Apogee Enterprises, Inc.
) delivered first quarter fiscal 2013 earnings of 6 cents per
share, in stark contrast to the prior year loss of 8 cents.
Earnings surpassed the Zacks Consensus Estimate of 3 cents per
Total Revenue improved just 1% year-over-year to $154.1 million,
missing the Zacks Consensus Estimate of $164 million. The
improvement was driven mainly by the growth in Large-Scale Optical
Cost of sales declined 5% year-over-year to $123.1 million in the
quarter. Gross profit improved 31% to $31.1 million. Gross margin
in the quarter improved 480 basis points to 20.2%.
SG&A expenses increased 6% in the quarter to $28.8 million.
Operating income was $2.3 million compared to a loss of $3.4
million in the year ago quarter.
Revenues in the
Architectural Products and Services
segment remained flat at $134.9 million. The growth from storefront
share gains along with installation business was offset by a lag in
architectural project timing during the first quarter of fiscal
Operating loss in the quarter narrowed to $1.9 million from the
year ago loss of $7.1 million. The improvement was driven by higher
pricing of architectural glass and volume growth in the storefront,
partially offset by lower margins in installation businesses.
Backlog in the segment was $267.3 million compared to $237 million
in the year ago quarter. The company expects to deliver roughly
$188 million or 70% of the backlog in fiscal 2013 and $79 million
or 30% in fiscal 2014.
Large-Scale Optical Technologies
segment's revenues increased 7% to $19.3 million. Operating income
in the reported quarter improved 14% to $5.3 million. The
improvement stemmed from higher value-added picture framing glass
and acrylic mix.
Apogee ended the quarter with cash and short-term investments of
$57.5 million, compared to $79.3 million at fiscal 2012 end. Long
term debt amounted to $30.9 million compared to $20.9 million at
fiscal 2012 end.
Capital expenditure in the quarter was $9.5 million compared to
$1.6 million. Cash used in operating activities was $7.6 million
compared to $20.5 million during the first quarter of fiscal
For fiscal 2013, Apogee has increased its earnings guidance to the
range of 48 cents-58 cents per share from the previous guidance of
40 cents-50 cents. It expects revenue growth in the mid-single
digits, driven by its strategy of expanding its geographical
footprint of both the installation and storefront businesses.
Further, the company expects to generate positive free cash flow
after spending $25 million to improve productivity and capacity,
besides introducing new products along with maintaining the
Apogee has a robust architectural backlog for the balance of the
year. It intends to invest a considerable amount in new products to
boost its product portfolio. Furthermore, Apogee considers spending
on capacity as well as productivity improvements.
APOGEE ENTRPRS (APOG): Free Stock Analysis
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However, Apogee faces competition from privately held companies
like AGC Flat Glass North America, Inc, Guardian Glass Company and
Pilkington Group Limited. Apogee retains a short-term Zacks #3 Rank
(Hold). We have a Neutral recommendation on the stock.