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Apogee (APOG) Beats Earnings Estimates in Q1, Hikes View
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Apogee Enterprises, Inc. (APOG - Free Report) reported earnings per share (EPS) of $1.00 in first-quarter fiscal 2023 (ended May 28, 2022), surpassing the Zacks Consensus Estimate of 43 cents. The bottom line increased 138% year over year.
Apogee generated revenues of $357 million in the quarter under review, up 9% year over year on solid growth in the Architectural Framing Systems and Architectural Services.
Operational Update
Cost of sales in the fiscal first quarter moved up 5% year over year to $271 million. Gross profit increased 26% year over year to $86 million. The gross margin expanded to 24% in the quarter from the prior-year quarter's 21%. Selling, general and administrative (SG&A) expenses inched up 1% year over year to $52 million. The operating income rose 107% year over year to $33 million. The operating margin in the reported quarter was 9.3% compared with the prior-year quarter's level of 4.9%.
Segment Performance
In the fiscal first quarter, revenues in the Architectural Framing Systems segment climbed 19% year over year to $163 million, aided by pricing actions. The segment's operating profit was $24 million compared with the year-ago quarter's $8 million.
Revenues in the Architectural Glass segment declined 8% year over year to $76 million on lower volumes. The segment reported an operating income of $5 million, up 143% year over year.
Revenues in the Architectural Services segment rose 14% year over year to a record $103 million, owing to higher volumes from project executions. The segment's operating profit declined 31% year over year to $3 million.
Revenues in the Large-Scale Optical Technologies segment were up 4% year over year to $25 million, driven by improved pricing and a favorable sales mix. The segment reported an operating profit of $6.5 million in the fiscal first quarter compared with the prior-year quarter's $5.8 million.
Backlog
The Architectural Services segment's backlog came in at $681 million at the end of the fiscal first quarter compared with $665 million at the end of the prior quarter. Backlog in the Architectural Framing segment amounted to $310 million, up from $281 million at the end of fourth-quarter fiscal 2022.
Financial Position
Apogee had cash and cash equivalents of $15 million at the end of first-quarter fiscal 2023 compared with $38 million at the end of fiscal 2022. Cash utilized in operating activities was $30 million in the fiscal first quarter against the prior-year quarter’s cash inflow of $7 million.
Long-term debt was $261 million at the end of the fiscal first quarter compared with $162 million at the fiscal 2022-end.
Apogee repurchased $1.57 million shares and returned $4.8 million of cash to shareholders through dividend payments in the fiscal first quarter.
The company declared a quarterly cash dividend of 22 cents per share, which will be paid on Jul 27, to shareholders of record at the close of business on Jul 12, 2022. Its board has also increased the existing share repurchase authorization by 1 million shares, bringing the total available share repurchase of 1.25 million shares.
Fiscal 2023 Guidance
Apogee now expects fiscal 2023 adjusted EPS between $3.50 and $3.90, up from the prior guidance of $2.90 and $3.30. The company anticipates revenue growth to be primarily driven by Architectural Framing Systems in fiscal 2023. Management projects capital expenditures between $35 million and $40 million for fiscal 2023.
Price Performance
Shares of Apogee have lost 19.7% in the past six months compared the industry's decline of 11.7%.
Graphic Packaging has an estimated earnings growth rate of 86.8% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 7.6%.
Graphic Packaging pulled off a trailing four-quarter earnings surprise of 7.2%, on average. The company’s shares have appreciated 8% in the past six months.
Myers Industries has an expected earnings growth rate of 67% for 2022. The Zacks Consensus Estimate for the current year’s earnings has moved up 27% in the past 60 days.
MYE has a trailing four-quarter earnings surprise of 20.1%, on average. Myers Industries’ shares have increased 25% over the last six months.
Packaging Corporation has an expected earnings growth rate of 16.2% for 2022. The Zacks Consensus Estimate for the current year’s earnings rose 4.2% in the past 60 days.
PKG has a trailing four-quarter earnings surprise of 19.6%, on average. Packaging Corporation’s shares have risen 16% in the past six months.
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Apogee (APOG) Beats Earnings Estimates in Q1, Hikes View
Apogee Enterprises, Inc. (APOG - Free Report) reported earnings per share (EPS) of $1.00 in first-quarter fiscal 2023 (ended May 28, 2022), surpassing the Zacks Consensus Estimate of 43 cents. The bottom line increased 138% year over year.
Apogee generated revenues of $357 million in the quarter under review, up 9% year over year on solid growth in the Architectural Framing Systems and Architectural Services.
Operational Update
Cost of sales in the fiscal first quarter moved up 5% year over year to $271 million. Gross profit increased 26% year over year to $86 million. The gross margin expanded to 24% in the quarter from the prior-year quarter's 21%.
Selling, general and administrative (SG&A) expenses inched up 1% year over year to $52 million. The operating income rose 107% year over year to $33 million. The operating margin in the reported quarter was 9.3% compared with the prior-year quarter's level of 4.9%.
Segment Performance
In the fiscal first quarter, revenues in the Architectural Framing Systems segment climbed 19% year over year to $163 million, aided by pricing actions. The segment's operating profit was $24 million compared with the year-ago quarter's $8 million.
Revenues in the Architectural Glass segment declined 8% year over year to $76 million on lower volumes. The segment reported an operating income of $5 million, up 143% year over year.
Revenues in the Architectural Services segment rose 14% year over year to a record $103 million, owing to higher volumes from project executions. The segment's operating profit declined 31% year over year to $3 million.
Revenues in the Large-Scale Optical Technologies segment were up 4% year over year to $25 million, driven by improved pricing and a favorable sales mix. The segment reported an operating profit of $6.5 million in the fiscal first quarter compared with the prior-year quarter's $5.8 million.
Backlog
The Architectural Services segment's backlog came in at $681 million at the end of the fiscal first quarter compared with $665 million at the end of the prior quarter. Backlog in the Architectural Framing segment amounted to $310 million, up from $281 million at the end of fourth-quarter fiscal 2022.
Financial Position
Apogee had cash and cash equivalents of $15 million at the end of first-quarter fiscal 2023 compared with $38 million at the end of fiscal 2022. Cash utilized in operating activities was $30 million in the fiscal first quarter against the prior-year quarter’s cash inflow of $7 million.
Long-term debt was $261 million at the end of the fiscal first quarter compared with $162 million at the fiscal 2022-end.
Apogee repurchased $1.57 million shares and returned $4.8 million of cash to shareholders through dividend payments in the fiscal first quarter.
The company declared a quarterly cash dividend of 22 cents per share, which will be paid on Jul 27, to shareholders of record at the close of business on Jul 12, 2022. Its board has also increased the existing share repurchase authorization by 1 million shares, bringing the total available share repurchase of 1.25 million shares.
Fiscal 2023 Guidance
Apogee now expects fiscal 2023 adjusted EPS between $3.50 and $3.90, up from the prior guidance of $2.90 and $3.30. The company anticipates revenue growth to be primarily driven by Architectural Framing Systems in fiscal 2023. Management projects capital expenditures between $35 million and $40 million for fiscal 2023.
Price Performance
Shares of Apogee have lost 19.7% in the past six months compared the industry's decline of 11.7%.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Apogee currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Industrial Products sector are Graphic Packaging Holding Company (GPK - Free Report) , Myers Industries (MYE - Free Report) and Packaging Corporation of America (PKG - Free Report) , each flaunting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Graphic Packaging has an estimated earnings growth rate of 86.8% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 7.6%.
Graphic Packaging pulled off a trailing four-quarter earnings surprise of 7.2%, on average. The company’s shares have appreciated 8% in the past six months.
Myers Industries has an expected earnings growth rate of 67% for 2022. The Zacks Consensus Estimate for the current year’s earnings has moved up 27% in the past 60 days.
MYE has a trailing four-quarter earnings surprise of 20.1%, on average. Myers Industries’ shares have increased 25% over the last six months.
Packaging Corporation has an expected earnings growth rate of 16.2% for 2022. The Zacks Consensus Estimate for the current year’s earnings rose 4.2% in the past 60 days.
PKG has a trailing four-quarter earnings surprise of 19.6%, on average. Packaging Corporation’s shares have risen 16% in the past six months.