Astec Industries Inc
) has reported first quarter results, delivering an EPS of 53 cents
versus 44 cents in the year-earlier quarter, a 20% increase but
falling short of the Zacks Consensus Estimate of 61 cents.
Total revenue increased 16% to $266.6 million from $230.2
million in the year-ago quarter. Total revenue missed the Zacks
Consensus Estimate of $273 million.
Domestic sales of the company amounted to $161.4 million in the
quarter compared with $147.5 million in the year-earlier quarter.
International sales increased 27% to $105.2 million from $82.7
million in the year-ago quarter.
Costs and Margins
Cost of sales increased 17% to $206 million in the quarter from
$175 million in the prior-year quarter. Gross profit increased 11%
to $60.6 million from $54.7 million in the year-ago quarter.
However, gross margins decreased 110 basis points year over year to
22.7% in the quarter.
Selling, general, administrative & engineering expenses rose
to $41.9 million in the reported quarter from $39.5 million in the
year-earlier quarter. Income from operations increased 23% to $18.7
million from $15.2 million in the year-ago quarter. Consequently,
operating margins increased 40 basis points year over year to
Total revenue in the Asphalt Group segment amounted to $68.7
million, down from $73.7 million in the year-ago quarter. Gross
profit decreased to $16.4 million from $19.2 million in the
Net sales of Aggregate and Mining Group segment were $91.3
million in the quarter, up from $78.8 million in the previous-year
quarter. Gross profit also increased to $23.7 million in the
quarter from $18.7 million in the prior-year quarter.
Mobile Asphalt Paving Group segment reported total revenue of
$42 million versus $50 million in the year-ago quarter. Gross
profit during the quarter dropped to $10.6 million from $13.4
million in the year-earlier quarter.
Underground Group reported net sales of $36.7 million versus
$11.7 million in the year-over-year quarter. Gross profit increased
to $5.1 million from $0.12 million in the previous-year
All Others segment reported total revenue of $27.9 million,
improving from $16 million in the year-earlier quarter. Gross
profit increased to $4.8 million from $3.2 million in the year-ago
As of March 31, 2012, cash and cash equivalents amounted to
$41.6 million, a decline from $57.5 million as of December 31, 2011
and $80.2 million as of March 31, 2011. The company has a zero debt
balance sheet. Astec's backlog increased to $285.6 million at the
end of first quarter of 2012 from $264.7 million at the end of
first quarter of 2011.
The acquisitions of GEFCO and STECO will help Astec to focus on
higher growth industries. Astec will continue to seek acquisition
opportunities and focus its attention to improve its gross margins
and refining its manufacturing processes on 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 #3 Rank (short-term Hold
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
competes with Caterpillar Inc. (
), Gencor Industries Inc. (
) and privately held CMI Terex Corporation.
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