Apogee Q4 Earnings Fall Short of Estimates, Shares Decline 12%

Core Viewpoint - Apogee Enterprises, Inc. reported disappointing fourth-quarter fiscal 2025 results, leading to a 12% decline in share price, with adjusted EPS missing estimates and a significant year-over-year decrease in earnings and revenues [1][11]. Financial Performance - Adjusted EPS for Q4 fiscal 2025 was 89 cents, below the Zacks Consensus Estimate of 90 cents, and down 21.9% year over year [1] - Including one-time items, EPS was 11 cents, a decrease from 71 cents in the same quarter last year [2] - Revenues for the quarter were $346 million, a 4.5% decline year over year, but exceeded the Zacks Consensus Estimate of $336 million [2] - Cost of sales decreased by 0.8% to $271 million, while gross profit fell 15.7% to $74.6 million, resulting in a gross margin drop to 21.6% from 24.4% [3] Segment Performance - Architectural Metals segment revenues decreased 19.4% year over year to $112 million, with an operating loss of $5.7 million [5] - Architectural Glass segment revenues fell 21.9% to $75 million, with operating profit dropping to approximately $11 million [5] - Architectural Services segment saw a 10.9% revenue increase to $118 million, with operating income rising to $8.6 million [6] - Performance Surfaces segment revenues surged 76.7% to $48 million, attributed to the UW Solutions acquisition, with operating profit slightly down to $6.1 million [7] Cash Position and Debt - Cash and cash equivalents at the end of fiscal 2025 were $41 million, up from $37 million at the end of fiscal 2024 [8] - Cash generated from operating activities was $125 million, down from $204 million the previous year [8] - Long-term debt increased significantly to $285 million from $62 million at the end of fiscal 2024 [9] Fiscal Year 2025 Overview - For fiscal 2025, Apogee reported a record adjusted EPS of $4.97, up from $4.77 in the prior year, meeting the Zacks Consensus Estimate [11] - Total revenues for the year decreased by 3.9% to $1.36 billion, surpassing the Zacks Consensus Estimate of $1.35 billion [11] Fiscal Year 2026 Guidance - The company anticipates net revenues of $1.37-$1.43 billion for fiscal 2026, with adjusted EPS expected to be $3.55-$4.10, factoring in tariff-related headwinds [12] - The UW Solutions business is projected to contribute $100 million to net revenues in fiscal 2026 [13] Stock Performance - Apogee's shares have declined 34.4% over the past year, compared to a 17.3% decline in the industry [14]