Apogee(US:APOG)2025-04-24 01:51Financial Performance - Fourth-quarter net sales decreased 4.5% to $345.7 million, impacted by an extra week of operations in the prior year which negatively affected sales by 7.9%[9] - Full-year net sales totaled $1.36 billion, with a decline of 3.9% compared to the previous year, also affected by an extra week of operations[9] - Fourth-quarter diluted EPS was $0.11, down 84.5% from $0.71 in the prior year, while adjusted diluted EPS decreased to $0.89 from $1.14[9] - Full-year adjusted diluted EPS grew 4% to a record $4.97, compared to $4.79 in the previous year[3] - Operating income for the fourth quarter was $6.1 million, with an operating margin of 1.8%, down from 6.0% in the prior year[9] - Adjusted operating income for the fourth quarter was $28.7 million, with an adjusted operating margin of 8.3%, a decrease of 120 basis points from the previous year[9] - The company reported a net earnings decline of 84.2% for the three months ended March 1, 2025, totaling $2.5 million[30] - Net earnings for the three months ended March 1, 2025, were $2,485,000, a decrease from $15,736,000 for the same period last year[41] - Net earnings for the twelve months ended March 1, 2025, were $85,052,000, a decrease from $99,613,000 in the prior year, representing a decline of about 14.7%[53] Segment Performance - The Architectural Metals segment saw a 19.4% decline in net sales to $112.1 million, while the Performance Surfaces segment experienced a 76.7% increase to $47.9 million[10][13] - Architectural Metals segment net sales fell by 19.4% to $112.148 million, while Architectural Services increased by 10.9% to $117.895 million[32] - The Architectural Glass segment experienced a decline in net sales by 21.9% to $75.157 million for the three months ended March 1, 2025[32] - The Performance Surfaces segment saw a significant increase in net sales by 76.7% to $47.899 million for the three months ended March 1, 2025[32] Cash Flow and Shareholder Returns - Net cash provided by operating activities in the fourth quarter was $30.0 million, down from $74.9 million in the prior year[15] - The company returned $67.1 million to shareholders through share repurchases and dividends, up from $33.0 million in the prior year[16] - The company reported a net cash provided by operating activities of $125.162 million for the twelve months ended March 1, 2025, down from $204.154 million[39] - Cash dividends per common share increased by 4.0% to $0.26 for the three months ended March 1, 2025[30] Debt and Leverage - Long-term debt increased to $285.0 million, resulting in a Consolidated Leverage Ratio of 1.3x at the end of the quarter[18] - Long-term debt increased significantly to $285 million from $62 million, indicating a rise of 359.7%[37] Future Outlook - The Company expects net sales for fiscal 2026 to be in the range of $1.37 billion to $1.43 billion, with diluted EPS projected between $2.54 and $3.19[21] - Adjusted diluted EPS is expected to range from $3.55 to $4.10, including an unfavorable impact from tariffs of $0.45 to $0.55[21] - Future outlook includes continued focus on integration of the UW Solutions acquisition and potential market expansion strategies[42] Project Fortify - The initial phase of Project Fortify incurred pre-tax charges of $16.7 million, with estimated annualized cost savings of approximately $14 million[19] - The second phase of Project Fortify is expected to incur pre-tax charges of $24 million to $26 million, delivering estimated annualized pre-tax cost savings of $13 million to $15 million[19] - Restructuring charges related to Project Fortify totaled $4,323,000 for the twelve months ended March 1, 2025, down from $12,403,000 in the previous year, reflecting a decrease of approximately 65.2%[59] Acquisition Impact - The acquisition of UW Solutions contributed $23.2 million, or 6.4%, to fourth-quarter net sales and $32.0 million, or 2.3%, to full-year net sales[9] - The UW Solutions business, acquired in November 2024, is expected to contribute approximately $100 million in net sales with an adjusted EBITDA margin of around 20%[21] - Total acquisition-related costs for the three months ended March 1, 2025, amounted to $4,429,000, with integration costs contributing $1,114,000[41] - The total acquisition-related costs amounted to $10,302,000 for the twelve months ended March 1, 2025, compared to no costs reported in the previous year[59] Earnings Adjustments - Adjusted net earnings for the twelve months ended March 1, 2025, were $108,872,000, compared to $105,439,000 for the previous year, reflecting a 2.3% increase[41] - Adjusted operating income for the same period was $149,762,000, compared to $146,236,000 in the prior year, indicating a slight increase of about 1.7%[49] - Adjusted Return on Invested Capital (ROIC) for the twelve months ended March 1, 2025, was 14.9%, down from 16.8% in the previous year[59] - The EBITDA margin for the twelve months ended March 1, 2025, was 12.0%, compared to 12.5% for the previous year, indicating a slight contraction[53] - The operating margin for the twelve months ended March 1, 2025, was 8.7%, compared to 9.4% in the previous year, indicating a decrease of about 7.4%[49] Impairment and Restructuring - The company incurred impairment expenses of $7,634,000 related to intangible assets in the Architectural Metals Segment for the twelve months ended March 1, 2025[50] - Impairment expense for the three months ended March 1, 2025, was $7,634,000, reflecting ongoing challenges in the Architectural Metals Segment[41] - Restructuring charges for the three months ended March 1, 2025, were $1,110,000, compared to $12,403,000 for the same period last year[41] Share Count - The company reported a weighted average diluted shares outstanding of 21,793,000 for the three months ended March 1, 2025[41]