Apogee Enterprises Inc. Reports Mixed Q3 Results

By Bobby Samwell • Tuesday, January 07 15:25 • Permanent Link

Apogee Enterprises, Inc. has reported its fiscal 2025 third-quarter results, showcasing a mixed performance compared to the same period in the previous year. The company's net sales for the quarter were $341 million, showing a marginal increase of 0.5% from the third quarter of fiscal 2024. However, the operating margin saw a significant drop, declining to 8.4% from 11.1% in the same period last year.

The company's operating income for the quarter stood at $28.6 million, a decrease of 24.0% from the third quarter of fiscal 2024. Adjusted operating income also saw a decline of 5.9% to $35.4 million, with the adjusted operating margin decreasing by 70 basis points to 10.4%.

Diluted earnings per share (EPS) were reported at $0.96, down 22.0% from $1.23 in the third quarter of fiscal 2024. Adjusted diluted EPS also decreased by 3.3% to $1.19.

The acquisition of UW Solutions contributed $8.8 million in inorganic sales to the net sales figure. However, the company experienced a less favorable mix in architectural framing systems and lower volume in architectural glass, impacting the gross margin, which decreased to 26.1%.

Apogee Enterprises also provided segment-specific results, indicating performance variations across its architectural framing systems, architectural glass, architectural services, and large-scale optical segments.

The company's outlook for fiscal 2025 includes an anticipated 5% decline in net sales, with adjusted diluted EPS expected to be at the bottom of the guidance range of $4.90 to $5.20.

In terms of financial condition, net cash provided by operating activities in the third quarter decreased to $31.0 million from $66.7 million in the third quarter of fiscal 2024, primarily due to increased cash used for working capital. The company also reported an increase in net cash used by investing activities, primarily related to the acquisition of UW Solutions.

The quarter-end long-term debt increased to $272.0 million as the company increased borrowings on its existing credit facility to fund the acquisition of UW Solutions.

The market has reacted to these announcements by moving the company's shares -17.7% to a price of $58.51. For the full picture, make sure to review Apogee Enterprises's 8-K report.

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