Apogee Enterprises Reports Fiscal 2021 Second-Quarter Results

Apogee Enterprises, Inc. (“Apogee”) announced results for the second quarter of fiscal 2021 and provided a business update.

Second-quarter revenue was $319.5 million, compared to $357.1 million in the second quarter of fiscal year 2020, reflecting COVID-19 and market related volume declines in three of the company’s segments. Earnings were $0.67 per diluted share, compared to $0.72 per diluted share in the prior year period, reflecting the lower revenue, partially offset by cost savings and improved productivity. Adjusted earnings were $0.73 per diluted share, compared to $0.72 in the prior year. Adjusted results excluded $2.3 million of pre-tax costs related to COVID-19 and acquired project matters.

“Our team turned in impressive results in the second quarter, delivering adjusted earnings growth despite a challenging economic situation,” said Joseph F. Puishys, Chief Executive Officer. “As we forecasted last quarter, each of our four segments delivered increased revenue and profitability in the second quarter compared to the first quarter. Large-Scale Optical recovered sharply from the first quarter, returning to profitability, and we benefited from strong execution and effective cost and cash management across our business.”

Mr. Puishys continued, “While conditions in our end markets remain uncertain, Apogee is well positioned to navigate the current environment. Over the past several years, we have successfully diversified our business to enable more stable performance, moving from a concentration in high-rise buildings toward a more balanced customer offering across project types and building sizes. We’ve built a robust backlog, providing visibility in the long lead-time parts of our business. We’ve driven sustainable cost reductions and improved productivity, with additional opportunities for further gains. Finally, our strong balance sheet and cash flow provide significant financial flexibility to drive future growth and shareholder value.”

Mr. Puishys concluded, “I want to once again thank all of Apogee’s employees for their tremendous efforts and sacrifices over the past several months. Our team has taken decisive action to stabilize our business in response to COVID-19. Looking ahead, we will remain focused on the health and safety of our employees and supporting our customers, as we position the company to emerge stronger when the economy recovers.”

Segment Results

Architectural Framing Systems

Architectural Framing Systems second-quarter revenue was $152.9 million, compared to $187.4 million in the prior year period, primarily reflecting COVID-19 related project delays and lower order volume. Operating income in the quarter was $11.7 million, with operating margin of 7.6 percent, compared to $15.5 million and 8.3 percent respectively in the prior year quarter, reflecting the lower revenue, partially offset by cost reductions and improved productivity. Segment backlog stands at $404 million, compared to $423 million a quarter ago.

Architectural Glass

Architectural Glass revenue in the second quarter was $86.6 million, compared to $99.1 million in the prior year quarter, primarily reflecting lower volumes due to COVID-19 related project delays and lower order volume. The segment had operating income of $5.0 million and operating margin of 5.7 percent, compared to operating income of $6.5 million and margin of 6.5 percent in last year’s second quarter, reflecting the lower volume, partially offset by strong factory productivity and effective cost management.

Architectural Services

Architectural Services revenue grew 20 percent to $73.7 million, compared to $61.6 million in the prior-year quarter, as the segment executed projects in its substantial backlog. Second-quarter operating income increased to $6.6 million with operating margin of 8.9 percent, up from $4.0 million and 6.5 percent respectively in the prior-year period, primarily driven by strong project execution, and effective cost management. Segment backlog decreased to $665 million, compared to the record level of $685 million last quarter, but remains 32 percent above last year’s level of $502 million.

Large-Scale Optical

Large-Scale Optical revenue was $16.9 million, down from $20.8 million in the second quarter last year, on lower volume. By the end of the second quarter, the segment’s customers had largely reopened, after having been closed for most of the first quarter due to COVID-19 related restrictions. In addition, the segment’s two primary manufacturing locations resumed normal operations during the quarter, after being closed for most of the first and second quarters. Segment operating income was $2.1 million with operating margin of 12.7 percent, compared to $4.6 million and 22.3 percent respectively in last year’s second quarter, reflecting reduced leverage on the lower revenue, partially offset by effective cost management.

Financial Condition

Fiscal year-to-date, net cash provided by operating activities is $85.3 million, up $68 million compared to $17.8 million in the first half of fiscal 2020, primarily driven by strong working capital management. Capital expenditures through the first half of the fiscal year were $14.2 million, down from $22.6 million in the prior-year period, as the company focused only on high return and essential capital projects. Fiscal year-to-date, the company has returned $14.5 million to shareholders through dividend payments and share repurchases. The company did not repurchase any stock in the second quarter.

During the quarter, the company reduced its total debt by $43 million, to $168 million. Over the past year, the company has reduced its total debt by $105 million.

For the full first quarter results, click here.

About Apogee Enterprises

Apogee Enterprises, Inc. (Nasdaq: APOG) delivers distinctive solutions for enclosing commercial buildings and framing art. Headquartered in Minneapolis, MN, we are a leader in architectural products and services, providing architectural glass, aluminum framing systems and installation services for buildings, 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.