A month has gone by since the last earnings report for AptarGroup, Inc. ATR. Shares have added about 7.2% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
AptarGroup Beats on Q1 Earnings and Revenues
AptarGroup reported first-quarter 2017 earnings per share of $0.77, up 4% year over year. Earnings also beat the Zacks Consensus Estimate of $0.75. Earnings came at the higher end of the company’s guidance range of $0.72–$0.77 per share. On a reported basis, earnings per share increased 21% to $0.81 from $0.67 in the prior-year quarter.
Operational Update
Total revenue was up 3.3% year over year to $601 million in the reported quarter, surpassing the Zacks Consensus Estimate of $591 million. Excluding the negative impact from changes in currency exchange rates and the positive impact from acquisitions, core sales increased by 3%.
Cost of sales increased to $385 million from $374 million in the year-ago quarter. Gross profit improved 4% year over year to $385 million with gross margin expanding 30 basis points (bps) to 36%. Selling, research, development and administrative expenses went down 1% year over year to $101.5 million. Adjusted operating income increased 16% year over year to $69.5 million. AptarGroup’s operating margin expanded 130 bps year over year to 11.6%.
Segmental Performance
Total revenue in the Beauty and Homes segment went up 2.8% year over year to $322 million. Operating income decreased 6% to $22 million from $23.5 million in the year-ago quarter.
Total revenue in the Pharma segment went up 7.5% year over year to $197 million. Operating income grew 11% year over year to $59 million in the quarter.
Total revenue in the Food and Beverage segment dipped 3% year over year to $81.9 million. Operating income declined 23% year over year to $7.14 million.
Financial Performance
AptarGroup reported cash and cash equivalents of $284.7 million at the end of the first quarter, down from $466 million as of Dec 31, 2016. At the quarter end, long-term debt was approximately $771.3 million, down from $773 million as of Dec 31, 2016.
Outlook
For second-quarter 2017, AptarGroup expects earnings to be in the range of $0.92–$0.97. Comparable earnings per share for the prior year quarter were approximately $0.87.