AZZ(AZZ)2024-10-09 20:06Financial Performance - Total sales for Q2 FY2025 reached $409.0 million, an increase of 2.6% compared to the prior year[1] - Net income for the quarter was $35.4 million, up 25.0%, with adjusted net income at $41.3 million, up 11.0%[1] - Adjusted EBITDA for Q2 was $91.9 million, representing 22.5% of sales, compared to 22.1% in the prior year[1] - Precoat Metals segment sales increased to $237.5 million, up 3.8%, with an adjusted EBITDA margin of 21.1%[6] - Adjusted EBITDA for the three months ended August 31, 2024, was $106,004 thousand, up 7.1% from $98,885 thousand in the prior year[18] - Net income for the three months ended August 31, 2024, was $35,419 thousand, translating to an adjusted earnings per share of $1.18, compared to $28,332 thousand and $0.97 in the same period last year[27] - Adjusted EBITDA for the six months ended August 31, 2024, was $185,956 thousand, an increase from $173,374 thousand in the prior year[28] - For the three months ended August 31, 2023, net income totaled $28,332, with the Infrastructure Solutions segment reporting a loss of $4,958[32] - Adjusted EBITDA for the three months ended August 31, 2023, was $87,972, compared to $51,647 in the prior year[32] - The total net income for the six months ended August 31, 2023, was $56,854, with a Corporate segment loss of $106,823[33] Segment Performance - Metal Coatings segment sales were $171.5 million, up 1.0%, with an adjusted EBITDA margin of 31.7%[5] Debt and Leverage - The company reduced debt by $20.0 million in the quarter, totaling $45 million year-to-date, resulting in a net leverage ratio of 2.7x[1] - Long-term debt decreased to $912,572 thousand as of August 31, 2024, from $952,742 thousand as of February 29, 2024[19] - The company reported gross debt of $965,250 as of August 31, 2024, down from $1,010,250 in the previous period[35] - Consolidated indebtedness was $956,485, a decrease from $988,917[35] - The net leverage ratio improved to 2.7x from 2.9x in the previous period[35] Cash Flow and Investments - Cash provided by operating activities for the six months ended August 31, 2024, was $119,430 thousand, slightly up from $118,341 thousand in the same period last year[21] - The company reported a net cash used in investing activities of $(58,740) thousand for the six months ended August 31, 2024, compared to $(42,706) thousand in the same period last year[21] Capital Expenditures - Capital expenditures for Q2 amounted to $32.1 million, including $19.4 million for a new facility in Washington, Missouri[3] Guidance and Dividends - Revised FY2025 guidance estimates sales between $1.525 billion and $1.625 billion, with adjusted EBITDA of $320 million to $360 million[9] - Adjusted diluted EPS guidance for FY2025 is projected to be between $4.70 and $5.10[9] - The company declared a cash dividend of $0.17 per share to common shareholders[1] Asset Growth - Current assets increased to $401,156 thousand as of August 31, 2024, from $366,999 thousand as of February 29, 2024[19] - Total assets grew to $2,240,330 thousand as of August 31, 2024, compared to $2,195,505 thousand as of February 29, 2024[19] Transparency and Reporting - The company is focused on enhancing transparency through non-GAAP measures such as adjusted net income and adjusted EBITDA to provide a clearer picture of financial performance[23] Depreciation and Interest - Depreciation and amortization expenses for the six months ended August 31, 2024, totaled $40,750[31] - Interest expense for the six months ended August 31, 2024, was $44,683, consistent with the previous period[31]