Apogee Enterprises, Inc. (Nasdaq:APOG) today announced fiscal 2014 second-quarter results. Apogee provides distinctive solutions for enclosing commercial buildings and framing art. FY14 SECOND QUARTER VS. PRIOR-YEAR PERIOD
- Revenues of $178.3 million were up 1 percent.
- Operating income of $9.4 million was up 24 percent.
- Earnings per share of $0.21 were up 17 percent.
- Architectural Glass segment had revenue growth of 11 percent and improved operating income.
- Consolidated backlog of $304.2 million was up 1 percent.
- Cash and short-term investments of $73.7 million were up 8 percent.
FY14 SECOND-QUARTER SEGMENT AND OPERATING RESULTS VS. PRIOR-YEAR PERIODArchitectural Glass
- Revenues of $70.0 million were up 11 percent.
- Operating income was $0.8 million, improved from an operating loss of $2.0 million.
- Operating margin was 1.1 percent, compared to negative 3.2 percent.
- Top- and bottom-line increases resulted from improved mix, pricing and productivity.
- Revenues of $42.2 million were down 10 percent due to the timing of project flow.
- Operating loss was $0.8 million, improved from an operating loss of $1.0 million despite the decline in current quarter revenues.
- Operating margin was negative 1.9 percent, compared to negative 2.2 percent as project margins increase from the cycle trough.
- Revenues of $49.5 million were down 5 percent.
- Operating income was $5.2 million, compared to $6.1 million.
- Operating margin was 10.5 percent, compared to 11.6 percent.
- Solid top- and bottom-line growth in the storefront and finishing businesses was offset by the window business results, where revenues and operating income declined with an anticipated gap in the schedule for more complex projects.
- During the quarter, completed an acquisition that adds an historic window renovation product line.
- Revenues of $19.7 million were up 1 percent.
- Operating income was $5.3 million, compared to $5.2 million.
- Operating margin was 26.9 percent, up from 26.5 percent.
- Consolidated backlog was $304.2 million up from $301.8 million in the first quarter of fiscal 2014 and $301.3 million in the prior-year period.
- Approximately $202 million, or 66 percent, of the backlog is expected to be delivered in fiscal 2014, and approximately $102 million, or 34 percent, in fiscal 2015.
- Debt was $20.8 million, compared to $30.8 million at the end of fiscal 2013. Almost all the debt is long-term, low-interest industrial revenue bonds.
- Cash and short-term investments totaled $73.7 million, compared to $85.6 million at the end of fiscal 2013 and $68.3 million in the prior-year period.
- Non-cash working capital was $70.3 million, compared to $54.1 million at the end of fiscal 2013 and $57.4 million in the prior-year period.
- Capital expenditures year to date were $8.2 million, compared to $15.7 million in the prior-year period.
- Depreciation and amortization year to date was $13.2 million.
“We again expect to outperform domestic commercial construction market growth by several percentage points,” Puishys said. “The outlook for U.S. commercial construction markets in fiscal 2014, based on Apogee’s lag to McGraw-Hill forecasts for the segments we serve, is for modest market growth.“We continue to expect that capital spending for fiscal 2014 will be in the range of $40 to $45 million as we invest for growth, productivity and product development capabilities,” he said. “We expect to be free cash flow positive after this level of investments.” He added that the fiscal 2014 gross margin is anticipated to be approximately 22 percent. “I believe that our strategies to grow through new geographies, new products and new markets will allow Apogee to reach $1 billion in revenues by the end of fiscal 2016,” Puishys said. “At the same time, we believe we can achieve 10 percent operating margin in this timeframe, in part through our focus on productivity and operational improvements.” TELECONFERENCE AND SIMULTANEOUS WEBCASTApogee will host a teleconference and webcast at 10 a.m. Central Time tomorrow, September 19. To participate in the teleconference, call 1-866-700-6293 toll free or 617-213-8835 international, access code 58227135. The replay will be available from noon Central Time on September 19 through midnight Central Time on Thursday, September 26, 2013, by calling 1-888-286-8010 toll free, access code 69449613. 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 four segments, with three of the segments serving the commercial construction market:
- Architectural Glass segment consists of Viracon, the leading fabricator of coated, high-performance architectural glass for global markets.
- Architectural Services segment consists of Harmon, Inc., one of the largest U.S. full-service building glass installation and renovation companies.
- Architectural Framing Systems segment businesses design, engineer, fabricate and finish the aluminum frames for window, curtainwall and storefront systems that comprise the outside skin of buildings. Businesses in this segment are: 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 primarily for the custom picture framing market.
|Apogee Enterprises, Inc. & Subsidiaries|
|Consolidated Condensed Statement of Income|
|Dollar amounts in thousands, except for per share amounts||ThirteenWeeks Ended August 31, 2013||ThirteenWeeks EndedSeptember 1, 2012||Twenty-sixWeeks EndedAugust 31, 2013||Twenty-sixWeeks EndedSeptember 1, 2012|
|Cost of goods sold||139,752||139,803||0||%||282,677||262,862||8||%|
|Selling, general and administrative expenses||29,177||28,584||2||%||59,449||57,342||4||%|
|Other (expense) income, net||(104||)||393||N/M||(34||)||411||N/M|
|Earnings before income taxes||9,221||7,738||19||%||15,080||9,982||51||%|
|Income tax expense||3,100||2,681||16||%||4,800||3,319||45||%|
|Earnings per share - basic||$0.21||$0.18||17||%||$0.36||$0.24||50||%|
|Average common shares outstanding||28,394,147||27,922,058||2||%||28,417,402||27,854,913||2||%|
|Earnings per share - diluted||$0.21||$0.18||17||%||$0.35||$0.24||46||%|
|Average common and common equivalent shares outstanding||29,210,505||28,436,466||3||%||29,273,992||28,329,766||3||%|
|Cash dividends per common share||$0.0900||$0.0900||0||%||$0.1800||$0.1800||0||%|
|Business Segments Information|
|ThirteenWeeks EndedAugust 31, 2013||ThirteenWeeks EndedSeptember 1, 2012||Twenty-sixWeeks EndedAugust 31, 2013||Twenty-sixWeeks EndedSeptember 1, 2012|
|Architectural Framing Systems||49,450||52,170||-5||%||93,896||94,577||-1||%|
|Operating income (loss)|
|Architectural Framing Systems||5,180||6,066||-15||%||7,244||9,162||-21||%|
|Corporate and other||(1,121||)||(672||)||-67||%||(2,175||)||(1,734||)||-25||%|
|Consolidated Condensed Balance Sheets|
|August 31,2013||March 2,2013|
|Net property, plant and equipment||163,721||168,948|
|Liabilities and shareholders' equity|
|Total liabilities and shareholders' equity||$508,489||$520,141|
|N/M = Not meaningful|
|Apogee Enterprises, Inc. & Subsidiaries|
|Consolidated Condensed Statement of Cash Flows|
|Dollar amounts in thousands||Twenty-sixWeeks EndedAugust 31, 2013||Twenty-sixWeeks EndedSeptember 1, 2012|
|Depreciation and amortization||13,175||13,113|
|Changes in operating assets and liabilities||(11,507||)||(12,061||)|
|Net cash provided by operating activities||12,262||10,433|
|Proceeds on sale of property||458||18|
|Acquisition of business, net of cash acquired||(2,155||)||-|
|Net sales (purchases) of restricted investments||19,856||(7,920||)|
|Net sales (purchases) of marketable securities||11,179||(14,593||)|
|Investments in life insurance||-||(900||)|
|Net cash provided by (used in) investing activities||21,102||(39,074||)|
|Proceeds from issuance of debt||-||10,000|
|Payments on debt||(10,029||)||(86||)|
|Shares withheld for taxes, net of stock issued to employees||(1,361||)||(554||)|
|Net cash (used in) provided by financing activities||(15,117||)||4,163|
|Increase (decrease) in cash and cash equivalents||18,247||(24,478||)|
|Effect of exchange rates on cash||(373||)||4|
|Cash and cash equivalents at beginning of year||37,767||54,027|
|Cash and cash equivalents at end of period||$55,641||$29,553|