Apogee Enterprises Inc.
) reported earnings per share of 20 cents for fiscal 2012 third
quarter ending November 26. Results reversed the loss per share of
8 cents in the year-ago quarter and were ahead of the Zacks
Consensus Estimate of 11 cents.
Apogee's total revenue increased 19% to $174.9 million in the
reported quarter, outpacing the Zacks Consensus Estimate of $170
million. The increase in revenue was largely driven by double-digit
growth in Architectural Products and Services revenue.
Costs of sales increased 13% year over year to $140 million
during the quarter and selling, general and administrative expenses
were up 11% year over year to $27.6 million. Apogee reported an
operating profit of $7.1 million in the quarter, a stark
improvement from the year-ago quarter's loss of $1.8 million.
The segment reported net sales of $152 million in the quarter under
review, up 21% year over year. The addition of Brazilian
architectural glass business, increase in volumes in the window and
storefront businesses as well as higher architectural glass pricing
aided the segment to deliver solid results.
The segment reported an operating profit of $0.6 million,
reversing year-ago loss of $8.4 million helped by higher
architectural glass pricing and leverage on volume growth,
partially offset by lower margin work in the installation
The segment's backlog was $230.7 million at the end of the
quarter compared with $231.3 million at the end of the second
quarter and $165.7 million at the end of the prior-year quarter. Of
this 41% is expected to be delivered in fiscal 2012, 55% in fiscal
2013 and the balance in fiscal 2014.
Large-Scale Optical Segment:
Segment revenue increased 6% year over year to $22.8 million. The
segment operating profit remained flat at $7.4 million.
Apogee ended the quarter with cash and short-term investments of
$46.4 million compared with $45.3 million at the end of the
sequentially preceding quarter. Long-term debt remained flat at
$21.1 million compared with the second quarter. During the first
nine months of fiscal 2012, cash used in operating activities was
$4.72 million, compared with $25.1 million used in the comparable
The company expects to remain profitable in the fourth quarter
but cautions that revenues will be down sequentially due to
Architectural project timing and Large-Scale Optical
Given the upbeat third quarter results Apogee has upped its
fiscal 2012 outlook. The company now expects revenues to increase
approximately 14%, up from its previous guidance of more than 10%.
Fiscal 2012 EPS is envisioned at more than 7 cents. The company
also expects to generate positive cash flow in fiscal 2012.
Apogee's long-term strategies have helped the company survive
the loss-making environment and maintain its strong balance sheet.
The strategy includes a number of cost cutting initiatives, which
help the company to remain focused on productivity improvements in
order to counter the ill effects of a downturn in commercial
The company maintained its capacity and workforce to respond to
potential growth in fiscal 2012, and continues to emphasize
longer-term strategies to expand its energy-efficient architectural
glass offerings both domestically and all over the world. We
maintain our Neutral recommendation on Apogee. The quantitative
Zacks #3 Rank (short-term Hold rating) on the stock indicates no
clear directional pressure on the shares over the near term.
Apogee Enterprises is a technology leader in the design and
development of value-added glass products, services and systems.
The company presently has two reportable segments - The
Architectural segment and Large-Scale Optical Technologies. Apogee
competes with privately held AGC Flat Glass North America, Inc.,
Guardian Glass Company and Pilkington Group Limited.
APOGEE ENTRPRS (
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