Core Points - Astec Industries, Inc. declared a quarterly dividend of $0.13 per share, payable on or about August 30, 2024, to shareholders of record as of the close of business on August 12, 2024 [1] Company Overview - Astec is a manufacturer of specialized equipment for asphalt road building, aggregate processing, and concrete production [1] - The company's manufacturing operations are divided into two primary business segments: - Infrastructure Solutions, which includes road building, asphalt and concrete plants, thermal and storage solutions - Materials Solutions, which includes aggregate processing equipment [1]

CHATTANOOGA, Tenn., July 15, 2024 (GLOBE NEWSWIRE) -- You are invited by Astec Industries, Inc. (NASDAQ:ASTE) to participate in a conference call to review the company’s second quarter 2024 financial results. Astec Industries, Inc. will be releasing the company’s second quarter results to the wire service on Wednesday, August 7, 2024 at approximately 7:00 a.m. Eastern Time. The live call will begin on Wednesday, August 7, 2024 at 8:30 a.m. Eastern Time. Jaco van der Merwe, President and Chief Executive Offi ...

Core Viewpoint - Astec Industries, Inc. is set to release its second quarter 2024 financial results on August 7, 2024, followed by a conference call to discuss these results [1]. Group 1: Financial Results Announcement - The financial results will be released to the wire service at approximately 7:00 a.m. Eastern Time on August 7, 2024 [1]. - A live conference call will take place at 8:30 a.m. Eastern Time on the same day, hosted by key executives including the President and CEO, Interim CFO, and Senior VP of Administration and Investor Relations [1]. Group 2: Access Information - Participants can access the call by dialing (888) 440-4118 or (646) 960-0833 for international callers, at least 10 minutes prior to the scheduled time [1]. - A live webcast will also be available, with an archived version accessible for ninety days post-call [1][2]. Group 3: Company Overview - Astec is a manufacturer specializing in equipment for asphalt road building, aggregate processing, and concrete production, divided into two primary business segments: Infrastructure Solutions and Materials Solutions [3].

Core Viewpoint - Investors in Astec Industries, Inc. (ASTE) should closely monitor the stock due to significant movements in the options market, particularly the high implied volatility of the Dec 20, 2024 $22.5 Put option [1] Company Analysis - Astec Industries is currently rated as a Zacks Rank 5 (Strong Sell) within the Manufacturing - Construction and Mining industry, which is positioned in the bottom 23% of the Zacks Industry Rank [3] - Over the past 60 days, no analysts have increased earnings estimates for the current quarter, while one analyst has decreased the estimates, leading to a reduction in the Zacks Consensus Estimate from 84 cents per share to 72 cents [3] Options Market Insights - The high implied volatility in Astec's options suggests that traders are anticipating a significant price movement, which could indicate an upcoming event that may lead to a substantial rally or sell-off [2][3] - Options traders often seek to capitalize on high implied volatility by selling premium, aiming for the underlying stock to not move as much as initially expected by expiration [3]

Core Points - The United States District Court for the Eastern District of Tennessee has approved a proposed class action settlement for purchasers of Astec Industries, Inc. common stock [1] - The settlement amount is $13,700,000, and a hearing is scheduled for September 5, 2024, to determine the fairness and adequacy of the settlement [5] - The settlement affects individuals who purchased Astec common stock between July 26, 2016, and October 22, 2018 [4][6] Settlement Details - The proposed settlement includes a plan for distributing the settlement proceeds, which will be evaluated for fairness [5] - Lead Counsel is requesting attorneys' fees of up to one-third of the settlement amount, plus interest, and reimbursement of expenses not exceeding $330,000 [5] - A service payment of no more than $15,000 is proposed for the Lead Plaintiff [5] Claim Process - Individuals wishing to participate in the settlement must submit a Claim Form by August 8, 2024 [6] - Those who wish to be excluded from the settlement class must also submit a request for exclusion by the same date [7] - Objections to the settlement must be submitted by August 8, 2024, following the procedures outlined in the detailed Notice [7]

Core Insights - Astec Industries, Inc. will participate in the Stifel 2024 Cross Sector Insight Conference on June 4th and 5th, 2024 [1] - Key executives including the President and CEO, Interim CFO, and Senior VP of Investor Relations will present and engage in one-on-one meetings [1] - The presentation is scheduled for June 4, 2024, from 4:45 to 5:15 PM Eastern time [1] Company Overview - Astec is a manufacturer of specialized equipment for asphalt road building, aggregate processing, and concrete production [2] - The company's operations are divided into two main segments: Infrastructure Solutions and Materials Solutions [2] - Infrastructure Solutions includes road building, asphalt and concrete plants, and thermal and storage solutions, while Materials Solutions encompasses aggregate processing and mining equipment [2]

Astec Industries, Inc. (ASTE) reported first-quarter 2024 adjusted earnings per share of 34 cents, missing the Zacks Consensus Estimate of 87 cents. The bottom line also marked a 62% decline from earnings per share of 90 cents in the prior-year quarter.Including one-time items, the company’s earnings of 15 cents per share in the quarter under review compared with earnings of 53 cents in the year-ago quarter.Revenues & BacklogAstec’s revenues decreased 11.1% year over year to $309 million in the quarter unde ...

Financial Performance - Net sales for Q1 2024 were $309.2 million, a decrease of 11.1% from $347.9 million in Q1 2023[87] - Gross profit for Q1 2024 was $76.9 million, representing 24.9% of net sales, down from $89.2 million or 25.6% in Q1 2023, a decrease of 13.8%[99] - Net income attributable to Astec decreased by $8.7 million to $3.4 million in Q1 2024, with diluted earnings per share falling 71.7% to $0.15[87] - Domestic sales in Q1 2024 were $243.2 million, accounting for 78.7% of consolidated net sales, down 13.5% from $281.3 million in Q1 2023[97] Backlog and Orders - Backlog as of March 31, 2024, was $559.8 million, a decrease of 30.0% from $800.2 million a year earlier[106] - The company experienced a decrease in order backlog driven by macroeconomic factors such as higher inflation and increased interest rates[107] Segment Performance - Infrastructure Solutions segment sales decreased to $202.2 million in Q1 2024 from $215.5 million in Q1 2023, a decline of $13.3 million or 6.2%[109] - Materials Solutions segment sales fell to $107.0 million in Q1 2024 from $132.2 million in Q1 2023, a decrease of $25.2 million or 19.1%[111] - Domestic sales in the Infrastructure Solutions segment decreased by $6.1 million or 3.2% in Q1 2024 compared to Q1 2023, while international sales dropped by $7.2 million or 30.6%[110] - Segment Operating Adjusted EBITDA for Infrastructure Solutions was $25.6 million in Q1 2024, down from $28.5 million in Q1 2023, a decrease of $2.9 million or 10.2%[115] - Segment Operating Adjusted EBITDA for Materials Solutions decreased to $5.3 million in Q1 2024 from $14.6 million in Q1 2023, a decline of $9.3 million or 63.7%[116] Expenses and Costs - Selling, general and administrative expenses increased by $3.5 million, or 5.2%, to $71.4 million in Q1 2024, representing 23.1% of net sales[100] - Interest expense rose to $2.7 million in Q1 2024 from $2.0 million in Q1 2023, primarily due to higher average outstanding borrowings[103] - The company anticipates total costs for ERP implementation to be between $125 million and $150 million, with annual costs of $25 to $30 million expected through 2025[88] - The company has capitalized $34.5 million in deferred implementation costs related to the ERP system, which are being amortized over the contract term[90] Liquidity and Cash Flow - Total liquidity as of March 31, 2024, was $170.5 million, consisting of $55.3 million in cash and cash equivalents and $115.2 million available for additional borrowings[118] - Net cash used in operating activities increased by $27.8 million in Q1 2024 compared to Q1 2023, primarily due to higher cash usages for operating assets and liabilities[127] - Net cash provided by financing activities was $48.4 million in Q1 2024, compared to a net cash use of $16.2 million in Q1 2023, primarily due to increased borrowings[130] Capital Expenditures and Share Repurchase - The company anticipates capital expenditures between $25.0 million and $35.0 million for the year ending December 31, 2024[124] - As of March 31, 2024, $115.7 million remains available for repurchase under the approved share repurchase program[132] Current Assets and Liabilities - Total current assets increased to $778.8 million as of March 31, 2024, from $719.5 million as of December 31, 2023, representing an increase of $59.3 million, or 8.2%[133] - Total current liabilities rose to $310.4 million as of March 31, 2024, from $299.0 million as of December 31, 2023, an increase of $11.4 million, or 3.8%[134] - The increase in current assets was primarily due to a $39.3 million rise in trade and other receivables, including a $13.7 million receivable related to a pending litigation settlement[133] - Inventory increased by $28.4 million, while cash, cash equivalents, and restricted cash decreased by $5.1 million[133] - The rise in current liabilities was mainly due to a net increase of $11.3 million in other current liabilities, including $13.7 million related to the pending litigation settlement[134] - Customer deposits increased by $9.8 million, partially offset by a decrease of $8.0 million in accrued employee-related liabilities[134] Market Risk - Market risk exposures have not materially changed since the Annual Report on Form 10-K for the year ended December 31, 2023[135]

Financial Data and Key Metrics Changes - The company reported net sales of $309.2 million, a decrease of 11.1% compared to the previous year, primarily due to finance capacity constraints and supply chain delays [22][24] - Gross margin was reported at 24.9%, with adjusted EBITDA declining by 46.3% to $18.9 million, and adjusted EBITDA margin decreasing by 400 basis points to 6.1% [23][26] - Adjusted EPS was $0.34, down 62.2% from $0.90 in the prior year, while GAAP EPS was $0.15 compared to $0.53 [23][24] Business Line Data and Key Metrics Changes - Infrastructure Solutions net sales decreased by 6.2% to $202.2 million, impacted by supply chain delays, while parts sales increased by 17.7% [14][24] - Materials Solutions net sales fell by 19.1% to $107 million, driven by lower equipment sales and finance capacity constraints [15][25] - Segment operating adjusted EBITDA margin for Infrastructure Solutions decreased by 50 basis points to 12.7%, while Materials Solutions saw a decrease of 600 basis points to 5% [14][15] Market Data and Key Metrics Changes - Domestic sales decreased by 13.5% or $38.1 million, while international sales saw a slight decrease of 0.9% or $0.6 million [22] - Federal highway and pavement contract awards increased by 11% year-over-year, with total state budgets up 12% year-over-year, indicating strong demand for asphalt and concrete production equipment [15] Company Strategy and Development Direction - The company is transitioning to a new strategic framework focused on empowering employees, customer-centric innovation, and operational excellence [11][12] - The new strategic roadmap aims to build on past successes and drive sustainable value creation through innovation and improved operational efficiencies [12][13] - The company is taking actions to address challenges in the Materials Solutions segment through targeted cost reduction initiatives [7][8] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging first quarter due to market headwinds but expressed optimism about strong demand for asphalt and concrete plants moving forward [9][10] - The company anticipates that supply chain issues will lessen as 2024 progresses, and they are encouraged by the positive sentiment from customers [10][28] - Management remains confident in the fundamentals of the business, particularly in Infrastructure Solutions, and expects to see improved margins in the future [28] Other Important Information - The company's backlog approached historic levels at $559.8 million, with Infrastructure Solutions backlog at $372.7 million, a 2.1% increase sequentially [10][17] - The company has a disciplined capital deployment framework, with $5.8 million spent on capital expenditures in Q1 to enhance capacity and efficiency [27] Q&A Session Summary Question: How did the quarter progress, and what are the expectations for April? - Management noted that shipments in Materials Solutions were slower than expected, but parts sales were strong. April showed encouraging order intake for asphalt and concrete plants [30][31] Question: Can you clarify the revenue outlook given the current order intake? - Management reaffirmed the outlook of flat to single-digit revenue growth, emphasizing the importance of Infrastructure Solutions, which constitutes two-thirds of the business [32][33] Question: What are the expectations for margins in the Materials Solutions segment? - Management indicated that while margins were under pressure, they expect improvements as inventory issues are resolved and market conditions stabilize [34][35] Question: What are the supply chain challenges faced in Q1? - Management highlighted specific electronic components as a challenge but noted that alternative suppliers are being sourced to mitigate future risks [52][53] Question: How is the company addressing cash conversion and receivables? - Management acknowledged an increase in receivables due to strong parts sales and emphasized the quality of receivables, indicating low risk in aging [56][60] Question: What is the competitive environment like regarding pricing? - Management observed that larger competitors are offering attractive financing options, but they are managing pricing proactively and expect stable pricing moving forward [64][66]

Sales Performance - Net sales decreased 11.1% to $309.2 million, with domestic sales down 13.5% and international sales down 0.9%[3] - Net sales for Q1 2024 decreased to $309.2 million, down 11.1% from $347.9 million in Q1 2023[17] - Infrastructure Solutions segment net sales declined by 6.2% to $202.2 million, while Materials Solutions segment net sales dropped 19.1% to $107.0 million[19] - Net sales for Q1 2024 were $309.2 million, a decrease from $347.9 million in Q1 2023[32] Backlog and Orders - Backlog decreased 30.0% to $559.8 million, with domestic backlog down 36.2% and international backlog up 6.6%[3] - Implied orders increased 2.4% sequentially from the fourth quarter[1] Earnings and Profitability - Diluted EPS of $0.15 compared to $0.53; Adjusted EPS of $0.34 compared to $0.90[1] - Net income attributable to controlling interest fell to $3.4 million in Q1 2024, compared to $12.1 million in Q1 2023[17] - Segment Operating Adjusted EBITDA decreased by 46.0% to $18.9 million in Q1 2024 from $35.2 million in Q1 2023[19] - Net income attributable to controlling interest for Q1 2024 was $3.4 million, compared to $12.1 million in Q1 2023[30] - Adjusted net income attributable to controlling interest for Q1 2024 was $7.8 million, down from $20.5 million in Q1 2023[30] - Diluted EPS for Q1 2024 was $0.15, compared to $0.53 in Q1 2023[30] - Adjusted EPS for Q1 2024 was $0.34, down from $0.90 in Q1 2023[30] - EBITDA for Q1 2024 was $13.4 million, compared to $24.3 million in Q1 2023[32] - EBITDA margin for Q1 2024 was 4.3%, down from 7.0% in Q1 2023[32] - Adjusted EBITDA for Q1 2024 was $18.9 million, compared to $35.2 million in Q1 2023[32] - Adjusted EBITDA margin for Q1 2024 was 6.1%, down from 10.1% in Q1 2023[32] Segment Performance - Infrastructure Solutions net sales decreased 6.2% to $202.2 million, with Segment Operating Adjusted EBITDA margin decreasing 50 basis points to 12.7%[6] - Materials Solutions net sales decreased 19.1% to $107.0 million, with Segment Operating Adjusted EBITDA margin decreasing 600 basis points to 5.0%[7] Liquidity and Financial Position - Total liquidity was $170.5 million, consisting of $55.3 million in cash and cash equivalents and $115.2 million available under the revolving credit facility[8] - Total assets increased to $1,123.0 million as of March 31, 2024, up from $1,059.3 million at the end of 2023[24] - Long-term debt rose to $125.0 million as of March 31, 2024, compared to $72.0 million at the end of 2023[24] - Net cash used in operating activities was $47.0 million in Q1 2024, compared to $19.2 million in Q1 2023[26] - Cash, cash equivalents and restricted cash decreased to $58.1 million at the end of Q1 2024 from $63.2 million at the end of 2023[29] Capital Expenditures and Investments - Capital expenditure investments to increase capacity and improve efficiency were $5.8 million[9] Restructuring and Transformation Costs - Transformation program costs were $6.3 million in Q1 2024, down from $7.2 million in Q1 2023[23] - Restructuring and other related charges decreased to $0.1 million in Q1 2024 from $7.1 million in Q1 2023[23] Industry and Market Trends - Federal highway and pavement contract awards increased 11% year-over-year[1] - Record attendance at 2024 World of Asphalt/Agg1 trade show, with a 38% increase over the previous record set in 2022[4]