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Apogee Enterprises Shares Trade Up 12.5% on Q2 Earnings and Yearly Outlook

Source: Streetwise Reports


September 18, 2019 ( Newswire) Shares of Apogee Enterprises are trading higher today after the commercial and architectural glass and framing company announced Q2/20 earnings and updated its estimates for the rest of the year.

This morning commercial and architectural glass fabricator and window framing company Apogee Enterprises Inc. (APOG:NASDAQ) announced its second-quarter earnings for the period ending August 31, 2019. For Q2/20, the company reported revenue was $357.1 million, compared to $362.1 million in Q2/19. Earnings per diluted share in were $0.72 in Q2/20, equal to that in Q2/19.

The firm advised that Architectural Framing Systems revenue in Q2/20 was $187.4 million, compared to $189.9 million in Q2/19, and that the segment's backlog stands at $388 million, compared to $407 million in Q1/20. The company's Architectural Glass segment grew 13% in Q2/20, with revenue of $99.1 million compared to $88.1 million in Q2/19, primarily driven by increased volume and a more favorable sales mix. Architectural Services revenue decreased to $61.6 million in Q2/20, compared to $76.5 million in Q2/19 on lower volumes due to the timing of project activity. The company indicated that this segment continued to have strong order flow during Q2/20, with segment backlog increasing to $502 million, from $483 million in Q1/20. Large-Scale Optical revenue was $20.8 million in Q2/20, up 2% compared to $20.4 million in Q2/19 due to improved sales mix.

The company's CEO, Joseph F. Puishys, commented, "We delivered solid operational and financial performance in Q2/20, with results largely in-line with our expectations...Our Architectural Glass segment made significant year-over-year improvements, with increased revenue and margins, and Architectural Services continued to build on its record backlog. We also made substantial progress toward completing the last remaining legacy EFCO project, tracking as expected to our schedule and cost estimates. We are delivering on our commitments and see positive momentum in our business...Looking forward, we remain confident that our strategy to diversify revenue streams, broaden our growth opportunities, and improve the efficiency and productivity of our operations positions the company well for future earnings growth and more consistent operating performance...During the quarter we progressed on a number of initiatives to advance this strategy. We completed a facility upgrade that we expect to significantly enhance productivity and margins in our EFCO business. We also began to implement plans to enhance profitability across the entire Framing Systems segment and took initial steps to increase supply chain integration, reduce procurement costs, and optimize our facility footprint. Finally, we made significant progress on a new operation that will be focused on the short lead-time segment of the architectural glass market, which continues our efforts to diversify our business mix and provide new opportunities for long-term growth."

In the release, Apogee advised that fiscal year-to-date it has returned $29.2 million of cash to shareholders through share repurchases and dividend payments, up from $8.8 million in the prior year period. Additionally, the company reduced its total debt during Q2/20 by $20 million to $273 million, compared to $293 million at the end of Q1/20.

The company also reaffirmed guidance for FY/20. For the full-year FY/20 the company continues to expect revenue growth of 1–3% and operating margins of 8.2–8.6%. Diluted earnings per share are estimated to be in the range of $3.00–$3.20, which excludes the possible benefit of any potential expense recovery associated with the EFCO-related charges the company recorded in the previous fiscal year.

Apogee Enterprises was founded in 1949 and is headquartered in Minneapolis, Minn. Apogee is a $1.1 billion market cap company engaged in the design and development of distinctive glass solutions for enclosing commercial buildings and framing art. The firm operates through four main business segments: Architectural Glass, which fabricates coated glass used in customized window and wall systems; Architectural Services, which designs, engineers, fabricates and installs the walls of glass, windows and other curtain wall products making up the outside skin of commercial and institutional buildings; Architectural Framing Systems, which designs, engineers, fabricates and finishes the aluminum frames used in customized aluminum and glass window, curtain wall, storefront and entrance systems; and Large-Scale Optical Technologies, which manufactures value-added glass and acrylic products for custom picture framing and fine art displays.

Shares of Apogee Enterprises opened today at $44.50 (+$3.26, +7.90%) over yesterday's $41.24 closing price. The stock has traded today between $42.84 and $46.39/share and at present is trading at $46.39 (+$5.15, +12.49%).


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