Astec Industries Inc.
) has reported fourth quarter results, delivering an adjusted EPS
of 41 cents versus 28 cents in the year-earlier quarter, beating
the Zacks Consensus Estimate of 39 cents.
The earnings per share in the reported quarter excluded charges
related to the sale of the utility trencher product line in the
Underground segment. The fourth quarter 2010 EPS excluded asset
impairment charges. Including these charges, EPS amounted to 35
cents for the fourth quarter of 2011 compared with 26 cents in the
fourth quarter of 2010.
Total revenue increased 38% to $263.2 million from $190.8
million in the year-ago quarter. Total revenue missed the Zacks
Consensus Estimate of 228 million.
Domestic sales of the company amounted to $147.1 million in the
quarter compared with $119.6 million in the year-earlier quarter.
International sales increased to $116.0 million from $71.2 million
in the year-ago quarter.
Fiscal 2011 Performance
In 2011, adjusted EPS increased 22% to $1.86 from 62 cents per
share in 2010. Adjusted EPS beat the Zacks Consensus Estimate of
Adjusted EPS in 2011 excluded charges related to the sale of
utility trencher product line and an impairment charge. Adjusted
EPS in 2010 included asset impairment charges. Including these
charges, EPS amounted to $1.74 in the year 2011 compared with $1.42
in the year 2010.
Total revenue increased 24% to $955.7 million in 2011 from
$771.3 million in 2010. Total revenue comfortably surpassed the
Zacks Consensus estimate of $920 million.
Costs and Margins
Cost of sales increased 42% to $207.4 million in the quarter
from $146.5 million in the prior-year quarter. Gross profit
increased 26% to $55.7 million from $44.3 million in the year-ago
quarter. However, gross margins decreased 200 basis points year
over year to 21.2% in the quarter.
Selling, general, administrative & engineering expenses rose
to $43.5 million in the reported quarter from $36.3 million in the
year-earlier quarter. Income from operations also increased to
$12.3 million from $8.0 million in the year-ago quarter.
Consequently, operating margins increased 50 basis points year over
year to 4.7%.
Total revenue in the
segment amounted to $68.0 million, up from $45.5 million in the
year-ago quarter. Gross profit increased to $16.7 million from $9.9
million in the prior-year quarter.
Net sales of
Aggregate and Mining Group
segment were $84.6 million in the quarter, up from $70.2 million in
the previous-year quarter. Gross profit also increased to $21.6
million in the quarter from $17.5 million in the prior-year
Mobile Asphalt Paving Group
segment reported total revenue of $45.4 million versus $40.4
million in the year-ago quarter. Gross profit during the quarter
dropped to $10.8 million from $11.4 million in the year-earlier
reported net sales of $26.2 million versus $18.3 million in the
year-over-year quarter. Gross profit declined $643,000 from $1.95
million in the previous-year quarter.
segment reported total revenue of $38.9 million, improving from
$16.3 million in the year-earlier quarter. However, gross profit
declined to $6.1 million from $3.5 million in the year-ago
As of December 31, 2011, cash and cash equivalents amounted to
$57.5 million, a decline from $94.6 million as of December 31,
2010. The company has a zero debt balance sheet. Astec's backlog
increased to $148.0 million at the end of fourth quarter of 2011
from $111.0 million at the end of fourth quarter of 2010.
Astec has completed the acquisition of two companies and started
a new joint venture in Brazil. It has also bought two new
facilities and expanded three facilities. Alongside it has
negotiated the sale of the utility product line and developed a
many new products.
A large number of Astec's customers depend substantially on
government funding for highway construction and maintenance, along
with other infrastructure projects. With no progress in the
reauthorization of the Highway Bill, the outlook for domestic sales
The company currently has a Zacks #4 Rank (short-term Sell
recommendation) on its stock.
Chattanooga, Tennessee-based Astec Industries is a leading
manufacturer and marketer of road building equipment. The company
sells equipment used in all phases of road building, from quarrying
and crushing the aggregate to applying the asphalt. The company
also sells equipment and components unrelated to road
Operating through four segments like Aggregate and Mining Group,
Asphalt Group, Mobile Asphalt Group and Underground Group., Astec
Gencor Industries Inc.
) and privately held CMI Terex Corporation.
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