Apogee Swings To 3Q Profit On Increased Prices, Volumes

Date : 12/14/2011 @ 7:34PM
Source : Dow Jones News
Stock : Honeywell International Inc. (HON)
Quote : 132.14  0.29 (0.22%) @ 4:03PM

Apogee Swings To 3Q Profit On Increased Prices, Volumes

Apogee Enterprises, Inc. (MM) (NASDAQ:APOG)
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Industrial-glass maker Apogee Enterprises Inc. (APOG) swung to a stronger-than-expected profit in its fiscal third quarter, breaking a six-quarter string of losses, as its main architectural glass segment benefited from higher prices and volume.

The company also raised its full-year guidance for the 2012 fiscal year by calling for 14% revenue growth and sharpened its earnings outlook to 7 cents a share for the year. The company in September forecast top-line growth of more than 10% and simply said it would make a profit.

Apogee had swung to the red in every quarter of the previous fiscal year as an anemic construction sector hurt its sales. During the recession, the company cut jobs and spending to match lower demand, but a full-scale building recovery has yet to arrive this year.

Chief Executive Joseph F. Puishys said some of the company's stronger performance in the latest quarter owed to operational improvements, as well as a steady backlog in the architectural business.

"We achieved excellent top-line growth in both segments, given current market conditions," he said.

Puishys became CEO in August as the successor to Russell Huffer, who stepped down as chairman in January and stayed on as chief executive until the company found a replacement. Puishys has participated in manufacturing businesses for 32 years, coming to Apogee from Honeywell International Inc.'s (HON) Environmental and Combustion Controls division, where he was president.

For the quarter ended Nov. 26, Apogee Enterprises reported a profit of $5.5 million, or 20 cents a share, compared with a year-earlier loss of $2.3 million, or 8 cents a share. Revenue grew 19% to $174.9 million.

Analysts polled by Thomson Reuters expected a 12-cent profit and $171 million of revenue.

Gross margin widened to 19.9% from 15.7% on higher pricing and volume in the architectural glass business.

Sales jumped 21% in Apogee's architectural segment, which provides the lion's share of total revenue, helping it swing to a slight operating profit. Sales grew 6.1% in the large-scale optical technologies segment, which posted breakeven earnings.

Backlog in the architectural segment reached $230.7 million, compared with $231.3 million in the second quarter and $165.7 million a year ago.

Shares closed at $10.56 Wednesday, down a penny, and were inactive after hours. The stock is off 22% this year.

-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; Andrew.FitzGerald@dowjones.com

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