CHATTANOOGA, Tenn., April 25, 2017 (GLOBE NEWSWIRE) -- Astec Industries, Inc. (Nasdaq:ASTE) today reported results for their first quarter ended March 31, 2017.
Net sales for the first quarter of 2017 were $318.4 million compared to $278.7 million for the first quarter of 2016, a 14% increase. Earnings for the first quarter of 2017 were $15.1 million or $0.65 per diluted share compared to $17.7 million or $0.77 per diluted share in the first quarter of 2016, a decrease in earnings per share of 16%.
Domestic sales increased 8% to $253.5 million for the first quarter of 2017 from $234.2 million for the first quarter of 2016. International sales increased 46% to $64.9 million for the first quarter of 2017 from $44.5 million for the first quarter of 2016.
The Company’s backlog at March 31, 2017 was $361.8 million. Domestic backlog decreased 25% to $290.4 million at March 31, 2017 from $387.9 million at March 31, 2016. The international backlog at March 31, 2017 was $71.3 million compared to $50.8 million at March 31, 2016, an increase of 40%. Total March 31, 2017 backlog decreased $76.9 million or 18% compared to March 31, 2016. Excluding all pellet plant backlogs, the Company’s March 31, 2017 backlog increased $35.2 million or 14% compared to March 31, 2016. All prior year backlog amounts have been recast to include the backlog of Power Flame Incorporated which was acquired on August 1, 2016.
Consolidated financial information for the first quarter ended March 31, 2017 and additional information related to segment revenues and profits are attached as addenda to this press release.
Commenting on the announcement of the quarterly results, Benjamin G. Brock, Chief Executive Officer, stated: “We are pleased with our results for the first quarter. We were able to grow revenues and, as expected, our gross margins were lower than usual, mainly due to new products being manufactured in many of our facilities. Our new products normally carry lower margins early on in their product life cycle. Our ConExpo show expense of $4.3M also affected our net income but resulted in the best ConExpo I have ever attended. While our year-over-year backlog is down including pellet plant orders, we were able to grow our March 31, 2017 backlog 14% excluding all pellet plant orders.”
Mr. Brock continued, “The domestic market remained strong for our Infrastructure Group’s products targeted at the road construction industry. Our Aggregate and Mining Group continued to see improvement in the domestic market for products targeted at traditional rock quarries. The market for our equipment continues to be slow on the mining side. Our Energy Group product sales for the infrastructure industry were strong while specialized industrial markets remained steady during the quarter. We continue to experience a slight increase in quote and order activity in the oil and gas markets.”
Mr. Brock concluded, “We remain optimistic about 2017. Our backlog at March 31, 2017 was historically very good at $361.8 million. Still, some of these orders are for new equipment designs that have the potential to carry lower margin and/or higher than normal warranty expense in the first half of this year. However, the introduction of new products is essential for our future. While the increase in order activity is a good sign for the year ahead and we have been able to secure international orders in the face of significant headwinds from the strong U.S. Dollar, we still face challenges on U.S. exports given the continued strength of the U.S. dollar and in products targeted at the cautious mining industry.”
Investor Conference Call and Web Simulcast
Astec will conduct a conference call on April 25, 2017, at 10:00 A.M. Eastern Time to review its first quarter results as well as current business conditions. The number to call for this interactive teleconference is (877) 407-9210. International callers should dial (201) 689-8049. Please reference Astec Industries.
The Company will also provide an online Web simulcast and rebroadcast of the conference call. The live broadcast of Astec’s conference call will be available online at the Company’s website: www.astecindustries.com/conferencecalls. An archived webcast will be available for 90 days at www.astecindustries.com.
A replay of the conference call will be available through midnight on Tuesday, May 9, 2017 by dialing (877) 481-4010, or (919) 882-2331 for international callers, Replay ID# 10344. A transcription of the conference call will be made available under the Investor Relations section of the Astec Industries, Inc. website within 5 business days after the call.
Astec Industries, Inc. is a manufacturer of specialized equipment for asphalt road building; aggregate processing; oil, gas and water well drilling; and wood processing. Astec’s manufacturing operations are divided into three primary business segments: road building and related equipment (Infrastructure Group); aggregate processing and mining equipment (Aggregate and Mining Group); and equipment for the extraction, production and combustion of fuels, biomass production, and water drilling equipment (Energy Group).
The information contained in this press release contains “forward-looking statements” (within the meaning of the Private Securities Litigation Reform Act of 1995) regarding the future performance of the Company, including statements about the effects on the Company from introduction of new products, higher warranty costs, the ConExpo show, the global mining slow down and the strong U.S. Dollar. These forward-looking statements reflect management’s expectations and are based upon currently available information, and the Company undertakes no obligation to update or revise such statements. These statements are not guarantees of performance and are inherently subject to risks and uncertainties, many of which cannot be predicted or anticipated. Future events and actual results, financial or otherwise, could differ materially from those expressed in or implied by the forward-looking statements. Important factors that could cause future events or actual results to differ materially include: general uncertainty in the economy, oil and liquid asphalt prices, rising steel prices, decreased funding for highway projects, the relative strength/weakness of the dollar to foreign currencies, production capacity, general business conditions in the industry, demand for the Company’s products, seasonality and cyclicality in operating results, seasonality of sales volumes or lower than expected sales volumes, lower than expected margins on custom equipment orders, competitive activity, tax rates and the impact of future legislation thereon, and those other factors listed from time to time in the Company’s reports filed with the Securities and Exchange Commission, including but not limited to the Company’s annual report on Form 10-K for the year ended December 31, 2016.
| Astec Industries, Inc. | ||||
| Consolidated Balance Sheets | ||||
| (in thousands) | ||||
| (unaudited) | ||||
| Mar 31 | Mar 31 | |||
| 2017 | 2016 | |||
| Assets | ||||
| Current assets | ||||
| Cash and cash equivalents | $ | 55,401 | $ | 62,445 |
| Investments | 1,408 | 1,654 | ||
| Receivables, net | 156,222 | 119,371 | ||
| Inventories | 372,570 | 389,504 | ||
| Prepaid expenses and other | 20,731 | 26,961 | ||
| Total current assets | 606,332 | 599,935 | ||
| Property and equipment, net | 182,223 | 171,205 | ||
| Other assets | 85,933 | 64,640 | ||
| Total assets | $ | 874,488 | $ | 835,780 |
| Liabilities and equity | ||||
| Current liabilities | ||||
| Accounts payable - trade | $ | 73,807 | $ | 56,188 |
| Other current liabilities | 110,828 | 126,453 | ||
| Total current liabilities | 184,635 | 182,641 | ||
| Non-current liabilities | 25,503 | 26,877 | ||
| Total equity | 664,350 | 626,262 | ||
| Total liabilities and equity | $ | 874,488 | $ | 835,780 |
| Astec Industries, Inc. | ||||
| Consolidated Statements of Income | ||||
| (in thousands, except per share data) | ||||
| (unaudited) | ||||
| Three Months Ended | ||||
| Mar 31 | ||||
| 2017 | 2016 | |||
| Net sales | $ | 318,401 | $ | 278,721 |
| Cost of sales | 242,630 | 206,765 | ||
| Gross profit | 75,771 | 71,956 | ||
| Selling, general, administrative & engineering expenses | 53,121 | 43,806 | ||
| Income from operations | 22,650 | 28,150 | ||
| Interest expense | 265 | 467 | ||
| Other | 552 | 609 | ||
| Income before income taxes | 22,937 | 28,292 | ||
| Income taxes | 7,817 | 10,549 | ||
| Net income attributable to controlling interest | $ | 15,120 | $ | 17,743 |
| Earnings per Common Share | ||||
| Net income attributable to controlling interest | ||||
| Basic | $ | 0.66 | $ | 0.77 |
| Diluted | $ | 0.65 | $ | 0.77 |
| Weighted average common shares outstanding | ||||
| Basic | 23,013 | 22,965 | ||
| Diluted | 23,176 | 23,135 | ||
| Astec Industries, Inc. | ||||||||||||||
| Segment Revenues and Profits | ||||||||||||||
| For the three months ended March 31, 2017 and 2016 | ||||||||||||||
| (in thousands) | ||||||||||||||
| (unaudited) | ||||||||||||||
| Infrastructure Group | Aggregate and Mining Group | Energy Group | Corporate Group | Total | ||||||||||
| 2017 Revenues | 165,243 | 100,613 | 52,545 | - | 318,401 | |||||||||
| 2016 Revenues | 153,114 | 92,488 | 33,119 | - | 278,721 | |||||||||
| Change $ | 12,129 | 8,125 | 19,426 | - | 39,680 | |||||||||
| Change % | 7.9 | % | 8.8 | % | 58.7 | % | - | 14.2 | % | |||||
| 2017 Gross Profit | 37,801 | 25,023 | 12,887 | 60 | 75,771 | |||||||||
| 2017 Gross Profit % | 22.9 | % | 24.9 | % | 24.5 | % | - | 23.8 | % | |||||
| 2016 Gross Profit | 39,837 | 25,148 | 7,082 | (111 | ) | 71,956 | ||||||||
| 2016 Gross Profit % | 26.0 | % | 27.2 | % | 21.4 | % | - | 25.8 | % | |||||
| Change | (2,036 | ) | (125 | ) | 5,805 | 171 | 3,815 | |||||||
| 2017 Profit (Loss) | 18,180 | 8,428 | 2,729 | (14,428 | ) | 14,909 | ||||||||
| 2016 Profit (Loss) | 21,863 | 9,538 | (192 | ) | (14,226 | ) | 16,983 | |||||||
| Change $ | (3,683 | ) | (1,110 | ) | 2,921 | (202 | ) | (2,074 | ) | |||||
| Change % | (16.8 | %) | (11.6 | %) | 1521.4 | % | (1.4 | %) | (12.2 | %) | ||||
| Segment revenues are reported net of intersegment revenues. Segment gross profit is net of profit on intersegment | ||||||||||||||
| revenues. A reconciliation of total segment profits to the Company's net income attributable to controlling interest is as follows (in thousands): | ||||||||||||||
| Three months ended March 31 | ||||||||||||||
| 2017 | 2016 | Change $ | ||||||||||||
| Total profit for all segments | $ | 14,909 | $ | 16,983 | $ | (2,074 | ) | |||||||
| Recapture of intersegment profit | 172 | 695 | (523 | ) | ||||||||||
| Net loss attributable to non-controlling interest | 39 | 65 | (26 | ) | ||||||||||
| Net income attributable to controlling interest | $ | 15,120 | $ | 17,743 | $ | (2,623 | ) | |||||||
| Astec Industries, Inc. | ||||||||||||||
| Backlog by Segment | ||||||||||||||
| March 31, 2017 and 2016 | ||||||||||||||
| (in thousands) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Infrastructure Group | Aggregate and Mining Group | Energy Group | Total | |||||||||||
| 2017 Backlog | 221,849 | 100,043 | 39,875 | 361,767 | ||||||||||
| 2016 Backlog | 326,039 | 79,128 | 33,523 | 438,690 | ||||||||||
| Change $ | (104,190 | ) | 20,915 | 6,352 | (76,923 | ) | ||||||||
| Change % | (32.0 | %) | 26.4 | % | 18.9 | % | (17.5 | %) | ||||||