Apogee Enterprises’ FY12 third quarter revenues were up 19%, and the company expects to be slightly profitable for the fourth quarter of fiscal 2012.
Apogee Enterprises, Inc. announced fiscal 2012 third-quarter results on 14 December.
FY12 third quarter vs. prior-year period revenues of USD 174.9 million were up 19%. Operating income totalled USD 7.2 million, compared to a loss of USD 1.8 million, while per share earnings were USD 0.20, compared to a loss of USD 0.08.
Architectural segment revenues increased 21%, with operating income of USD 0.6 million compared to a loss of USD 8.4 million. Backlog was maintained at USD 231 million from the second quarter, and the large-scale optical segment revenues increased 6%, with operating income consistent at USD 7.4 million.
“I am pleased to report very positive results for the third quarter, as we returned to quarterly earnings and grew revenues significantly,” said Joseph F. Puishys, Apogee chief executive officer. “The architectural segment moved to profitability on strong third-quarter revenues and maintained its backlog on increased order flow, and the large-scale optical segment revenues increased. We achieved excellent top-line growth in both segments, given current market conditions.
“During the quarter, we also had solid balance sheet performance with cash flow from operations of USD 10 million,” he said. “In addition, we maintained our cash and short-term investments position from the second quarter after using USD 2.4 million in cash to repurchase shares in the current period.”
Architectural Products and Services revenues of USD 152.1 million were up 21%, with 7 percentage points of the increase coming from the addition of the Brazilian architectural glass business acquired in the fourth quarter of fiscal 2011. The remaining growth was split between increased volume in the window and storefront businesses, and improved architectural glass pricing.
Operating earnings were USD 0.6 million, compared to a loss of USD 8.4 million. Results improved from the prior-year period with higher architectural glass pricing and leverage on volume growth, partially offset by lower margin work in the installation business, and the Brazilian architectural glass business was slightly accretive in the quarter, as expected.
Backlog was USD 230.7 million, compared to USD 231.3 million in the second quarter and USD 165.7 million in the prior-year period. Approximately USD 96 million, or 41%, of the backlog is expected to be delivered in fiscal 2012; approximately USD 126 million, or 55%, in fiscal 2013; and approximately USD 9 million, or 4% in fiscal 2014.
Awarded projects awaiting final signed contracts held at the second quarter level of approximately USD 60 million.
Large-Scale Optical Technologies revenues of USD 22.8 million were up 6% with increased sales to independent framers, and operating income was maintained at USD 7.4 million.
Operating margin in the seasonally strong quarter declined to 32.5%, compared to 34.5%, due to spending on growth initiatives.
Long-term debt, which includes USD 20.4 million in long-term, low-interest industrial revenue and recovery zone facility bonds, was USD 21.0 million, compared to USD 21.4 million at the end of fiscal 2011.
Cash and short-term investments totalled USD 46.4 million, compared to USD 45.3 million at the end of the second quarter and USD 60.6 million at the end of fiscal 2011. Non-cash working capital (current assets, excluding cash and short-term investments, less current liabilities) was USD 70.9 million, compared to USD 68.2 million at the end of the second quarter, and USD 39.4 million at the end of fiscal 2011.
Capital expenditures year-to-date were USD 6.2 million, down 18% from the prior-year period, while depreciation and amortization year-to-date were USD 20.6 million, comparable to the prior-year period.
Third-quarter tax expense included a benefit of approximately USD 1 million from finalization of previous tax positions.
“With the strong third-quarter performance, we have increased our fiscal 2012 full-year outlook,” Puishys said. “We now anticipate that revenues will increase approximately 14%, up from prior expectations of more than 10% growth, and our full-year earnings per share should be at least USD 0.07. We also expect to generate positive cash flow from operations in fiscal 2012.
“We expect to be slightly profitable for the fourth quarter of fiscal 2012, as we anticipate that our fourth quarter revenues will be down sequentially from the third quarter due to architectural project timing and large-scale optical seasonality,” he said. “That said, we expect to deliver revenue and income growth in the fourth quarter, compared to the prior-year period.” He added that Apogee continues to see good bidding activity.
“I am encouraged that Apogee’s performance is improving, in part driven by operational improvements we are making, and look forward to executing strategies to grow our business at home and internationally as we move ahead,” he said.