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AZZ's Q2 Earnings and Revenues Miss Estimates, Rise Y/Y
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AZZ Inc. (AZZ - Free Report) reported second-quarter fiscal 2023 (ended Aug 31, 2022) operating earnings of $1.24 per share, which lagged the Zacks Consensus Estimate of $1.82 by 31.9%. The bottom line increased 68.4% from the year-ago quarter’s earnings. The year-over-year improvement was due to strong performance from both segments.
GAAP loss per share in the reported quarter was $1.91 against earnings of 76 cents per share in the prior-year quarter.
Total Revenues
Operating revenues of $406.7 million lagged the Zacks Consensus Estimate of $501 million by 18.8%. The top line increased 88.4% from the prior-year quarter, primarily due to the first full-quarter contribution from AZZ Precoat Metals.
Metal Coating: Revenues from the segment increased 26.2% to $165.8 million from $131.4 million in the prior-year quarter. The year-over-year improvement was due to pricing strategies that offset the inflationary costs.
Precoat Metal: The segment, acquired on May 13, 2022, generated revenues of $240.9 million in the reported quarter. The segment’s higher sales were driven primarily by a significantly higher average selling price from paint cost pass-through.
Highlights of the Release
The operating income in the fiscal second quarter was up 222.1% year over year to $64.1 million.
AZZ incurred interest expenses of $28.1 million, up 1552.9% from the year-ago period.
As of Aug 31, 2022, the company had cash and cash equivalents of $14.3 million. Total capital expenditure in the reported quarter was $15.2 million.
On Jun 23, 2022, it announced a definitive agreement to sell its majority stake of nearly 60% in the Infrastructure Solutions Segment (AIS) to Fernweh Group LLC to focus on metal coating and galvanizing solutions and gain from the favorable trend in end markets. On Sep 30, 2022, the company closed this transaction.
The company returned $4.2 million to its shareholders as dividends. It did not purchase company stocks in the second quarter, and nearly $55.2 million remains on the current authorization with no expiration.
Alcoa Corporation (AA - Free Report) is scheduled to announce third-quarter 2022 results on Oct 19 after market close. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at 25 cents per share.
AA’s long-term (three to five years) earnings growth is projected at 9.7%. The company delivered an average earnings surprise of 9.6% in the last four quarters.
A. O. Smith Corporation (AOS - Free Report) is scheduled to announce third-quarter 2022 results on Oct 27 before the market opens. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at 89 cents per share.
AOS’ long-term earnings growth is projected at 9%. The company delivered an average earnings surprise of 9.8% in the last four quarters.
AGCO Corporation (AGCO - Free Report) is expected to announce third-quarter 2022 results on Oct 27. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at $3.11 per share.
AGCO’s long-term earnings growth is projected at 9.6%. The company delivered an average earnings surprise of 37.5% in the last four quarters.
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AZZ's Q2 Earnings and Revenues Miss Estimates, Rise Y/Y
AZZ Inc. (AZZ - Free Report) reported second-quarter fiscal 2023 (ended Aug 31, 2022) operating earnings of $1.24 per share, which lagged the Zacks Consensus Estimate of $1.82 by 31.9%. The bottom line increased 68.4% from the year-ago quarter’s earnings. The year-over-year improvement was due to strong performance from both segments.
GAAP loss per share in the reported quarter was $1.91 against earnings of 76 cents per share in the prior-year quarter.
Total Revenues
Operating revenues of $406.7 million lagged the Zacks Consensus Estimate of $501 million by 18.8%. The top line increased 88.4% from the prior-year quarter, primarily due to the first full-quarter contribution from AZZ Precoat Metals.
AZZ Inc. Price, Consensus and EPS Surprise
AZZ Inc. price-consensus-eps-surprise-chart | AZZ Inc. Quote
Segment Revenues
Metal Coating: Revenues from the segment increased 26.2% to $165.8 million from $131.4 million in the prior-year quarter. The year-over-year improvement was due to pricing strategies that offset the inflationary costs.
Precoat Metal: The segment, acquired on May 13, 2022, generated revenues of $240.9 million in the reported quarter. The segment’s higher sales were driven primarily by a significantly higher average selling price from paint cost pass-through.
Highlights of the Release
The operating income in the fiscal second quarter was up 222.1% year over year to $64.1 million.
AZZ incurred interest expenses of $28.1 million, up 1552.9% from the year-ago period.
As of Aug 31, 2022, the company had cash and cash equivalents of $14.3 million. Total capital expenditure in the reported quarter was $15.2 million.
On Jun 23, 2022, it announced a definitive agreement to sell its majority stake of nearly 60% in the Infrastructure Solutions Segment (AIS) to Fernweh Group LLC to focus on metal coating and galvanizing solutions and gain from the favorable trend in end markets. On Sep 30, 2022, the company closed this transaction.
The company returned $4.2 million to its shareholders as dividends. It did not purchase company stocks in the second quarter, and nearly $55.2 million remains on the current authorization with no expiration.
Zacks Rank
AZZ currently has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Upcoming Releases
Alcoa Corporation (AA - Free Report) is scheduled to announce third-quarter 2022 results on Oct 19 after market close. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at 25 cents per share.
AA’s long-term (three to five years) earnings growth is projected at 9.7%. The company delivered an average earnings surprise of 9.6% in the last four quarters.
A. O. Smith Corporation (AOS - Free Report) is scheduled to announce third-quarter 2022 results on Oct 27 before the market opens. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at 89 cents per share.
AOS’ long-term earnings growth is projected at 9%. The company delivered an average earnings surprise of 9.8% in the last four quarters.
AGCO Corporation (AGCO - Free Report) is expected to announce third-quarter 2022 results on Oct 27. The Zacks Consensus Estimate for third-quarter 2022 earnings is pegged at $3.11 per share.
AGCO’s long-term earnings growth is projected at 9.6%. The company delivered an average earnings surprise of 37.5% in the last four quarters.