental regulations relating to hazardous substances; and v) foreign currency risk related to certain continuing operations. The company cautions investors that actual future results could differ materially from those described in the forward-looking statements, and that other factors may in the future prove to be important in affecting the company’s results of operations. New factors emerge from time to time and it is not possible for management to predict all such factors, nor can it assess the impact of each such factor on the business or the extent to which any factor, or a combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. For a more detailed explanation of the foregoing and other risks and uncertainties, see Item 1A of the company’s Annual Report on Form 10-K for the fiscal year ended March 3, 2012.

Apogee Enterprises, Inc. & Subsidiaries
Consolidated Condensed Statement of Income
(Unaudited)
Dollar amounts in thousands, except for per share amounts			Thirteen		Thirteen							Thirty-nine		Thirty-nine
			Weeks Ended		Weeks Ended			%				Weeks Ended		Weeks Ended			%
			December 1, 2012		November 26, 2011			Change				December 1, 2012		November 26, 2011			Change
Net sales			$190,416		$174,853			9%				$520,490		$493,748			5%
Cost of goods sold			148,176		140,125			6%				411,038		409,383			0%
Gross profit			42,240		34,728			22%				109,452		84,365			30%
Selling, general and administrative expenses			30,829		27,572			12%				88,170		83,314			6%
Operating income			11,411		7,156			59%				21,282		1,051			N/M
Interest income			253		216			17%				569		769			-26%
Interest expense			330		434			-24%				945		1,042			-9%
Other income (expense), net			198		(90)			N/M				370		4			N/M
Earnings from continuing operations
before income taxes			11,532		6,848			68%				21,276		782			N/M
Income tax expense (benefit)			3,480		1,312			165%				6,800		(900)			N/M
Earnings from continuing operations			8,052		5,536			45%				14,476		1,682			N/M
Earnings from discontinued operations			-		-			-				239		-			N/M
Net earnings			$8,052		$5,536			45%				$14,715		$1,682			N/M
Earnings per share - basic:
Earnings from continuing operations			$0.29		$0.20			45%				$0.52		$0.06			N/M
Earnings from discontinued operations			$ -		$ -			-				$0.01		$ -			N/M
Net earnings			$0.29		$0.20			45%				$0.53		$0.06			N/M
Average common shares outstanding			28,028,700		27,662,909			1%				27,912,842		27,773,471			1%
Earnings per share - diluted:
Earnings from continuing operations			$0.28		$0.20			40%				$0.51		$0.06			N/M
Earnings from discontinued operations			$ -		$ -			-				$0.01		$ -			N/M
Net earnings			$0.28		$0.20			40%				$0.52		$0.06			N/M
Average common and common
equivalent shares outstanding			28,832,096		27,823,745			4%				28,497,209		27,943,252			2%
Cash dividends per common share			$0.0900		$0.0815			10%				$0.2700		$0.2445			10%

Business Segments Information
(Unaudited)
			Thirteen		Thirteen						Thirty-nine		Thirty-nine
			Weeks Ended		Weeks Ended			%			Weeks Ended		Weeks Ended			%
			December 1, 2012		November 26, 2011			Change			December 1, 2012		November 26, 2011			Change
Sales
Architectural			$168,770		$152,087			11%			$460,015		$436,516			5%
Large-Scale Optical			21,648		22,769			-5%			60,477		57,235			6%
Eliminations			(2)		(3)			33%			(2)		(3)			33%
Total			$190,416		$174,853			9%			$520,490		$493,748			5%
Operating income (loss)
Architectural			$5,837		$580			N/M			$6,978		($11,597)			N/M
Large-Scale Optical			6,557		7,411			-12%			17,021		15,559			9%
Corporate and other			(983)		(835)			-18%			(2,717)		(2,911)			7%
Total			$11,411		$7,156			59%			$21,282		$1,051			N/M

Consolidated Condensed Balance Sheets
(Unaudited)
			December 1,				March 3,
			2012				2012
Assets
Current assets			$253,231				$229,439
Net property, plant and equipment			162,358				159,547
Other assets			108,092				104,118
Total assets			$523,681				$493,104
Liabilities and shareholders' equity
Current liabilities			$118,394				$105,771
Long-term debt			30,775				20,916
Other liabilities			44,370				45,219
Shareholders' equity			330,142				321,198
Total liabilities and shareholders' equity			$523,681				$493,104
N/M = Not meaningful

Apogee Enterprises, Inc. & Subsidiaries
Consolidated Condensed Statement of Cash Flows
(Unaudited)
			Thirty-nine				Thirty-nine
			Weeks Ended				Weeks Ended
Dollar amounts in thousands			December 1, 2012				November 26, 2011
Net earnings			$14,715				$1,682
Net earnings from discontinued operations			(239	)			-
Depreciation and amortization			19,817				20,615
Stock-based compensation			3,514				3,343
Other, net			(167	)			1,180
Changes in operating assets and liabilities			(14,596	)			(31,540	)
Net cash provided by (used in) continuing operating activities			23,044				(4,720	)
Capital expenditures			(21,265	)			(6,206	)
Proceeds on sale of property			48				10,314
Acquisition of intangibles			(15	)			(68	)
Net (purchases) sales of restricted investments			(4,752	)			12,665
Net (purchases) sales of marketable securities			(13,915	)			5,807
Investments in life insurance			(1,451	)			(1,435	)
Net cash (used in) provided by investing activities			(41,350	)			21,077
Proceeds from issuance of debt			10,000				121
Payments on debt			(125	)			(1,287	)
Shares withheld for taxes, net of stock issued to employees			(261	)			(743	)
Repurchase and retirement of common stock			-				(2,392	)
Dividends paid			(7,751	)			(6,865	)
Other, net			(194	)			(121	)
Net cash provided by (used in) financing activities			1,669				(11,287	)
Cash used in discontinued operations			(123	)			(3,300	)
(Decrease) increase in cash and cash equivalents			(16,760	)			1,770
Effect of exchange rates on cash			151				(148	)
Cash and cash equivalents at beginning of year			54,027				24,302
Cash and cash equivalents at end of period			$37,418				$25,924

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