Apogee Enterprises Reports Fiscal 2024 First Quarter Results

Apogee Enterprises, Inc. (the “Company”) announced its fiscal 2024 first-quarter results. Net sales grew 1.4% to $361.7 million, led by strong growth in Architectural Glass, partially offset by lower net sales in Architectural Services. Diluted earnings per share (“EPS”) increased 5% to $1.05, primarily driven by improved profitability in Architectural Glass.

Ty R. Silberhorn, Chief Executive Officer, stated, “The first quarter was a solid start to our fiscal year, with top and bottom-line growth and strong cash flow. We are raising our EPS outlook for the fiscal year, as we continue to build on the positive trends we established last year.”

Mr. Silberhorn continued, “Our first quarter results were led by exceptional performance in Architectural Glass, building on our progress over the past two years. Through executing our strategy, we’ve driven sustainable cost and productivity improvements, and shifted our sales mix to emphasize premium solutions that leverage our unique capabilities. These efforts are transforming Glass from an underperforming business to an economic leader that is delivering significantly improved profitability. Framing Systems and Large-Scale Optical both continue to deliver strong execution and operating margins above our targeted levels, while results in Architectural Services were below our expectations this quarter.”

Mr. Silberhorn concluded, “Execution of our strategy continues to drive improved financial performance. We believe our strong market position, improving operational execution, and focus on differentiated product and service offerings will position us to deliver stronger results throughout the market cycle.”

Segment Results – First Quarter Fiscal 2024 Compared to First Quarter Fiscal 2023

Architectural Framing Systems

Architectural Framing Systems net sales grew 0.5%, to $164.2 million, driven by improved pricing and mix, which offset lower volume, as the segment continued to increase focus on target markets where it provides differentiated offerings. Operating income was $19.9 million, or 12.1% of net sales, compared to $23.7 million, or 14.5% of net sales. Operating income in the prior-year quarter benefited from the favorable timing of inventory flows and aluminum prices, which did not repeat in this year’s first quarter. Segment backlog² at the end of the quarter was $221 million, compared to $243 million at the end of the fourth quarter of fiscal 2023.

Architectural Glass

Architectural Glass net sales grew 27.5%, to $97.2 million, driven by improved pricing, higher volume, and a more favorable sales mix, reflecting the segment’s strategic shift to emphasize premium, high-performance products. Operating income increased to $16.5 million, or 17.0% of net sales, compared to $5.2 million, or 6.8% of net sales. The higher operating income was primarily driven by improved pricing, favorable mix, and increased volume, partially offset by cost inflation.

Architectural Services

Architectural Services net sales were $89.4 million, compared to $103.4 million, primarily reflecting lower project volume. The segment had an operating loss of $(0.6) million, primarily due the impact of lower estimated profitability levels on certain projects, the impact of lower project volume, and severance costs related to a facility closure. Segment backlog ended the quarter at $709 million, compared to $727 million at the end of the fourth quarter of fiscal 2023.

Large-Scale Optical

Large-Scale Optical net sales were $22.5 million, compared to $25.2 million, primarily reflecting lower volume due to timing of customer orders and customer inventory destocking. Operating income was $5.5 million, or 24.6% of net sales, compared to $6.5 million, or 25.8% of net sales, primarily reflecting the impact of lower net sales.

Financial Condition

Net cash provided by operating activities was $21.3 million, compared to a use of cash of $30.5 million in last year’s first quarter. The improved cash flow was primarily driven by lower working capital requirements compared to the prior year. Capital expenditures were $7.4 million, compared to $5.1 million last year, as the Company increased investments in projects to support its strategy. During the quarter, the Company returned $10.4 million of cash to shareholders through share repurchases and dividend payments.

Quarter-end total debt was $170.7 million, down from $261.0 million at the end of last year’s first quarter. Cash and cash equivalents were $24.6 million, compared to $15.2 million at the end of the first quarter of fiscal 2023.

Outlook

The Company is raising its outlook for full-year diluted EPS to a range of $4.15 to $4.45, up from the previously announced range of $3.90 to $4.25. As a reminder, fiscal 2024 will be a 53-week year, with an extra week in the fourth quarter. Including the extra week of operations, the Company continues to expect flat to slightly declining net sales compared to fiscal 2023, primarily reflecting expected lower volume in Architectural Services and Architectural Framing Systems, partially offset by expected net sales growth in Architectural Glass. The Company continues to expect a long-term average tax rate of approximately 24.5% and capital expenditures in fiscal 2024 between $50 to $60 million.

For the full first quarter results, click here.

¹ See Use of Non-GAAP Financial Measures and a reconciliation to the most directly comparable GAAP measures later in this press release.
² Backlog is a non-GAAP financial measure. See Use of Non-GAAP Financial Measures later in this press release for more information.

About Apogee Enterprises

Apogee Enterprises, Inc. (Nasdaq: APOG) is a leading provider of architectural products and services for enclosing buildings, and high-performance glass and acrylic products used for preservation, energy conservation, and enhanced viewing. Headquartered in Minneapolis, MN, our portfolio of industry-leading products and services includes high-performance architectural glass, windows, curtainwall, storefront and entrance systems, integrated project management and installation services, as well as value-added glass and acrylic for custom picture framing and displays. For more information, visit www.apog.com.

Contact:

Jeff Huebschen – Vice President, Investor Relations & Communications – ir@apog.com – (952) 487-7538

Source: Apogee Enterprises, Inc.