Apogee Enterprises, Inc. APOG posted earnings per share of 69 cents in fourth-quarter fiscal 2016 (ended Feb 27, 2016) that surged 47% from earnings of 47 cents per share in the prior-year quarter. The improvement was driven by strong margins. Earnings beat the Zacks Consensus Estimate of 63 cents.
Operational Update
The company reported total revenues of $262 million, which increased 6% year over year. In constant currency, revenues increased 8% year over year. Revenues, however, fell short of the Zacks Consensus Estimate of $265 million.
Cost of goods sold increased 4% year over year to $193 million from $186 million in the year-ago quarter. Gross profit improved 13% year over year to $69 million. Gross margin also expanded 150 basis points (bps) to 26.3%. Selling, general and administrative (SG&A) expenses declined 4% year over year to $40 million. Operating income increased 47% year over year to $28.9 million. Operating margin grew 300 bps year over year to 11%.
Segment Performance
Revenues at the Architectural Glass segment increased 7% year over year to $98.6 million on U.S. volume growth and improved pricing. Operating income in the quarter shot up 169% to $12 million from $4.5 million in the prior-year quarter, aided by improved pricing and mix, strong operational performance and volume leverage.
Revenues at the Architectural Services segment rose 21% year over year to $76.8 million due to strong project activity. The segment reported an operating profit of $5.6 million, a 9% improvement from $5.2 million in the year-ago quarter on increased volume at better margins and good project execution.
The Architectural Framing Systems segment’s revenues increased 3% year over year to $79.6 million, led by U.S. volume growth and improved mix. The segment’s operating income grew 60% to $7.7 million from $4.8 million in the prior-year quarter, backed by lower raw material costs, volume leverage and execution of higher-margin window projects.
The Large-Scale Optical Technologies segment’s revenues went down 5% year over year to $21.7 million due to the timing of customer orders. Operating income in the reported quarter was $4.8 million, which dropped 19% from $5.9 million in the year-ago quarter.
Fiscal 2016 Performance
Apogee reported earnings per share of $2.22 in fiscal 2016, up 29% from prior-year earnings of $1.72 and ahead of the Zacks Consensus Estimate of $2.17. Earnings came in on the higher end of the guidance range of $2.15–$2.25. Revenues increased 5% year over year to $981 million, missing the Zacks Consensus Estimate of $984 million.