Astec Industries, Inc. (Nasdaq:ASTE) on Tuesday reported results for the first quarter ended March 31, including a drop in sales and earnings.
Net sales for the first quarter of 2014 were $238.7 million compared to $247.8 million for the first quarter of 2013, a four percent decrease. Earnings for the first quarter of 2014 were $9.5 million or $0.41 per diluted share compared to $13.2 million for the first quarter of 2013 or $0.57 per diluted share, a decrease of 28 percent per diluted share.
Domestic sales increased eight percent to $175.5 million for the first quarter of 2014 from $161.9 million for the first quarter of 2013. International sales were $63.2 million for the first quarter of 2014 compared to $85.9 million for the first quarter of 2013, a decrease of 26 percent.
The company's backlog increased eight percent from $276.5 million at March 31, 2013 to $299.6 million at March 31, 2014. The domestic backlog increased 18% from $167.3 million at March 31, 2013 to $196.9 million at March 31, 2014. The international backlog at March 31, 2014 was $102.7 million, a 6% decrease from the March 31, 2013 international backlog of $109.2 million.
Commenting on the announcement, Benjamin G. Brock, chief executive officer, stated, "We are pleased with our growth in domestic revenues compared to last year although we continue to experience headwinds in our international sales efforts driven by the strong dollar and weakness in certain markets like Canada and Australia. Although total sales decreased slightly we held our gross margin steady which is a testament to our focus on lean manufacturing and cost management. Our presence at ConExpo in early March added $4 million to our S,G,A&E expenses for the quarter, however, we were pleased by the strong attendance in our booth and the interactions we had with customers.
"With the April 1st addition of Telestack headquartered in Omagh, Northern Ireland, we have demonstrated our commitment to further global expansion in our core products to better serve our target industries of Infrastructure, Aggregate and Mining, and Energy. Telestack's quality and customer service make it a natural fit for Astec. We expect them to be immediately accretive to earnings and to positively reinforce our backlog and outlook for the remainder of the year."
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).
|
Astec Industries, Inc. |
Consolidated Balance Sheets |
(in thousands) |
(unaudited) |
|
|
Mar 31 |
Mar 31 |
|
2014 |
2013 |
Assets |
|
|
Current assets |
|
|
Cash and cash equivalents |
$ 44,969 |
$ 73,175 |
Investments |
1,462 |
1,573 |
Receivables, net |
109,080 |
104,599 |
Inventories |
361,209 |
326,068 |
Prepaid expenses and other |
28,717 |
25,159 |
Total current assets |
545,437 |
530,574 |
Property and equipment, net |
187,895 |
186,192 |
Other assets |
41,372 |
40,890 |
Total assets |
$ 774,704 |
$ 757,656 |
Liabilities and equity |
|
|
Current liabilities |
|
|
Accounts payable - trade |
$ 59,364 |
$ 50,781 |
Other current liabilities |
93,596 |
111,451 |
Total current liabilities |
152,960 |
162,232 |
Non-current liabilities |
32,490 |
31,999 |
Total equity |
589,254 |
563,425 |
Total liabilities and equity |
$ 774,704 |
$ 757,656 |
|
|
Astec Industries, Inc. |
Consolidated Statements of Income |
(in thousands, except per share data) |
(unaudited) |
|
|
Three Months Ended |
|
Mar 31 |
|
2014 |
2013 |
Net sales |
$ 238,673 |
$ 247,833 |
Cost of sales |
181,916 |
189,266 |
Gross profit |
56,757 |
58,567 |
Selling, general, administrative & engineering expenses |
43,424 |
40,367 |
Income from operations |
13,333 |
18,200 |
Interest expense |
73 |
70 |
Other |
812 |
672 |
Income before income taxes |
14,072 |
18,802 |
Income taxes |
4,527 |
5,631 |
Net income attributable to controlling interest |
$ 9,545 |
$ 13,171 |
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per Common Share |
|
|
Net income attributable to controlling interest |
|
|
Basic |
$ 0.42 |
$ 0.58 |
Diluted |
$ 0.41 |
$ 0.57 |
|
|
|
|
|
|
Weighted average common shares outstanding |
|
|
Basic |
22,786 |
22,723 |
Diluted |
23,102 |
23,080 |
|
|
Astec Industries, Inc. |
Segment Revenues and Profits |
For the three months ended March 31, 2014 and 2013 |
(in thousands) |
(unaudited) |
|
Infrastructure Group |
Aggregate and Mining
Group |
Energy Group |
Corporate |
Total |
2014 Revenues |
98,791 |
93,108 |
46,774 |
-- |
238,673 |
2013 Revenues |
109,320 |
90,762 |
47,751 |
-- |
247,833 |
Change $ |
(10,529) |
2,346 |
(977) |
-- |
(9,160) |
Change % |
(9.6%) |
2.6% |
(2.0%) |
-- |
(3.7%) |
|
|
|
|
|
|
2014 Gross Profit |
22,679 |
23,424 |
10,642 |
12 |
56,757 |
2014 Gross Profit % |
23.0% |
25.2% |
22.8% |
-- |
23.8% |
2013 Gross Profit |
26,685 |
23,040 |
8,844 |
(2) |
58,567 |
2013 Gross Profit % |
24.4% |
25.4% |
18.5% |
-- |
23.6% |
Change |
(4,006) |
384 |
1,798 |
14 |
(1,810) |
|
|
|
|
|
|
2014 Profit (Loss) |
8,796 |
9,101 |
1,923 |
(9,117) |
10,703 |
2013 Profit (Loss) |
12,878 |
9,057 |
1,191 |
(9,260) |
13,866 |
Change $ |
(4,082) |
44 |
732 |
143 |
(3,163) |
Change % |
(31.7%) |
0.5% |
61.5% |
1.5% |
(22.8%) |
|
|
|
|
|
|
|
|
|
|
|
|
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 |
|
|
2014 |
2013 |
Change $ |
Total profit for all segments |
$ 10,703 |
$ 13,866 |
$ (3,163) |
Elimination of intersegment profit |
(1,156) |
(615) |
(541) |
Net income attributable to non-controlling interest |
(2) |
(80) |
78 |
Net income attributable to controlling interest |
$ 9,545 |
$ 13,171 |
$ (3,626) |
|
|
Astec Industries, Inc. |
Backlog by Segment |
March 31, 2014 and 2013 |
(in thousands) |
(Unaudited) |
|
Infrastructure Group |
Aggregate and Mining
Group |
Energy Group |
Total |
2014 Backlog |
$ 144,598 |
$ 98,903 |
$ 56,135 |
$ 299,636 |
2013 Backlog |
120,244 |
93,867 |
62,414 |
276,525 |
Change $ |
24,354 |
5,036 |
(6,279) |
23,111 |
Change % |
20.3% |
5.4% |
(10.1%) |
8.4% |
|
|
Astec Industries, Inc. |
Segment Revenues and Profits |
2013 |
(in thousands) |
(unaudited) |
|
Infrastructure Group |
Aggregate and Mining
Group |
Energy Group |
Corporate |
Total |
Q2 Revenues |
103,754 |
99,884 |
44,489 |
-- |
248,127 |
Q3 Revenues |
83,319 |
79,792 |
50,066 |
-- |
213,177 |
Q4 Revenues |
102,006 |
80,076 |
41,779 |
-- |
223,861 |
|
|
|
|
|
|
Q2 Gross Profit |
19,514 |
25,615 |
10,311 |
2 |
55,442 |
Q2 Gross Profit % |
18.8% |
25.6% |
23.2% |
-- |
22.3% |
Q3 Gross Profit |
18,552 |
19,584 |
7,667 |
(16) |
45,787 |
Q3 Gross Profit % |
22.3% |
24.5% |
15.3% |
-- |
21.5% |
Q4 Gross Profit |
20,676 |
19,610 |
7,103 |
(66) |
47,323 |
Q4 Gross Profit % |
20.3% |
24.5% |
17.0% |
-- |
21.1% |
|
|
|
|
|
|
Q2 Profit (Loss) |
6,103 |
11,141 |
2,235 |
(8,190) |
11,289 |
Q3 Profit (Loss) |
5,919 |
6,765 |
456 |
(5,935) |
7,205 |
Q4 Profit (Loss) |
7,914 |
6,068 |
123 |
(6,980) |
7,125 |
|
|
|
|
|
|
|
|
|
|
|
|
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 |
Three months ended
September 30 |
Three months ended
December 31 |
|
|
2013 |
2013 |
2013 |
Total profit for all segments |
$ 11,289 |
$ 7,205 |
$ 7,125 |
Elimination of intersegment profit |
(136) |
(678) |
1,159 |
Net income attributable to non-controlling interest |
(61) |
(13) |
(19) |
Net income attributable to controlling interest |
$ 11,092 |
$ 6,514 |
$ 8,265 |
|
Astec Industries, Inc. |
Backlog by Segment |
2013 |
|
(in thousands) |
(Unaudited) |
|
Infrastructure Group |
Aggregate and Mining
Group |
Energy Group |
Total |
Q2 Backlog |
$ 99,605 |
$ 88,706 |
$ 52,312 |
$ 240,623 |
Q3 Backlog |
114,138 |
69,583 |
44,816 |
228,537 |
Q4 Backlog |
137,119 |
105,022 |
48,101 |
290,242 |