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Astec Industries Reports Second Quarter 2015 Results

20:00 EDT 20 Jul 2015 | Globe Newswire

CHATTANOOGA, Tenn., July 21, 2015 (GLOBE NEWSWIRE) -- Astec Industries, Inc. (Nasdaq:ASTE) today reported results for their second quarter ended June 30, 2015. 

Net sales for the second quarter of 2015 were $268.0 million compared to $277.3 million for the second quarter of 2014, a 3% decrease. Earnings for the second quarter of 2015 were $11.8 million or $0.51 per diluted share compared to $14.5 million or $0.63 per diluted share for the second quarter of 2014, a decrease of 19%. 

Domestic sales increased 5% to $194.6 million for the second quarter of 2015 from $184.7 million for the second quarter of 2014. International sales were $73.4 million for the second quarter of 2015 compared to $92.6 million for the second quarter of 2014, a decrease of 21%.      

Net sales for the first half of 2015 were $556.8 million compared to $515.9 million for the first half of 2014, an 8% increase. Earnings for the first half of 2015 were $26.9 million or $1.16 per diluted share compared to $24.0 million or $1.04 per diluted share for the first half of 2014, an increase of 12%. 

Domestic sales increased 13% to $405.7 million for the first half of 2015 from $360.1 million for the first half of 2014. International sales were $151.1 million for the first half of 2015 compared to $155.8 million for the first half of 2014, a decrease of 3%.

The Company’s domestic backlog increased 9%, from $157.4 million at June 30, 2014 to $172.0 million at June 30, 2015. The international backlog at June 30, 2015 decreased 46% to $57.5 million compared to the June 30, 2014 international backlog of $106.7 million. 

Consolidated financial information for the second quarter and six months ended June 30, 2015 and additional information related to segment revenues and profits are attached as addenda to this press release.

Commenting on the announcement, Benjamin G. Brock, Chief Executive Officer, stated, “While we are disappointed with our second quarter results, we are pleased with our performance for the first half with sales up 8% and earnings up 12% over the first half of last year.”   

Mr. Brock continued, “Although the strong US dollar has hampered our international sales and backlog, we remain committed to our international sales effort and we will continue to develop new products for targeted global markets. With regard to our domestic market, we are encouraged that our infrastructure equipment customers have good backlogs of work overall, particularly in the private sector, and we are optimistic that our federal government will pass a long-term highway bill with increased funding by year end. This bill will provide the visibility that our customers need in order to increase their capital spending on equipment. In the meantime, we have seen the efforts in some states to fund highway projects through their own new funding mechanisms start to show up in the form of new project proposals and bids in those states.”

Mr. Brock concluded, “Despite the current headwinds in our international sales we are in a position to improve on last year’s third quarter results which will put us in a position to finish this year ahead of 2014’s full year results.”

Investor Conference Call and Web Simulcast

Astec will conduct a conference call on July 21, 2015 at 10:00 A.M. Eastern Time to review its second 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, August 4, 2015 by dialing (877) 660-6853, or (201) 612-7415 for international callers, Account #286, Conference ID# 13614127. 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 and production 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 its backlog, future federal highway funding and efforts to improve international sales. 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, 2014. 

For Additional Information Contact:
Benjamin G. Brock
Chief Executive Officer
Phone: (423) 867-4210
Fax: (423) 867-4127
E-mail: bbrock@astecindustries.com
or
David C. Silvious
Vice President and Chief Financial Officer
Phone: (423) 899-5898
Fax: (423) 899-4456
E-mail: dsilvious@astecindustries.com
or
Stephen C. Anderson
Vice President, Director of Investor Relations & Corporate Secretary
Phone: (423) 899-5898
Fax: (423) 899-4456
E-mail: sanderson@astecindustries.com

     
     
Astec Industries, Inc.  
Condensed Consolidated Balance Sheets  
(in thousands)  
(unaudited)  
   
 June 30June 30  
  2015  2014   
Assets    
Current assets    
Cash and cash equivalents$  16,353 $  18,624   
Investments   2,726    1,375   
Receivables, net   118,248    119,694   
Inventories   382,841    364,098   
Prepaid expenses and other   46,569    32,582   
Total current assets   566,737    536,373   
Property and equipment, net   174,971    193,552   
Other assets   62,083    73,214   
Total assets$  803,791 $  803,139   
Liabilities and equity    
Current liabilities    
Accounts payable - trade$  52,471 $  57,592   
Other current liabilities   92,412    102,440   
Total current liabilities   144,883    160,032   
Non-current liabilities   39,718    39,188   
Total equity   619,190    603,919   
Total liabilities and equity$  803,791 $  803,139   
     
     
     
     
Astec Industries, Inc.  
Condensed Consolidated Statements of Income  
(in thousands, except per share data)  
(unaudited)  
   
 Three Months EndedSix Months Ended
 June 30June 30
  2015  2014  2015  2014 
Net sales$  268,042 $  277,256 $  556,791 $  515,929 
Cost of sales   205,809    215,078    428,512    396,994 
Gross profit   62,233    62,178    128,279    118,935 
Selling, general, administrative & engineering expenses   43,308    40,247    87,112    83,672 
Income from operations   18,925    21,931    41,167    35,263 
Interest expense   420    109    717    182 
Other   420    736    2,368    1,550 
Income before income taxes   18,925    22,558    42,818    36,631 
Income taxes   7,120    8,061    15,909    12,589 
Net income attributable to controlling interest $  11,805 $  14,497 $  26,909 $  24,042 
     
     
     
     
Earnings per Common Share    
Net income attributable to controlling interest    
Basic$  0.51 $  0.64 $  1.17 $  1.05 
Diluted$  0.51 $  0.63 $  1.16 $  1.04 
     
     
Weighted average common shares outstanding    
Basic   22,942    22,822    22,923    22,804 
Diluted   23,119    23,099    23,117    23,101 
     

 

Astec Industries, Inc. 
Segment Revenues and Profits 
For the three months ended June 30, 2015 and 2014 
(in thousands) 
(unaudited) 
 Infrastructure
Group
Aggregate and Mining
Group
Energy
Group
CorporateTotal 
2015 Revenues   116,097    98,829    53,116    -     268,042  
2014 Revenues   118,585    106,691    51,980    -     277,256  
Change $   (2,488)   (7,862)   1,136    -     (9,214) 
Change % (2.1)% (7.4)% 2.2%   -   (3.3)% 
       
2015 Gross Profit   27,242    24,985    9,998    8    62,233  
2015 Gross Profit % 23.5% 25.3% 18.8%   -   23.2% 
2014 Gross Profit   25,089    25,694    11,390    5    62,178  
2014 Gross Profit % 21.2% 24.1% 21.9%   -   22.4% 
Change   2,153    (709)   (1,392)   3    55  
       
2015 Profit (Loss)   11,845    10,056    701    (10,334)   12,268  
2014 Profit (Loss)   11,808    11,158    2,946    (11,323)   14,589  
Change $   37    (1,102)   (2,245)   989    (2,321) 
Change % 0.3% (9.9)% (76.2)% 8.7% (15.9)% 
       
       
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 June 30  
   2015  2014 Change $  
Total profit for all segments$  12,268 $  14,589 $  (2,321)  
Elimination of intersegment profit   (610)   (99)   (511)  
Net loss attributable to non-controlling interest   147    7    140   
Net income attributable to controlling interest $  11,805 $  14,497 $  (2,692)  
       
       
Astec Industries, Inc. 
Segment Revenues and Profits 
For the six months ended June 30, 2015 and 2014 
(in thousands) 
(unaudited) 
 Infrastructure
Group
Aggregate and Mining
Group
Energy
Group
CorporateTotal 
2015 Revenues   251,143    205,241    100,407    -     556,791  
2014 Revenues   217,376    199,799    98,754    -     515,929  
Change $   33,767    5,442    1,653    -     40,862  
Change % 15.5% 2.7% 1.7%   -   7.9% 
       
2015 Gross Profit   58,188    50,957    19,117    17    128,279  
2015 Gross Profit % 23.2% 24.8% 19.0%   -   23.0% 
2014 Gross Profit   47,768    49,119    22,032    16    118,935  
2014 Gross Profit % 22.0% 24.6% 22.3%   -   23.1% 
Change   10,420    1,838    (2,915)   1    9,344  
       
2015 Profit (Loss)   27,356    21,650    864    (22,300)   27,570  
2014 Profit (Loss)   20,604    20,259    4,870    (20,441)   25,292  
Change $   6,752    1,391    (4,006)   (1,859)   2,278  
Change % 32.8% 6.9% (82.3)% (9.1)% 9.0% 
       
       
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): 
       
  Six months ended June 30  
   2015  2014 Change $  
Total profit for all segments$  27,570 $  25,292 $  2,278   
Elimination of intersegment profit   (996)   (1,256)   260   
Net loss attributable to non-controlling interest   335    6    329   
Net income attributable to controlling interest $  26,909 $  24,042 $  2,867   
       
       
Astec Industries, Inc.  
Backlog by Segment  
June 30, 2015 and 2014  
(in thousands)  
(Unaudited)  
 Infrastructure
Group
Aggregate and Mining
Group
Energy
Group
Total  
2015 Backlog   106,376    74,445    48,653    229,474   
2014 Backlog   109,380    89,147    65,568    264,095   
Change $   (3,004)   (14,702)   (16,915)   (34,621)  
Change % (2.7)% (16.5)% (25.8)% (13.1)%  
       


 

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