Valmont(US:VMI)2023-07-31 16:00Financial Performance - Consolidated net sales for the second quarter of fiscal 2023 were $2,108.8 million, a decrease of 7.9% compared to $2,116.4 million in the same period of fiscal 2022[103] - Gross profit increased to $329.4 million in the second quarter of fiscal 2023, representing a 12.6% increase from $292.6 million in the second quarter of fiscal 2022[103] - Operating income for the second quarter of fiscal 2023 was $133.7 million, up 12.6% from $118.7 million in the second quarter of fiscal 2022[103] - Net earnings attributable to Valmont Industries, Inc. increased by 17.4% to $89.4 million in the second quarter of fiscal 2023, compared to $76.1 million in the same period of fiscal 2022[103] - Net sales for the twenty-six weeks ended July 1, 2023, were $1.401 billion, slightly up from $1.396 billion for the same period in 2022[166] - Gross profit for the same period was $401.8 million, compared to $345.3 million in the prior year, indicating a significant improvement[166] - Operating income increased to $158.0 million for the twenty-six weeks ended July 1, 2023, from $142.1 million in the same period of 2022[166] Tax and Compliance - The effective tax rate for the second quarter of fiscal 2023 was 26.4%, down from 27.6% in the same period of fiscal 2022[123] - The company is in compliance with all covenants related to its debt agreements as of July 1, 2023[156] Sales and Segment Performance - Infrastructure segment total sales for the second quarter of fiscal 2023 were $770.6 million, an increase of 4.2% compared to $739.5 million in the same period of fiscal 2022[127] - Solar sales in the second quarter of fiscal 2023 increased by 82.1% to $51.3 million, up from $28.2 million in the same period of fiscal 2022[127] - Agriculture segment total sales decreased by 25.9% to $279.9 million in the second quarter of fiscal 2023, down from $377.8 million in the same period of fiscal 2022[134] - North America sales in the Agriculture segment decreased by 30.7% to $140.9 million in the second quarter of fiscal 2023, compared to $203.5 million in the same period of fiscal 2022[134] Expenses and Cash Flow - Selling, general, and administrative expenses increased to $195.7 million in the second quarter of fiscal 2023, a 12.5% increase from $173.9 million in the same period of fiscal 2022[103] - SG&A expenses increased in the second quarter of fiscal 2023 due to higher employment costs and incremental expenses from the acquisition of ConcealFab, totaling $2.2 million[133] - Cash flows from operating activities were $109.5 million in the first half of fiscal 2023, compared to $68.0 million in the first half of fiscal 2022[126] - The company reported net cash flows provided by operating activities of $109.5 million for the first half of fiscal 2023, an increase from $68.0 million in the same period of fiscal 2022[161] Debt and Capital Management - As of July 1, 2023, the company had outstanding borrowings of $222.7 million under its revolving credit facility, up from $140.5 million as of December 31, 2022[149] - The company plans to maintain a debt to invested capital ratio that supports its current investment grade debt rating[140] - Total interest-bearing debt increased to $955.4 million as of July 1, 2023, up from $878.0 million as of December 31, 2022[163] - Adjusted EBITDA for the last four fiscal quarters was $622.4 million, with a leverage ratio of 1.39 as of July 1, 2023, well below the covenant limit of 3.50[171][173] Acquisitions and Divestitures - The company entered into an agreement to acquire HR Products for approximately $40 million USD, expected to close in the third quarter of fiscal 2023[108] - The company divested Torrent Engineering and Equipment in the second quarter of fiscal 2023, impacting the Agriculture segment[109] Currency Effects and Liabilities - The company experienced unfavorable currency translation effects of $8.4 million and $19.2 million for the second quarter and first half of fiscal 2023, respectively[127] - The company has a liability for foreign withholding taxes and U.S. state income taxes totaling $3.0 million as of July 1, 2023[159] Dividend - The company authorized an increase in the quarterly cash dividend to $0.60 per share, a 9% increase from the previous dividend of $0.55 per share[142]