Astec Industries(US:ASTE)2022-02-28 21:17Strategic Transformation and Business Model - The company has initiated a strategic transformation focused on implementing new business strategies and a new operating structure under the OneASTEC business model, emphasizing Simplify, Focus, and Grow[20]. - The company has launched a multi-year phased implementation of a standardized ERP system to improve operational efficiency and integrate technology solutions across its global organization[24]. - The company has implemented a new Performance Management model to align efforts with company goals and targets, focusing on values and professional development[88]. Acquisitions and Market Expansion - Since the inception of the growth initiatives, the company has completed three acquisitions to enhance its market presence and product offerings[27]. - The Company completed the acquisition of CON-E-CO for $13.8 million, recognizing $4.3 million in intangible assets, enhancing its concrete batch plant manufacturing capabilities[327]. - The acquisition of BMH Systems for $15.6 million resulted in $6.3 million of goodwill and $5.7 million of other intangible assets, further strengthening the Infrastructure Solutions segment[329]. Product and Technology Development - The Infrastructure Solutions segment designs and manufactures a complete line of asphalt plants and concrete plants, with a focus on enhancing production efficiency and environmental compliance[31]. - The new Versa Jet burner platform allows for retrofit applications with minimal modifications, enhancing the adaptability of asphalt mixing plants[35]. - The patented water injection warm mix asphalt system enables lower temperature asphalt mixing, significantly reducing emissions during paving[36]. - The Vantage 140 portable asphalt plant, designed for international markets, has a production capacity of 140 metric tons per hour and RAP mixing capabilities of 50%[38]. - The Shuttle Buggy mobile material transfer vehicle allows continuous paving, improving road surface smoothness and reducing the number of haul trucks required[39]. Financial Performance - The company reported net sales of $1,097.2 million for the year ended December 31, 2021, an increase of 7.1% compared to $1,024.4 million in 2020[246]. - Gross profit for the year was $251.7 million, representing a gross margin of approximately 22.9%, up from $240.1 million in 2020[246]. - Net income attributable to controlling interest was $17.8 million for 2021, a decrease of 62.0% from $46.9 million in 2020[246]. - Earnings per common share (basic and diluted) were both $0.78 for 2021, down from $2.08 in 2020[246]. - Total assets increased to $911.3 million in 2021, up from $848.2 million in 2020, reflecting a growth of 7.4%[244]. Backlog and Orders - The backlog for the Infrastructure Solutions segment was approximately $449.3 million as of December 31, 2021, compared to $218.2 million in 2020, indicating a 106.5% increase[50]. - The backlog for the Materials Solutions Group was approximately $313.3 million at December 31, 2021, up from $142.3 million in 2020, representing a 120% increase[65]. - As of December 31, 2021, the company had a backlog of approximately $762.6 million, up from $360.5 million in 2020, with $346.4 million of the increase attributed to domestic customer orders[76]. Supply Chain and Operational Efficiency - The company is focused on optimizing its supply chain to improve lead times and lower logistics costs through global operations consolidation[22]. - The company has experienced supply chain challenges due to the ongoing impact of the COVID-19 pandemic, affecting the availability of certain customized components[69]. - The company has consolidated four sites and is in the process of consolidating its Tacoma site, expected to be completed in early 2022[23]. Employee and Safety Metrics - The company employed 4,041 individuals as of December 31, 2021, with 2,646 engaged in manufacturing and 1,002 in selling, administrative, and management functions[81]. - The company experienced a 23% increase in recordable injuries across all sites in 2021 compared to the previous year, with an OSHA Incident Rate rising from 1.39 in 2020 to 1.71 in 2021[85]. - The company aims to reduce lost time and recordable injuries each year, with zero recordable injuries reported at five sites in 2021[85]. Research and Development - The company invested $26.5 million in research and development expenses in 2021, up from $22.1 million in 2020, indicating a focus on innovation[246]. Inventory and Assets - The company recorded inventories of $303.0 million as of December 31, 2021, an increase of 21.4% from $249.7 million in 2020[244]. - The Company recorded a total inventory of $303.0 million as of December 31, 2021, an increase from $249.7 million in 2020, with raw materials and parts rising to $216.1 million[334]. Financial Liabilities and Equity - Total liabilities rose to $256.5 million in 2021, compared to $205.2 million in 2020, marking an increase of 25.0%[244]. - The company’s total equity increased to $654.8 million in 2021, compared to $643.0 million in 2020, reflecting a growth of 1.4%[244]. Foreign Operations and Currency - Foreign operations represented 18.9% of total assets and 14.7% of total net sales for the year ended December 31, 2021[224]. - Foreign currency transaction losses amounted to $1.3 million in 2021, compared to a gain of $1.1 million in 2020[315]. Corporate Governance and Diversity - The company’s Board of Directors currently comprises 20% women, reflecting its commitment to diversity and inclusion[89].