[Part I. FINANCIAL INFORMATION](index=3&type=section&id=Part%20I.%20FINANCIAL%20INFORMATION) This section provides a comprehensive overview of the company's financial performance and condition, including detailed financial statements, management's analysis, market risk disclosures, and internal controls [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited Consolidated Financial Statements for Acuity Brands, Inc. as of May 31, 2024, including Balance Sheets, Statements of Comprehensive Income, and Statements of Cash Flows, along with 20 detailed notes providing context and explanation for the financial data [Consolidated Financial Statements (Tables)](index=3&type=section&id=Consolidated%20Financial%20Statements%20(Tables)) The core financial statements show a strong liquidity position with a significant increase in cash and cash equivalents, while net sales saw a slight decline, net income and earnings per share increased, driven by improved gross margins and lower operating expenses Consolidated Balance Sheet Highlights (in millions) | Account | May 31, 2024 (Unaudited) | August 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $699.0 | $397.9 | | Total current assets | $1,674.0 | $1,395.2 | | Total assets | $3,642.9 | $3,408.5 | | Total current liabilities | $605.3 | $595.4 | | Total liabilities | $1,388.2 | $1,393.1 | | Total stockholders' equity | $2,254.7 | $2,015.4 | Consolidated Statements of Comprehensive Income Highlights (in millions, except per share data) | Metric | Three Months Ended May 31, 2024 | Three Months Ended May 31, 2023 | Nine Months Ended May 31, 2024 | Nine Months Ended May 31, 2023 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $968.1 | $1,000.3 | $2,808.7 | $2,941.8 | | Gross profit | $452.2 | $447.3 | $1,293.0 | $1,270.5 | | Operating profit | $145.3 | $143.3 | $396.3 | $363.7 | | Net income | $113.9 | $105.0 | $303.7 | $263.1 | | Diluted earnings per share | $3.62 | $3.28 | $9.67 | $8.13 | Consolidated Statements of Cash Flows Highlights (in millions) | Metric | Nine Months Ended May 31, 2024 | Nine Months Ended May 31, 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $445.1 | $471.5 | | Net cash used for investing activities | $(44.6) | $(76.4) | | Net cash used for financing activities | $(100.5) | $(258.7) | | Net change in cash and cash equivalents | $301.1 | $136.1 | [Notes to Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail the company's business structure, recent corporate activities, and segment performance, with Acuity operating through two segments: Acuity Brands Lighting (ABL) and Intelligent Spaces Group (ISG), showing ABL sales decreased while ISG sales grew - The company operates through two business segments: Acuity Brands Lighting and Lighting Controls (ABL) and the Intelligent Spaces Group (ISG)[18](index=18&type=chunk) - On January 19, 2024, the company acquired certain assets related to Arize® horticulture lighting products, which were included in the ABL segment's results[28](index=28&type=chunk) - There were no divestitures in the first nine months of fiscal 2024, with the company selling its Sunoptics business in November 2022, recognizing a pre-tax loss of **$11.2 million** in fiscal 2023[32](index=32&type=chunk) Segment Net Sales (in millions) | Segment | Three Months Ended May 31, 2024 | Three Months Ended May 31, 2023 | Nine Months Ended May 31, 2024 | Nine Months Ended May 31, 2023 | | :--- | :--- | :--- | :--- | :--- | | ABL | $898.5 | $940.7 | $2,618.4 | $2,778.6 | | ISG | $75.7 | $65.8 | $208.0 | $180.8 | Segment Operating Profit (in millions) | Segment | Three Months Ended May 31, 2024 | Three Months Ended May 31, 2023 | Nine Months Ended May 31, 2024 | Nine Months Ended May 31, 2023 | | :--- | :--- | :--- | :--- | :--- | | ABL | $151.5 | $150.0 | $421.3 | $391.7 | | ISG | $12.5 | $8.6 | $26.9 | $22.7 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial health, highlighting a strong liquidity position with **$699.0 million** in cash and total liquidity of **$1.3 billion**, with improved gross margins leading to an **8.5%** increase in net income despite a **3.2%** decrease in Q3 net sales [Financial Condition, Capital Resources, and Liquidity](index=21&type=section&id=Financial%20Condition,%20Capital%20Resources,%20and%20Liquidity) The company's financial condition remains robust, with cash increasing by **$301.1 million** to **$699.0 million** since August 2023, driven by **$445.1 million** in operating cash flow, and total liquidity standing at **$1.3 billion** - Cash position increased by **$301.1 million** from August 31, 2023, to **$699.0 million** at May 31, 2024[111](index=111&type=chunk) - Generated **$445.1 million** in cash from operating activities during the first nine months of fiscal 2024[111](index=111&type=chunk) - Total liquidity as of May 31, 2024, was **$1.3 billion**, comprising cash on hand and **$596.2 million** of available borrowing capacity under the Revolving Credit Facility[113](index=113&type=chunk) - Repurchased **0.5 million** shares of common stock for **$88.3 million** and paid dividends of **$13.4 million** during the first nine months of fiscal 2024[123](index=123&type=chunk)[124](index=124&type=chunk) [Results of Operations](index=25&type=section&id=Results%20of%20Operations) For Q3 2024, net sales decreased **3.2%** to **$968.1 million**, but gross profit margin expanded by **200 basis points** to **46.7%**, leading to a **1.4%** rise in operating profit and a **10.4%** increase in diluted EPS to **$3.62** Q3 FY2024 vs Q3 FY2023 Performance (in millions, except per share data) | Metric | Q3 2024 | Q3 2023 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $968.1 | $1,000.3 | (3.2)% | | Gross Profit Margin | 46.7% | 44.7% | +200 bps | | Operating Profit | $145.3 | $143.3 | 1.4% | | Net Income | $113.9 | $105.0 | 8.5% | | Diluted EPS | $3.62 | $3.28 | 10.4% | Nine Months FY2024 vs FY2023 Performance (in millions, except per share data) | Metric | YTD 2024 | YTD 2023 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $2,808.7 | $2,941.8 | (4.5)% | | Gross Profit Margin | 46.0% | 43.2% | +280 bps | | Operating Profit | $396.3 | $363.7 | 9.0% | | Net Income | $303.7 | $263.1 | 15.4% | | Diluted EPS | $9.67 | $8.13 | 18.9% | - In Q3 2024, ABL segment net sales decreased **4.5%** to **$898.5 million**, while ISG segment net sales increased **15.0%** to **$75.7 million**[136](index=136&type=chunk)[137](index=137&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=29&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company states that there have been no material changes to its exposure to market risks, which include fluctuations in interest rates, foreign exchange rates, and commodity prices, since the disclosures in its last Annual Report on Form 10-K - There have been no material changes to the company's exposure to market risks from those disclosed in the Form 10-K for the fiscal year ended August 31, 2023[155](index=155&type=chunk) [Item 4. Controls and Procedures](index=30&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of May 31, 2024, with no material changes in internal control over financial reporting identified during the quarter - Based on an evaluation as of May 31, 2024, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures are effective[157](index=157&type=chunk) - No material changes to the company's internal control over financial reporting were identified during the most recently completed fiscal quarter[159](index=159&type=chunk) [Part II. OTHER INFORMATION](index=31&type=section&id=Part%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity security sales, other general information, and a list of exhibits filed with the report [Item 1. Legal Proceedings](index=31&type=section&id=Item%201.%20Legal%20Proceedings) This section references the 'Commitments and Contingencies' footnote for details on legal matters, noting a class action lawsuit related to 2020 and 2021 data security incidents was settled with court approval on May 21, 2024, with no material financial impact - A class action complaint filed regarding data security incidents in October 2020 and December 2021 has been settled[65](index=65&type=chunk)[66](index=66&type=chunk) - The court approved the settlement on May 21, 2024, with an effective date of June 25, 2024, and the impact of the settlement was not material to the company's financials[66](index=66&type=chunk) [Item 1A. Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) The company reports that there have been no material changes to the risk factors previously disclosed in its Annual Report on Form 10-K - There have been no material changes in the company's risk factors from those disclosed in the Form 10-K[162](index=162&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The Board of Directors authorized an additional **three million** shares for the company's stock repurchase program on January 25, 2024, with **79,523** shares repurchased during the third fiscal quarter at an average price of **$260.07** - On January 25, 2024, the Board authorized the repurchase of an additional **three million** shares of common stock[163](index=163&type=chunk) Share Repurchases for the Quarter Ended May 31, 2024 | Metric | Value | | :--- | :--- | | Total Shares Purchased | 79,523 | | Average Price Paid per Share | $260.07 | | Shares Remaining for Repurchase | 3,775,637 | [Item 5. Other Information](index=31&type=section&id=Item%205.%20Other%20Information) The company confirms that during the third quarter of fiscal 2024, no directors or Section 16 officers adopted or terminated any Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements - During Q3 2024, no directors or Section 16 officers adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements[165](index=165&type=chunk) [Item 6. Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section provides a list of all exhibits filed with the Form 10-Q, including corporate governance documents and certifications by the CEO and CFO as required by the Sarbanes-Oxley Act - The report includes a list of exhibits, such as CEO and CFO certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002[168](index=168&type=chunk)[169](index=169&type=chunk)[170](index=170&type=chunk)

Core Insights - Acuity Brands, Inc. reported net sales of $968.1 million for the third quarter of fiscal 2024, reflecting a 3.2% decline compared to the previous year [1][24] - The company achieved an operating profit of $145.3 million, a 1.4% increase year-over-year, with an adjusted operating profit of $167.1 million, up 2.6% [2][28] - Diluted earnings per share (EPS) rose to $3.62, marking a 10.4% increase from the prior year, while adjusted diluted EPS reached $4.15, up 10.7% [3][30] - Year-to-date cash flow from operations totaled $445.1 million, a decrease of $26.4 million compared to the previous year [6] Financial Performance - The company’s operating profit margin improved to 15.0%, an increase of 70 basis points from the prior year, while the adjusted operating profit margin rose to 17.3%, up 100 basis points [2][28] - Acuity Brands Lighting and Lighting Controls (ABL) segment generated net sales of $898.5 million, down 4.5% year-over-year, with an operating profit of $151.5 million, a 1.0% increase [4][32] - The Intelligent Spaces Group (ISG) reported net sales of $75.7 million, a 15.0% increase, with an operating profit of $12.5 million, up 45.3% [5][29] Cash Flow and Capital Allocation - The company generated $445.1 million in cash flow from operations for the first nine months of fiscal 2024, down from $471.5 million in the prior year [6][21] - Acuity Brands repurchased approximately 454,000 shares of common stock for about $89 million year-to-date [6][21] Segment Analysis - ABL's net sales decreased by $42.2 million, while ISG's net sales increased by $9.9 million compared to the prior year [4][5] - ABL's adjusted operating profit was $162.1 million, reflecting a 1.5% increase, while ISG's adjusted operating profit rose to $17.3 million, a 35.2% increase [4][5][28]

Core Insights - Acuity Brands, Inc. reported net sales of $968.1 million for the third quarter of fiscal 2024, reflecting a 3.2% decline compared to the previous year [1][24] - The company achieved an operating profit of $145.3 million, a 1.4% increase year-over-year, with an adjusted operating profit of $167.1 million, up 2.6% [2][28] - Diluted earnings per share (EPS) rose to $3.62, marking a 10.4% increase from the prior year, while adjusted diluted EPS reached $4.15, up 10.7% [3][30] - Year-to-date cash flow from operations totaled $445.1 million, a decrease of $26.4 million compared to the previous year [6] Financial Performance - The company’s net sales decreased by $32.2 million, or 3.2%, compared to the prior year [1][24] - Operating profit as a percentage of net sales was 15.0%, an increase of 70 basis points from the previous year [2] - Adjusted operating profit margin improved to 17.3%, up 100 basis points year-over-year [2][28] - The gross profit for the third quarter was $452.2 million, compared to $447.3 million in the prior year [19] Segment Performance - Acuity Brands Lighting and Lighting Controls (ABL) segment generated net sales of $898.5 million, a decrease of 4.5% year-over-year [4][24] - ABL's operating profit was $151.5 million, reflecting a 1.0% increase, with an operating profit margin of 16.9% [4][28] - The Intelligent Spaces Group (ISG) reported net sales of $75.7 million, a 15.0% increase compared to the prior year, with an operating profit margin of 16.5% [5][29] Cash Flow and Capital Allocation - The company generated $445.1 million in cash flow from operations for the first nine months of fiscal 2024, down from $471.5 million in the prior year [6][22] - Acuity Brands repurchased approximately 454,000 shares of common stock for about $89 million year-to-date [6][22] Company Overview - Acuity Brands, Inc. is a market-leading industrial technology company focused on innovative products and services in lighting and building management solutions [8][9] - The company operates through two main segments: ABL and ISG, aiming to enhance customer-focused efficiencies and increase market share [8]

Core Viewpoint - Acuity Brands, Inc. has declared a quarterly dividend of 15 cents per share, payable on August 1, 2024, to shareholders of record on July 18, 2024 [1] Company Overview - Acuity Brands, Inc. is a market-leading industrial technology company focused on solving problems in spaces, light, and more [2] - The company operates through two business segments: Acuity Brands Lighting and Lighting Controls (ABL) and the Intelligent Spaces Group (ISG) [2] - Acuity Brands designs, manufactures, and markets products and services that significantly impact people's lives [2] - The company emphasizes growth through innovative product development, including lighting, lighting controls, building management solutions, and location-aware applications [2] - Acuity Brands aims to increase market share and deliver superior returns by achieving customer-focused efficiencies and aggressively deploying capital to enter attractive new verticals [2] Operational Footprint - Acuity Brands is headquartered in Atlanta, Georgia, with operations across North America, Europe, and Asia [3] - The company is supported by a workforce of over 12,000 dedicated and talented associates [3]

Core Viewpoint - Acuity Brands, Inc. is set to announce its third-quarter fiscal 2024 results, with expectations of stable earnings per share and slight revenue growth despite challenges in its Lighting segment [1][2][3]. Financial Performance - In the last reported quarter, Acuity Brands' adjusted earnings exceeded the Zacks Consensus Estimate by 8.7% and increased by 10.5% year over year, while revenue decreased by 4% from the prior year [1]. - The Zacks Consensus Estimate for the upcoming quarter's earnings per share is $4.20, reflecting a 12% increase from $3.75 reported in the same quarter last year [2]. - Revenue expectations for the upcoming quarter are pegged at $1.02 billion, indicating a 1.6% growth from the previous year's $1 billion [2]. Segment Analysis - The Acuity Brands Lighting (ABL) segment is anticipated to see a year-over-year revenue decline of 1.6% to $925.3 million due to tough comparisons from last year's excess backlog [3][4]. - Within the ABL segment, Independent Sales Network, Direct Sales Network, and Other revenues are expected to decline by 2.2%, 1.9%, and 1.3%, respectively, while Retail and Corporate Accounts sales are projected to grow by 3.2% and 1.4% [4]. - The Intelligent Spaces Group (ISG) segment is expected to see a revenue increase of 16.3% year over year to $76.5 million, driven by innovative lighting control solutions [4]. Margin Expectations - Increased prices and cost containment efforts are likely to positively impact margins, with adjusted operating margin expected to grow by 50 basis points year over year to 16.8% [4]. Earnings Prediction Model - The current model does not predict a definitive earnings beat for Acuity Brands, as the Earnings ESP stands at 0.00% and the company holds a Zacks Rank of 3 [5].

Core Insights - Acuity Brands (AYI) is projected to announce quarterly earnings of $4.20 per share, reflecting a 12% year-over-year increase, with revenues expected to reach $1.02 billion, a 1.6% increase from the same quarter last year [1] - The consensus EPS estimate has remained unchanged over the last 30 days, indicating analysts have reassessed their initial estimates [1] - Changes in earnings estimates are crucial for predicting investor reactions, with empirical studies showing a strong relationship between earnings estimate revisions and short-term stock price performance [1] Revenue Projections - The consensus estimate for Acuity Brands Lighting (ABL) revenues stands at $918.92 million, suggesting a year-over-year decline of 2.3% [2] - Revenues for the Intelligent Spaces Group (ISG) are projected to reach $76.42 million, indicating a year-over-year increase of 16.1% [2] Profit Estimates - Analysts expect the adjusted operating profit for the Intelligent Spaces Group to be approximately $14.25 million, up from $12.80 million reported in the same quarter last year [2] - The adjusted operating profit for Acuity Brands Lighting is anticipated to be $161.47 million, compared to $159.70 million in the same quarter last year [3] Stock Performance - Over the past month, Acuity Brands shares have recorded a return of -9.2%, contrasting with the Zacks S&P 500 composite's +2.7% change [3] - Based on its Zacks Rank 3 (Hold), Acuity Brands is expected to perform in line with the overall market in the upcoming period [3]

Group 1: Undervalued Stocks Overview - Undervalued stocks can drive significant portfolio returns despite being overlooked due to inherent flaws or fundamental issues [1] - The best undervalued stocks to buy include mixed-cap stocks that may emerge as top performers in the latter half of 2024 [1] Group 2: Rumble (RUM) - Rumble is building its ecosystem and has over 40 million monthly active users, indicating a sticky audience [2] - The company is expanding its advertising ecosystem and has secured exclusive deals with notable creators [2] - Rumble's pivot towards cloud services and data hosting is enhancing its market position [3] Group 3: BuzzFeed (BZFD) - BuzzFeed is facing challenges due to a history of scandals and declining sales, prompting activist investor Vivek Ramaswamy to acquire a 7.7% stake [5][6] - Ramaswamy is engaging with management to explore operational changes aimed at maximizing shareholder value [5] - The investment reflects a strategic move to improve media quality and transparency [6] Group 4: Upwork (UPWK) - Upwork has introduced new fees, which may signal a potential buyout bid despite recent profitability [7][8] - Historical rumors of a merger with Microsoft indicate Upwork's interest in strategic partnerships [8] - The introduction of fees could either harm client relations or serve as a tactic to boost valuation metrics [8] Group 5: Tilray Brands (TLRY) - Tilray's stock has decreased nearly 25% since January, yet it remains a strong contender in the cannabis sector [9] - The acquisition of brands from Anheuser-Busch has doubled Tilray's alcohol sales, diversifying its revenue streams [9][10] - Tilray is seeking $250 million for strategic acquisitions, presenting a buying opportunity for long-term investors [10] Group 6: Stem (STEM) - Stem operates at the intersection of sustainable energy and AI, with its software optimizing energy distribution [11] - The company is considered a penny stock but has potential for significant growth similar to past AI stocks [12] - Stem is progressing with completed projects, although it faces challenges in achieving profitability [12] Group 7: Tesla (TSLA) - Tesla remains underestimated despite significant corporate developments, including a shareholder vote on executive compensation [13][14] - The company continues to demonstrate long-term growth potential, supported by analysts' projections [13] - Overcoming governance challenges enhances Tesla's market confidence and solidifies its status as an investment opportunity [14] Group 8: Acuity Brands (AYI) - Acuity Brands is a leading lighting company with a strong track record of nearly 10% compounded annual growth in earnings [15] - The company has expanded through acquisitions and maintains a resilient market presence [15] - Acuity is positioned as a reliable long-term investment option due to its underestimated status [15]

Core Viewpoint - The article discusses three recommended brand stocks for long-term investment: Constellation Brands, Acuity Brands, and Kontoor Brands, highlighting their market performance and financial metrics [1]. Group 1: Constellation Brands (STZ) - Constellation Brands has a market capitalization of $48.08 billion and is known for its beer products, including Corona Extra and Modelo Especial [2]. - The company has diversified its portfolio to include seltzers, ready-to-drink products, wines, and spirits, and made a significant investment of $4 billion in Canopy Growth in 2018, which has since decreased in value to $190 million as of April 2024 [2][3]. - Analysts are optimistic about STZ stock, with 21 out of 26 rating it a "Buy" and a target price of $300, representing a 17% increase from a year ago [3]. Group 2: Acuity Brands (AYI) - Acuity Brands has shown significant recovery, with its stock up 52% in the past eight months after a two-year struggle [4]. - The company reported Q2 2024 revenues of $906 million, a 4% decline year-over-year, but an adjusted operating profit increase of 6% to $118 million and an 11% rise in adjusted earnings per share to $3.38 [4][5]. - Acuity's free cash flow reached $504.2 million, yielding 6.5%, which is considered fair value [5]. Group 3: Kontoor Brands (KTB) - Kontoor Brands has a market capitalization of $3.81 billion and has seen its shares rise over 10.6% year-to-date and 148% over the past five years [6]. - The company, known for its denim brands like Lee and Wrangler, offers a dividend yield of nearly 3%, significantly higher than the S&P 500 average of 1.3% [6]. - Kontoor's Q1 2024 results exceeded expectations, with a revenue forecast of $2.6 billion, flat year-over-year, and an EPS guidance increase to $4.75 [7].

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ATLANTA, May 30, 2024 (GLOBE NEWSWIRE) -- Acuity Brands, Inc. (NYSE:AYI) (the "Company") today announced that it is planning to release its fiscal 2024 third quarter results on Thursday, June 27, 2024, at 6:00 a.m. (EST), followed by a conference call at 8:00 a.m. (EST). Neil Ashe, Chairman, President, and Chief Executive Officer of Acuity Brands will lead the call. The webcast, earnings release, and supplemental presentation can be accessed via the Investor Relations section of the Company's website at www ...