APOG Apogee Enterprises Inc

• Net sales of $354 million and diluted EPS of $1.52
• Operating margin reaches 11.5%, up from 8.6% in last year’s second quarter
• Adjusted diluted EPS grows 28% to an all-time quarterly record $1.36
• Year-to-date cash flow from operations of $63 million, an improvement of $65 million compared to the same period of last year
• Increasing full-year adjusted diluted EPS outlook to a range of $4.35 to $4.65

Apogee Enterprises, Inc. (Nasdaq: APOG) today reported its fiscal 2024 second-quarter results. The Company reported the following selected financial results:

 

 

Three Months Ended

 

 

($ in thousands, except per share amounts)

 

August 26, 2023

 

August 27, 2022

 

% Change

Net Sales

 

$

353,675

 

 

$

372,109

 

 

(5.0

)%

Operating income

 

$

40,553

 

 

$

32,072

 

 

26.4

%

Operating margin %

 

 

11.5

%

 

 

8.6

%

 

33.7

%

Diluted earnings per share

 

$

1.52

 

 

$

1.68

 

 

(9.5

)%

Additional Non-GAAP Measures1

 

 

 

 

 

 

Adjusted diluted earnings per share

 

$

1.36

 

 

$

1.06

 

 

28.3

%

Adjusted EBITDA

 

 

51,145

 

 

 

42,498

 

 

20.3

%

“We delivered another quarter of strong margin expansion and adjusted earnings growth,” said Ty R. Silberhorn, Chief Executive Officer. “Second quarter operating margin of 11.5% exceeded our 10% target for the first time since we established our financial goals in November 2021. I’d like to recognize the entire Apogee team for the tremendous progress we’ve achieved during this time.”

Mr. Silberhorn concluded, “Our improved profitability is being driven by continued execution of our strategy. We’ve made sustainable improvements to our cost structure, realized meaningful productivity gains through the deployment of the Apogee Management System, and made great progress in shifting our sales mix toward more differentiated offerings. We see significant opportunities to build on this success as we move forward.”

Consolidated Results (Second Quarter Fiscal 2024 Compared to Second Quarter Fiscal 2023)

• Net sales were $353.7 million compared to $372.1 million, primarily reflecting lower volumes in Architectural Services and Architectural Framing Systems, partially offset by strong growth in Architectural Glass.
• Gross profit increased $10.4 million, or 12.3%, and gross margin increased to 27.0% compared to 22.8%. The improvement in gross margin was primarily driven by higher gross margins in both Architectural Framing Systems and Architectural Glass and the increased mix of Architectural Glass in the consolidated results. This was partially offset by lower margins in the Large-Scale Optical segment.
• Selling, general and administrative expenses increased $2.0 million to 15.5% of net sales compared to 14.2%. The increase was primarily due to increased compensation related expenses and higher consulting costs.
• Operating income grew 26.4% to $40.6 million, and operating margin increased 290 basis points to 11.5%, primarily driven by improved operating margin in Architectural Glass as well as the Architectural Glass segment comprising a higher mix of the consolidated results.
• Net interest expense was $2.2 million, compared to $1.7 million, reflecting a higher average interest rate, partially offset by a lower average debt level.
• Other income included a $4.7 million pre-tax gain related to a New Markets Tax Credit.
• Income tax expense was $9.9 million, compared to a tax benefit of $7.2 million in last year’s second quarter, which included a $13.7 million tax deduction for worthless stock and other related discrete tax benefits.
• Diluted earnings per share (“EPS”) were $1.52 compared to $1.68.
• Adjusted diluted EPS grew 28% to a record $1.36.

Segment Results (Second Quarter Fiscal 2024 Compared to Second Quarter Fiscal 2023)

Architectural Framing Systems

Architectural Framing Systems net sales were $158.8 million, compared to $172.9 million, primarily reflecting lower volume, partially offset by a more favorable sales mix. Operating income increased to $21.1 million, or 13.3% of net sales, compared to $20.5 million, or 11.9% of net sales. The operating margin improvement was primarily driven by improved sales mix and cost efficiencies, partially offset by the impact of lower volume. Segment backlog2 at the end of the quarter was $197 million, compared to $221 million at the end of the first quarter.

Architectural Glass

Architectural Glass net sales grew 21.6%, to $94.1 million, primarily driven by improved pricing and mix, reflecting the strategic shift to emphasize premium, high-performance products, as well as higher volume. Operating income increased to $17.4 million, or 18.5% of net sales, compared to $6.5 million, or 8.3% of net sales. The operating margin improvement was primarily driven by the impact of higher volume and improved pricing and mix, partially offset by cost inflation.

Architectural Services

Architectural Services net sales were $88.1 million, compared to $106.7 million, primarily reflecting lower project volume due to a higher mix of projects in earlier stages of completion. Operating income was $3.5 million, or 4.0% of net sales, compared to $5.5 million, or 5.1% of net sales. The change in operating margin was primarily driven by lower project volume. Segment backlog ended the quarter at $674 million, compared to $709 million at the end of the first quarter.

Large-Scale Optical

Large-Scale Optical net sales were $23.6 million, compared to $25.2 million, primarily reflecting lower volume driven by customer inventory destocking, partially offset by a more favorable mix. Operating income was $4.7 million, or 19.7% of net sales, compared to $6.0 million, or 23.8% of net sales. The change in operating margin was primarily driven by the impact of lower volume, partially offset by improved price and mix.

Corporate and Other

Corporate and other expense was $6.1 million, compared to $6.4 million.

Financial Condition

Net cash provided by operating activities in the quarter was $41.3 million, compared to $27.8 million in last year’s second quarter. Fiscal year to date, net cash provided by operating activities was $62.6 million, compared to a use of cash from operations of $2.6 million in the prior-year period. The improved cash flow was primarily driven by lower working capital compared to the prior year. Capital expenditures through the first half of the fiscal year were $15.0 million, compared to $9.3 million last year, as the Company increased investments in projects to support its strategy.

During the quarter, the Company executed share repurchases for $6.6 million and made dividend payments of $5.2 million. Fiscal year to date, the Company has returned $22.3 million of cash to shareholders through share repurchases and dividend payments.

Quarter-end total long-term debt was $145.7 million, compared to $169.8 million at the end of fiscal 2023. The net leverage ratio3 as of the end of the second quarter was 0.7x compared to 0.9x at the end of fiscal 2023.

Updated Outlook

The Company most recently provided an outlook for full-year GAAP diluted EPS in the range of $4.15 to $4.45. The Company is now providing an updated outlook for full-year adjusted diluted EPS in the range of $4.35 to $4.654. As a reminder, fiscal 2024 is a 53-week year, with an extra week in the fourth quarter. Including the extra week of operations, the Company continues to expect flat to slightly declining net sales compared to fiscal 2023. The Company continues to expect a long-term average tax rate of approximately 24.5% and capital expenditures in fiscal 2024 between $50 to $60 million.

Conference Call Information

The Company will host a conference call today at 8:00 a.m. Central Time to discuss its financial results and provide a business update. This call will be webcast and is available in the Investor Relations section of the company’s website, along with presentation slides, at https://www.apog.com/events-and-presentations. The webcast will also be archived for replay on the company’s website for one year from the date of the conference call.

About Apogee Enterprises

Apogee Enterprises, Inc. (Nasdaq: APOG) is a leading provider of architectural products and services for enclosing buildings, and high-performance glass and acrylic products used for preservation, energy conservation, and enhanced viewing. Headquartered in Minneapolis, MN, our portfolio of industry-leading products and services includes high-performance architectural glass, windows, curtainwall, storefront and entrance systems, integrated project management and installation services, as well as value-added glass and acrylic for custom picture framing and displays. For more information, visit www.apog.com.

Use of Non-GAAP Financial Measures

Management uses non-GAAP measures to evaluate the Company’s historical and prospective financial performance, measure operational profitability on a consistent basis, and provide enhanced transparency to the investment community. Non-GAAP measures should be viewed in addition to, and not as a substitute for, the reported financial results of the Company prepared in accordance with GAAP. Other companies may calculate these measures differently, limiting the usefulness of the measures for comparison with other companies. This release and other financial communications may contain the following non-GAAP measures:

• Adjusted operating income, adjusted operating margin, adjusted net earnings, and adjusted diluted earnings per share (or “adjusted diluted EPS”) are used by the Company to provide meaningful supplemental information about its operating performance by excluding amounts that are not considered part of core operating results to enhance comparability of results from period to period.
• Adjusted EBITDA represents adjusted net earnings before interest, taxes, depreciation, and amortization. The Company believes this metric provides useful information to investors and analysts about the Company's core operating performance.
• Free cash flow is defined as net cash provided by operating activities, minus capital expenditures. The Company considers this measure an indication of its financial strength. However, free cash flow does not fully reflect the Company’s ability to freely deploy generated cash, as it does not reflect, for example, required payments on indebtedness and other fixed obligations.
• Net debt is a non-GAAP measure defined as total debt (current debt plus long-term debt) on our consolidated balance sheet, less cash and cash equivalents. The Company considers this measure helpful to evaluate our capital structure and financial leverage, and our ability to fund investing and financing activities.
• Net leverage ratio is a non-GAAP ratio defined as net debt divided by trailing twelve months adjusted EBITDA. The Company considers this measure helpful to evaluate our capital structure and financial leverage, and our ability to fund investing and financing activities.

Backlog is an operating measure used by management to assess future potential sales revenue. Backlog is defined as the dollar amount of signed contracts or firm orders, generally as a result of a competitive bidding process, which is expected to be recognized as revenue. Backlog is not a term defined under U.S. GAAP and is not a measure of contract profitability. Backlog should not be used as the sole indicator of future revenue because the Company has a substantial number of projects with short lead times that book-and-bill within the same reporting period that are not included in backlog.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “forecast,” “project,” “should” and similar expressions are intended to identify “forward-looking statements”. These statements reflect Apogee management’s expectations or beliefs as of the date of this release. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. All forward-looking statements are qualified by factors that may affect the results, performance, financial condition, prospects and opportunities of the Company , including the following: (A) U.S. and global economic conditions, including the cyclical nature of the North American and Latin American commercial construction industries and the potential impact of an economic downturn or recession; (B) fluctuations in foreign currency exchange rates; (C) actions of new and existing competitors; (D) ability to effectively utilize and increase production capacity; (E) departure of key personnel and ability to source sufficient labor; (F) product performance, reliability and quality issues; (G) project management and installation issues that could affect the profitability of individual contracts; (H) changes in consumer and customer preference, or architectural trends and building codes; (I) dependence on a relatively small number of customers in one operating segment; (J) net sales and operating results that could differ from market expectations; (K) self-insurance risk related to a material product liability or other events for which the Company is liable; (L) dependence on information technology systems and information security threats; (M) cost of compliance with and changes in environmental regulations; (N) supply chain disruptions, including fluctuations in the availability and cost of materials used in our products and the impact of trade policies and regulations; (O) integration of acquisitions and management of acquired contracts; (P) impairment of goodwill or indefinite-lived intangible assets; (Q) our ability to successfully implement our strategy to become the economic leader in our target markets and build an operating model to enable profitable growth and execute our priorities for fiscal year 2024; (R) increases in costs related to employee health care benefits; (S) risks that anticipated results from business restructuring initiatives will not be achieved, implementation of cost-saving and business restructuring initiatives may take more time or cost more than expected, the anticipated cost savings may be materially less than anticipated, and the restructuring may result in disruption in delivery of services to our customers; (T) U.S. and global instability and uncertainty arising from events outside of our control; and (U) the impact of cost inflation and rising interest rates. The Company cautions investors that actual future results could differ materially from those described in the forward-looking statements and that other factors may in the future prove to be important in affecting the Company’s results, performance, prospects, or opportunities. New factors emerge from time to time and it is not possible for management to predict all such factors, nor can it assess the impact of each factor on the business or the extent to which any factor, or a combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. More information concerning potential factors that could affect future financial results is included in the Company’s Annual Report on Form 10-K for the fiscal year ended February 25, 2023, and in subsequent filings with the U.S. Securities and Exchange Commission.

______________________ 1 See Use of Non-GAAP Financial Measures and a reconciliation to the most directly comparable GAAP measures later in this press release.

2 Backlog is a non-GAAP financial measure. See Use of Non-GAAP Financial Measures later in this press release for more information.

3 Net leverage ratio is a non-GAAP financial measure. See Use of Non-GAAP Financial Measures later in this press release for more information.

4 See reconciliation of Fiscal 2024 estimated adjusted diluted earnings per share to GAAP diluted earnings per share later in this press release.

Apogee Enterprises, Inc.

Consolidated Condensed Statements of Income

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Six Months Ended

 

 

(In thousands, except per share amounts)

 

August 26, 2023

 

August 27, 2022

 

% Change

 

August 26, 2023

 

August 27, 2022

 

% Change

Net sales

 

$

353,675

 

 

$

372,109

 

 

(5.0

)%

 

$

715,388

 

 

$

728,744

 

(1.8

)%

Cost of sales

 

 

258,304

 

 

 

287,173

 

 

(10.1

)%

 

 

527,031

 

 

 

558,191

 

(5.6

)%

Gross profit

 

 

95,371

 

 

 

84,936

 

 

12.3

%

 

 

188,357

 

 

 

170,553

 

10.4

%

Selling, general and administrative expenses

 

 

54,818

 

 

 

52,864

 

 

3.7

%

 

 

114,037

 

 

 

105,265

 

8.3

%

Operating income

 

 

40,553

 

 

 

32,072

 

 

26.4

%

 

 

74,320

 

 

 

65,288

 

13.8

%

Interest expense, net

 

 

2,230

 

 

 

1,698

 

 

31.3

%

 

 

4,266

 

 

 

2,904

 

46.9

%

Other (income) expense, net

 

 

(4,900

)

 

 

173

 

 

N/M

 

 

 

(4,612

)

 

 

1,483

 

N/M

 

Earnings before income taxes

 

 

43,223

 

 

 

30,201

 

 

43.1

%

 

 

74,666

 

 

 

60,901

 

22.6

%

Income tax expense (benefit)

 

 

9,896

 

 

 

(7,188

)

 

N/M

 

 

 

17,763

 

 

 

781

 

2,174.4

%

Net earnings

 

$

33,327

 

 

$

37,389

 

 

(10.9

)%

 

$

56,903

 

 

$

60,120

 

(5.4

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share

 

$

1.54

 

 

$

1.71

 

 

(9.9

)%

 

$

2.61

 

 

$

2.72

 

(4.0

)%

Diluted earnings per share

 

$

1.52

 

 

$

1.68

 

 

(9.5

)%

 

$

2.57

 

 

$

2.66

 

(3.4

)%

Weighted average basic shares outstanding

 

 

21,708

 

 

 

21,860

 

 

(0.7

)%

 

 

21,813

 

 

 

22,129

 

(1.4

)%

Weighted average diluted shares outstanding

 

 

21,962

 

 

 

22,245

 

 

(1.3

)%

 

 

22,105

 

 

 

22,563

 

(2.0

)%

Cash dividends per common share

 

$

0.2400

 

 

$

0.2200

 

 

9.1

%

 

$

0.4800

 

 

$

0.4400

 

9.1

%

 

Apogee Enterprises, Inc.

Business Segment Information

(Unaudited)

 

 

Three Months Ended

 

 

 

Six Months Ended

 

 

(In thousands)

 

August 26, 2023

 

August 27, 2022

 

% Change

 

August 26, 2023

 

August 27, 2022

 

% change

Segment net sales

 

 

 

 

 

 

 

 

 

 

 

 

Architectural Framing Systems

 

$

158,801

 

 

$

172,867

 

 

(8.1

)%

 

$

322,963

 

 

$

336,159

 

 

(3.9

)%

Architectural Glass

 

 

94,096

 

 

 

77,352

 

 

21.6

%

 

 

191,298

 

 

 

153,617

 

 

24.5

%

Architectural Services

 

 

88,064

 

 

 

106,732

 

 

(17.5

)%

 

 

177,482

 

 

 

210,120

 

 

(15.5

)%

Large-Scale Optical

 

 

23,645

 

 

 

25,166

 

 

(6.0

)%

 

 

46,101

 

 

 

50,328

 

 

(8.4

)%

Intersegment eliminations

 

 

(10,931

)

 

 

(10,008

)

 

9.2

%

 

 

(22,456

)

 

 

(21,480

)

 

4.5

%

Net sales

 

$

353,675

 

 

$

372,109

 

 

(5.0

)%

 

$

715,388

 

 

$

728,744

 

 

(1.8

)%

Segment operating income (loss)

 

 

 

 

 

 

 

 

 

 

 

 

Architectural Framing Systems

 

$

21,060

 

 

$

20,512

 

 

2.7

%

 

$

41,005

 

 

$

44,177

 

 

(7.2

)%

Architectural Glass

 

 

17,434

 

 

 

6,457

 

 

170.0

%

 

 

33,955

 

 

 

11,626

 

 

192.1

%

Architectural Services

 

 

3,519

 

 

 

5,490

 

 

(35.9

)%

 

 

2,923

 

 

 

8,417

 

 

(65.3

)%

Large-Scale Optical

 

 

4,663

 

 

 

5,991

 

 

(22.2

)%

 

 

10,188

 

 

 

12,489

 

 

(18.4

)%

Corporate and other

 

 

(6,123

)

 

 

(6,378

)

 

(4.0

)%

 

 

(13,751

)

 

 

(11,421

)

 

20.4

%

Operating income

 

$

40,553

 

 

$

32,072

 

 

26.4

%

 

$

74,320

 

 

$

65,288

 

 

13.8

%

Segment operating margin

 

 

 

 

 

 

 

 

 

 

 

 

Architectural Framing Systems

 

 

13.3

%

 

 

11.9

%

 

 

 

 

12.7

%

 

 

13.1

%

 

 

Architectural Glass

 

 

18.5

%

 

 

8.3

%

 

 

 

 

17.7

%

 

 

7.6

%

 

 

Architectural Services

 

 

4.0

%

 

 

5.1

%

 

 

 

 

1.6

%

 

 

4.0

%

 

 

Large-Scale Optical

 

 

19.7

%

 

 

23.8

%

 

 

 

 

22.1

%

 

 

24.8

%

 

 

Corporate and other

 

 

N/M

 

 

 

N/M

 

 

 

 

 

N/M

 

 

 

N/M

 

 

 

Operating margin

 

 

11.5

%

 

 

8.6

%

 

 

 

 

10.4

%

 

 

9.0

%

 

 

• Segment net sales is defined as net sales for a certain segment and includes revenue related to intersegment transactions.
• Segment operating income is defined as operating income for a certain segment including operating income related to intersegment transactions and excluding certain corporate costs that are not allocated at a segment level.
• Segment operating margin is defined as segment operating income divided by segment net sales.

Apogee Enterprises, Inc.

Consolidated Condensed Balance Sheets

(Unaudited)

(In thousands)

 

August 26, 2023

 

February 25, 2023

Assets

 

 

 

 

Current assets

 

 

 

 

Cash and cash equivalents

 

$

18,423

 

$

19,924

Restricted cash

 

 

—

 

 

1,549

Receivables, net

 

 

205,720

 

 

197,267

Inventories

 

 

72,775

 

 

78,441

Contract assets

 

 

50,360

 

 

59,403

Other current assets

 

 

29,036

 

 

26,517

Total current assets

 

 

376,314

 

 

383,101

Property, plant and equipment, net

 

 

245,541

 

 

248,867

Operating lease right-of-use assets

 

 

41,049

 

 

41,354

Goodwill

 

 

129,143

 

 

129,026

Intangible assets, net

 

 

65,303

 

 

67,375

Other non-current assets

 

 

51,229

 

 

45,642

Total assets

 

$

908,579

 

$

915,365

Liabilities and shareholders' equity

 

 

 

 

Current liabilities

 

 

 

 

Accounts payable

 

 

78,323

 

 

86,549

Accrued compensation and benefits

 

 

34,156

 

 

51,651

Contract liabilities

 

 

32,498

 

 

28,011

Operating lease liabilities

 

 

12,168

 

 

11,806

Other current liabilities

 

 

67,141

 

 

64,532

Total current liabilities

 

 

224,286

 

 

242,549

Long-term debt

 

 

145,675

 

 

169,837

Non-current operating lease liabilities

 

 

31,962

 

 

33,072

Non-current self-insurance reserves

 

 

32,933

 

 

29,316

Other non-current liabilities

 

 

41,405

 

 

44,183

Total shareholders’ equity

 

 

432,318

 

 

396,408

Total liabilities and shareholders’ equity

$

908,579

$

915,365

 

Apogee Enterprises, Inc.

Consolidated Statement of Cash Flows

(Unaudited)

 

 

Six Months Ended

(In thousands)

 

August 26, 2023

 

August 27, 2022

Net earnings

 

$

56,903

 

 

$

60,120

 

Depreciation and amortization

 

 

20,661

 

 

 

21,448

 

Share-based compensation

 

 

4,483

 

 

 

3,394

 

Deferred income taxes

 

 

(4,281

)

 

 

6,858

 

Gain on disposal of assets

 

 

(62

)

 

 

(695

)

Proceeds from New Markets Tax Credit transaction, net of deferred costs

 

 

—

 

 

 

18,390

 

Settlement of New Markets Tax Credit transaction

 

 

(4,687

)

 

 

(19,523

)

Noncash lease expense

 

 

6,153

 

 

 

6,160

 

Other, net

 

 

(1,121

)

 

 

3,836

 

Changes in operating assets and liabilities:

 

 

 

 

Receivables

 

 

(8,238

)

 

 

(71,720

)

Inventories

 

 

5,841

 

 

 

(17,636

)

Contract assets

 

 

8,992

 

 

 

6,754

 

Accounts payable and accrued expenses

 

 

(21,096

)

 

 

(11,793

)

Contract liabilities

 

 

4,244

 

 

 

20,927

 

Refundable and accrued income taxes

 

 

4,292

 

 

 

(20,486

)

Operating lease liability

 

 

(6,608

)

 

 

(6,684

)

Prepaid expenses and other current assets

 

 

(2,912

)

 

 

(1,993

)

Net cash provided (used) by operating activities

 

 

62,564

 

 

 

(2,643

)

Capital expenditures

 

 

(15,018

)

 

 

(9,255

)

Proceeds from sales of property, plant and equipment

 

 

143

 

 

 

4,122

 

Purchases of marketable securities

 

 

(969

)

 

 

—

 

Sales/maturities of marketable securities

 

 

775

 

 

 

450

 

Net cash used by investing activities

 

 

(15,069

)

 

 

(4,683

)

Borrowings on line of credit

 

 

174,853

 

 

 

409,880

 

Repayment on debt

 

 

—

 

 

 

(151,000

)

Payments on line of credit

 

 

(199,000

)

 

 

(171,000

)

Payments on debt issuance costs

 

 

—

 

 

 

(687

)

Repurchase and retirement of common stock

 

 

(11,821

)

 

 

(74,312

)

Dividends paid

 

 

(10,467

)

 

 

(9,602

)

Other, net

 

 

(3,705

)

 

 

(2,815

)

Net cash (used) provided by financing activities

 

 

(50,140

)

 

 

464

 

Decrease in cash, cash equivalents and restricted cash

 

 

(2,645

)

 

 

(6,862

)

Effect of exchange rates on cash

 

 

(405

)

 

 

28

 

Cash, cash equivalents and restricted cash at beginning of year

 

 

21,473

 

 

 

37,583

 

Cash, cash equivalents and restricted cash at end of period

 

$

18,423

 

 

$

30,749

 

 

Apogee Enterprises, Inc.

Reconciliation of Non-GAAP Financial Measures

Adjusted Net Earnings and Adjusted Diluted Earnings per Share

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

(In thousands)

 

August 26, 2023

 

August 27, 2022

 

August 26, 2023

 

August 27, 2022

Net earnings

 

$

33,327

 

 

$

37,389

 

 

$

56,903

 

 

$

60,120

 

NMTC settlement gain(1)

 

 

(4,687

)

 

 

—

 

 

 

(4,687

)

 

 

—

 

Worthless stock deduction and related discrete tax benefits(2)

 

 

—

 

 

 

(13,702

)

 

 

—

 

 

 

(13,702

)

Income tax impact on above adjustments

 

 

1,148

 

 

 

—

 

 

 

1,148

 

 

 

—

 

Adjusted net earnings

 

$

29,788

 

 

$

23,687

 

 

$

53,364

 

 

$

46,418

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

August 26, 2023

 

August 27, 2022

 

August 26, 2023

 

August 27, 2022

Diluted earnings per share

 

$

1.52

 

 

$

1.68

 

 

$

2.57

 

 

$

2.66

 

NMTC settlement gain(1)

 

 

(0.21

)

 

 

—

 

 

 

(0.21

)

 

 

—

 

Worthless stock deduction and related discrete tax benefits(2)

 

 

—

 

 

 

(0.62

)

 

 

—

 

 

 

(0.61

)

Income tax impact on above adjustments

 

 

0.05

 

 

 

—

 

 

 

0.05

 

 

 

—

 

Adjusted diluted earnings per share

 

$

1.36

 

 

$

1.06

 

 

$

2.41

 

 

$

2.06

 

 

 

 

 

 

 

 

 

 

Weighted average diluted shares outstanding

 

 

21,962

 

 

 

22,245

 

 

 

22,105

 

 

 

22,563

 

(1)

Realization of a New Market Tax Credit (NMTC) benefit during the second quarter of fiscal 2024, which was recorded in other (income) expense, net.

(2)

Worthless stock deduction and related discrete income tax benefits from the impairment of the Sotawall business in fiscal 2023 which was recorded in income tax expense (benefit).

 

Apogee Enterprises, Inc.

Reconciliation of Non-GAAP Measure - Adjusted EBITDA

(Earnings before interest, taxes, depreciation and amortization)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

(In thousands)

 

August 26, 2023

 

August 27, 2022

 

August 26, 2023

 

August 27, 2022

Net earnings

 

$

33,327

 

 

$

37,389

 

 

$

56,903

 

 

$

60,120

Income tax expense (benefit)

 

 

9,896

 

 

 

(7,188

)

 

 

17,763

 

 

 

781

Interest expense, net

 

 

2,230

 

 

 

1,698

 

 

 

4,266

 

 

 

2,904

Depreciation and amortization

 

 

10,379

 

 

 

10,599

 

 

 

20,661

 

 

 

21,448

EBITDA

 

$

55,832

 

 

$

42,498

 

 

$

99,593

 

 

$

85,253

NMTC settlement gain(1)

 

 

(4,687

)

 

 

—

 

 

 

(4,687

)

 

 

—

Adjusted EBITDA

 

$

51,145

 

 

$

42,498

 

 

$

94,906

 

 

$

85,253

(1)

Realization of a New Market Tax Credit (NMTC) benefit during the second quarter of fiscal 2024, which was recorded in other (income) expense, net.

 

Apogee Enterprises, Inc.

Reconciliation of Non-GAAP Measure - Net Leverage

(Unaudited)

 

 

 

 

 

Net Debt (In thousands)

 

August 26, 2023

 

February 25, 2023

Total debt

 

$

145,675

 

 

$

169,837

Less: Cash and cash equivalents

 

 

18,423

 

 

 

19,924

Net Debt

 

$

127,252

 

 

$

149,913

 

 

 

 

 

 

 

Trailing twelve months ending

Adjusted EBITDA

 

August 26, 2023

 

February 25, 2023

Net earnings

 

 

100,890

 

 

 

104,107

Income tax expense

 

 

29,496

 

 

 

12,514

Interest expense, net

 

 

9,022

 

 

 

7,660

Depreciation and amortization

 

 

41,616

 

 

 

42,403

EBITDA

 

 

181,024

 

 

 

166,684

NMTC Settlement Gain(1)

 

 

(4,687

)

 

 

—

Adjusted EBITDA

 

 

176,337

 

 

 

166,684

 

 

 

 

 

Net Leverage

 

August 26, 2023

 

February 25, 2023

Net Debt

 

 

127,252

 

 

 

149,913

Adjusted EBITDA

 

 

176,337

 

 

 

166,684

Net Leverage

 

0.7 x

 

 

0.9 x

 

 

 

 

 

(1)

Realization of a New Market Tax Credit (NMTC) benefit during the second quarter of fiscal 2024, which was recorded in other (income) expense, net.

Apogee Enterprises, Inc.

Fiscal 2024 Outlook

Reconciliation of Fiscal 2024 outlook of estimated

Diluted Earnings per Share to Adjusted Diluted Earnings per Share

(Unaudited)

 

 

 

 

 

 

 

Fiscal Year Ending March 2, 2024

 

 

Low Range

 

High Range

Diluted earnings per share

 

$

4.51

 

 

$

4.81

 

NMTC settlement gain(1)

 

 

(0.21

)

 

 

(0.21

)

Income tax impact on above adjustments

 

 

0.05

 

 

 

0.05

 

Adjusted diluted earnings per share

 

$

4.35

 

 

$

4.65

 

(1)

Realization of a New Market Tax Credit (NMTC) benefit during the second quarter of fiscal 2024, which was recorded in other (income) expense, net.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230919516057/en/

Jeff Huebschen Vice President, Investor Relations & Communications 952.487.7538 ir@apog.com