Astec Industries Inc
) has reported its second-quarter 2012 results, delivering earnings
of 45 cents per share, falling short of the Zacks Consensus
Estimate of 66 cents as well as 61 cents in the year-earlier
Total revenues increased 2% to $253.9 million from $247.8
million in the year-ago quarter. Total revenues also missed the
Zacks Consensus Estimate of $282 million.
Domestic sales of the company soared 16% to $161.5 million in
the quarter compared with $139.5 million in the year-earlier
quarter. International sales decreased 15% to $92.4 million from
$108.3 million in the year-ago quarter.
Costs and Margins
Cost of sales increased 6.4% to $197.6 million in the quarter
from $185.8 million in the prior-year quarter. Gross profit
decreased 9.3% to $56.2 million from $70 million in the year-ago
quarter. Consequently, gross margins decreased 290 basis points
year over year to 22.1% in the quarter.
Selling, general, administrative & engineering expenses rose
4.1% to $40.4 million in the reported quarter from $38.8 million in
the year-earlier quarter. Income from operations decreased 24.3% to
$15.9 million from $21.0 million in the year-ago quarter.
Consequently, operating margins decreased 230 basis points year
over year to 6.2%.
Total revenues in the
segment decreased 12.8% to $59.3 million from $68.2 million in the
year-ago quarter. Gross profit decreased 29.7% to $11.8 million
from $16.8 million in the prior-year quarter.
Total revenues of the
Aggregate and Mining Group
segment increased 9.6% to $94.9 million in the quarter from $86.6
million in the previous-year quarter. Gross profit also increased
to $25.8 million in the quarter from $22.4 million in the
Mobile Asphalt Paving Group
segment's total revenue decreased 15.5% to $45.2 million versus
$53.5 million in the year-ago quarter. Gross profit during the
quarter dropped to $10.2 million from $15.6 million in the
reported total revenues of $34.8 million versus $23.1 million in
the year-ago quarter. Gross profit increased to $5.2 million from
$3.9 million in the previous-year quarter.
reported total revenue of $19.6 million, improving from $16.5
million in the year-earlier quarter. Gross profit remained flat
year over year at $3.3 million.
Cash and cash equivalents amounted to $35.9 million as of June
30, 2012, a decline from $73.5 million as of June 30, 2011. The
company has a zero debt balance sheet. Astec's backlog increased to
$258.3 million at the end of the second quarter of 2012 from $237.5
million at the end of second quarter of 2011.
The acquisitions of GEFCO and STECO helped Astec focus on higher
growth industries. Astec continues to seize opportunities to make
acquisitions in order to augment its products range and expand its
geographical footprint. Moreover, the new 27-month highway bill
will help Astec by increasing demand for its products in the
However, the economic slowdown has hurt Astec's demand for its
products in the international market. Unless and until the market
resumes, we do not see a major improvement in the demand for its
products. Astec also faces tough competition from companies
Gencor Industries Inc.
) and privately held CMI Terex Corporation.
The company currently has a Zacks #5 Rank (short-term Strong
Sell recommendation) on its stock. We have a long-term Neutral
recommendation on Astec.
ASTEC INDS INC (ASTE): Free Stock Analysis
CATERPILLAR INC (CAT): Free Stock Analysis
(GENC): ETF Research Reports
To read this article on Zacks.com click here.