- Revenues of $238.3 million were down 2 percent.
- In constant currency, revenues were flat.
- Operating income of $27.9 million was up 35 percent.
- Earnings per share of $0.63 were up 34 percent.
- Backlog of $544.7 million was up 10 percent to a record level.
- Cash and short-term investments were $91.4 million.
FY16 THIRD-QUARTER SEGMENT AND OPERATING RESULTS VS. PRIOR-YEAR PERIODArchitectural Glass
- Revenues of $85.5 million were down 5 percent, primarily due to currency exchange and lower volume at the Brazil operation.
- Operating income grew to $8.4 million, up 44 percent from $5.8 million.
- Operating margin expanded 330 basis points to 9.8 percent, compared to 6.5 percent, due to improved pricing, mix and productivity.
- Revenues of $61.2 million were up 9 percent.
- Operating income grew to $3.7 million with good operational performance and improving project margins. This compares to $0.3 million last year when operating results were negatively impacted by a few projects in the period.
- Operating margin expanded 540 basis points to 6.0 percent, compared to 0.6 percent.
- Revenues of $76.4 million were down 5 percent, primarily due to currency exchange and lower volume at the Canadian storefront business.
- Operating income grew to $9.2 million, up 22 percent from $7.6 million.
- Operating margin expanded 270 basis points to 12.1 percent, compared to 9.4 percent as a result of lower raw material costs and improved pricing and productivity.
- Revenues of $24.2 million were down 5 percent due to timing of customer orders.
- Operating income of $7.6 million was down 3 percent from $7.9 million.
- Operating margin expanded 70 basis points to 31.5 percent, compared to 30.8 percent due to good productivity and cost management.
- Backlog of $544.7 million was up 6 percent from the backlog of $511.9 million in the second quarter, and up 10 percent from $493.9 million in the prior-year period.
- Approximately $167 million, or 30 percent, of the backlog is expected to be delivered in fiscal 2016; and approximately $378 million, or 70 percent, in fiscal 2017 and beyond.
- Cash and short-term investments totaled $91.4 million, compared to $52.5 million at the end of fiscal 2015 and $34.3 million in the prior-year period.
- Debt was $20.8 million, compared to $22.6 million in the prior-year period. Almost all the debt is long-term, low-interest industrial revenue bonds.
- Non-cash working capital was $78.1 million, compared to $97.5 million at the end of fiscal 2015 and $103.1 million in the prior-year period.
- Capital expenditures year to date were $26.8 million, compared to $18.7 million in the prior-year period.
- Depreciation and amortization year to date was $23.3 million.
He said that capital expenditures for the year are anticipated to be $40 to $45 million as Apogee invests to increase capabilities, capacity and productivity. The gross margin is expected to be at least 24.5 percent."I am pleased that our strategies to grow through new geographies, new products and new markets, along with our focus on better project selection, productivity and operational improvements, are delivering positive results," Puishys said. TELECONFERENCE AND SIMULTANEOUS WEBCASTApogee will host a teleconference and webcast at 9 a.m. Central Time tomorrow, December 17. To participate in the teleconference, call (866) 525-3151 toll free or (330) 863-3393 international, access code 98354366. The replay will be available from noon Central Time on December 17 through midnight Central Time on December 24 by dialing (855) 859-2056, access code 98354366. 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; Alumicor, a fabricator of aluminum storefront, entrance, curtainwall and window products for Canadian markets; 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.
- Backlog is defined as the dollar amount of revenues Apogee expects to recognize in the future from firm contracts or orders received, as well as those that are in progress.
- 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 available for sale securities, short-term restricted investments and current portion of long-term debt, less current liabilities.
- Adjusted earnings per share excludes benefit from the 48C tax credit of $0.22 per share recognized in the second quarter of fiscal 2015.
- Constant currency revenue growth excludes the impact of fluctuations in foreign currency on Apogee's international operations. Constant currency percentages are calculated by converting prior-period local currency results using the current period exchange rates and comparing these adjusted amounts to current period reported results.
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: (A) the cyclical nature and market conditions of the North American and Latin American commercial construction industries, which impact our three architectural segments, and consumer confidence and the conditions of the U.S. economy, which impact our large-scale optical segment; (B) fluctuations in foreign currency exchange rates; (C) actions of new and existing competitors; (D) ability to efficiently utilize and increase production capacity; (E) product performance, reliability and quality issues; (F) project management and installation issues that could result in losses on individual contracts; (G) ability to fully realize government incentives; (H) changes in consumer and customer preference, or architectural trends and building codes; (I) dependence on a relatively small number of customers in certain business segments; (J) volatile revenue and operating results that could differ from market expectations; (K) self-insurance risk related to a material product liability or other event for which the company is liable; (L) dependence on information technology systems and information security threats; (M) cost of compliance with and changes in environmental regulations; and (N) potential impact on financial results if one or more key employees were no longer active with the company. 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 February 28, 2015.
|Apogee Enterprises, Inc. & Subsidiaries|
|Consolidated Condensed Statement of Income|
|Weeks Ended||Weeks Ended||%||Weeks Ended||Weeks Ended||%|
|Dollar amounts in thousands, except for per share amounts||November 28, 2015||November 29, 2014||Change||November 28, 2015||November 29, 2014||Change|
|Cost of goods sold||175,898||187,757||-6||%||544,326||539,826||1||%|
|Selling, general and administrative expenses||34,568||36,028||-4||%||106,209||103,474||3||%|
|Other income (expense), net||(75||)||(16||)||-369||%||(120||)||1,461||N/M|
|Earnings before income taxes||27,882||20,495||36||%||68,670||45,331||51||%|
|Income tax expense||9,361||6,759||38||%||23,264||8,703||167||%|
|Earnings per share - basic||$0.64||$0.47||36||%||$1.56||$1.27||23||%|
|Average common shares outstanding||29,181,021||28,725,412||2||%||29,137,484||28,758,986||1||%|
|Earnings per share - diluted||$0.63||$0.47||34||%||$1.54||$1.25||*||23||%|
|Average common and common equivalent shares outstanding||29,466,282||29,357,729||0||%||29,479,078||29,349,533||0||%|
|Cash dividends per common share||$0.110||$0.100||10||%||$0.330||$0.300||10||%|
|* Adjusted earnings per share for the nine months ended November 29, 2014 is $1.03, excluding a $0.22 benefit from an energy-efficient investment tax credit. Excluding the impact of this credit, earnings per share for the nine months ended November 28, 2015 increased 50% over the prior year.|
|Business Segments Information|
|Weeks Ended||Weeks Ended||%||Weeks Ended||Weeks Ended||%|
|November 28, 2015||November 29, 2014||Change||November 28, 2015||November 29, 2014||Change|
|Architectural Framing Systems||76,419||80,411||-5||%||228,990||221,369||3||%|
|Operating income (loss)|
|Architectural Framing Systems||9,244||7,596||22||%||24,197||16,974||43||%|
|Corporate and other||(1,092||)||(1,009||)||-8||%||(3,292||)||(3,240||)||-2||%|
|Consolidated Condensed Balance Sheets|
|November 28, 2015||February 28, 2015|
|Net property, plant and equipment||194,145||193,540|
|Liabilities and shareholders' equity|
|Total liabilities and shareholders' equity||$640,528||$612,057|
|Apogee Enterprises, Inc. & Subsidiaries|
|Consolidated Condensed Statement of Cash Flows|
|Weeks Ended||Weeks Ended|
|Dollar amounts in thousands||November 28, 2015||November 29, 2014|
|Depreciation & amortization||23,336||21,558|
|Changes in operating assets and liabilities||23,260||(20,424||)|
|Net cash provided by operating activities||86,167||37,080|
|Change in marketable securities||(60,786||)||2,872|
|Net cash used in investing activities||(91,418||)||(16,322||)|
|Repurchase and retirement of common stock||(7,257||)||(6,894||)|
|Net cash used in financing activities||(14,816||)||(14,956||)|
|(Decrease) increase in cash and cash equivalents||(20,067||)||5,802|
|Effect of exchange rates on cash||(1,405||)||(200||)|
|Cash and cash equivalents at beginning of year||52,185||28,465|
|Cash and cash equivalents at end of period||$||30,713||$||34,067|