CHATTANOOGA, Tenn., July 21 /PRNewswire-FirstCall/ -- Astec Industries,
Inc. (Nasdaq: ASTE) today reported results for their second quarter ended June
30, 2008.
Net income for the second quarter of 2008 was $0.93 per diluted share
compared to $0.83 per diluted share for the second quarter of 2007 for a 12.0%
increase.
Revenues for the second quarter of 2008 were $277.7 million compared with
$226.4 million for the second quarter of 2007 for a 22.7% increase. Excluding
revenues attributable to Peterson Pacific Corp., which was acquired in July,
2007, revenues for the second quarter were $256.0 million for a 13.1%
increase. Domestic sales accounted for $184.7 million during the second
quarter of 2008 compared to $156.6 million during the second quarter of 2007.
International sales accounted for $93.0 million of revenues during the second
quarter of 2008 compared to $69.8 million during the second quarter of 2007.
The Company reported net income of $21.1 million for the second quarter of
2008 compared to net income of $18.5 million for the second quarter of 2007
for an increase of 14.1%. The Company's backlog at June 30, 2008 was $264.6
million compared to $235.4 million at June 30, 2007 (including backlog
attributable to Peterson) for a 12.4% increase.
Consolidated financial statements for the second quarter ended June 30,
2008 and additional information related to segment revenues and profits are
attached as addenda to this press release.
Commenting on the announcement, Dr. J. Don Brock, Chairman and Chief
Executive Officer, stated, "We are pleased with the Company's second quarter
earnings. International sales continue to be strong, accounting for 33.5% of
the second quarter volume. Gross margin for the quarter declined from 26.0%
for the second quarter of 2007 to 23.9% for the second quarter of 2008. Rapid
increases in the costs of steel and components were the primary reasons for
the decline in gross margin. Year-to-date gross margin for 2008 has only
declined 1.1% compared to the first half of 2007. We anticipate that
inflation will continue to be a challenge during the second half of 2008.
Some of our subsidiaries have implemented two price increases this year and
are reviewing the need for additional increases to maintain or improve gross
margins. We will continue our other initiatives to deal with inflation. We
look forward to the second half of 2008 with a backlog at June 30, 2008 of
$264.6 million compared to $263.0 million at March 31, 2008. Some of the
deliveries in the backlog extend beyond the third quarter of 2008. The cost
of oil and asphalt continues to cause states to increase the percentage of
recycled materials used for highway paving. Asphalt equipment sales have
improved and should continue to benefit from recycle related equipment sales."
Investor Conference Call and Web Simulcast
Astec will conduct a conference call on July 21, 2008 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/www/docs/100, Conference Calls Section. 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
Monday, July 28, 2008 by dialing (877) 660-6853, or (201) 612-7415 for
international callers, Account #286, Conference ID# 291359. A transcription
of the conference call will be made available under the Investor Relation
section of the Astec Industries, Inc. website within 5 days after the call.
Astec Industries, Inc. is a manufacturer of specialized equipment for
building and restoring the world's infrastructure. Astec's manufacturing
operations are divided into four business segments: aggregate processing and
mining equipment; asphalt production equipment; mobile asphalt paving
equipment; and underground boring, directional drilling and trenching
equipment. Astec also has a company engaged in the wood chipping and grinding
industry.
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 Company's financial performance for the third and fourth
quarters and future generally, the ability to maintain or improve margins, the
economy, inflation and our initiatives regarding inflation, the increase in
sales of recycling equipment and 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, downturns in the general economy or the commercial construction
industry, the cyclical nature of the commercial, construction industry and the
customization of the equipment the Company sells, increases in the price of
oil or decreases in the availability of oil, increases in the price of raw
materials, a failure to comply with covenants in the Company's credit
agreement, contingent liability for certain customer debt, rising interest
rates, rising steel and steel component pricing, delayed or decreased funding
for highway construction and maintenance, increased government regulation,
managing and expanding in international markets, the timing of large
contracts, the costs of introducing new equipment systems, the Company's
production capacity, demand for the Company's products, seasonality of sales
volumes, competitive activity 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, 2007.
Astec Industries, Inc. and Subsidiaries
Consolidated Balance Sheets
(In thousands)
(Unaudited)
Jun 30 Jun 30
2008 2007
Assets
Current assets
Cash and cash equivalents $39,491 $72,166
Receivables, net 107,853 81,984
Inventories 234,175 166,663
Prepaid expenses and other 16,925 14,073
Total current assets 398,444 334,886
Property and equipment, net 147,039 121,426
Other assets 51,916 31,527
Total assets $597,399 $487,839
Liabilities and shareholders' equity
Current liabilities
Accounts payable - trade $63,470 $47,679
Other accrued liabilities 94,541 73,129
Total current liabilities 158,011 120,808
Other non-current liabilities 22,620 20,673
Minority interest in consolidated
subsidiary 825 778
Total shareholders' equity 415,943 345,580
Total liabilities and shareholders'
equity $597,399 $487,839
Astec Industries, Inc. and Subsidiaries
Consolidated Statements of Operations
(In thousands)
(Unaudited)
Three Months Ended Six Months Ended
Jun 30 Jun 30
2008 2007 2008 2007
Net sales $277,703 $226,414 $540,775 $441,976
Cost of sales 211,414 167,471 408,266 328,660
Gross profit 66,289 58,943 132,509 113,316
Selling, general,
administrative &
engineering expenses 33,589 30,318 72,369 60,848
Income from operations 32,700 28,625 60,140 52,468
Interest expense 120 201 252 616
Other income, net of
expenses 412 714 839 1,400
Income before income taxes
and minority interest 32,992 29,138 60,727 53,252
Income taxes 11,921 10,584 22,080 19,330
Minority interest in
earnings (loss) (1) 49 56 83
Net income $21,072 $18,505 $38,591 $33,839
Earnings per Common Share
Net income
Basic $0.95 $0.85 $1.73 $1.55
Diluted $0.93 $0.83 $1.71 $1.52
Weighted average common
shares outstanding
Basic 22,283,071 21,879,134 22,260,085 21,762,265
Diluted 22,633,760 22,400,284 22,592,148 22,298,140
Astec Industries, Inc. and Subsidiaries
Segment Revenues and Profits
For the three months ended June 30, 2008 and 2007
(in thousands)
(Unaudited)
Aggregate Mobile
and Asphalt Under-
Asphalt Mining Paving ground All
Group Group Group Group Others Total
2008 Revenues 72,329 92,395 55,055 36,211 21,713 277,703
2007 Revenues 66,638 88,993 40,390 30,393 - 226,414
Change $ 5,691 3,402 14,665 5,818 21,713 51,289
Change % 8.5% 3.8% 36.3% 19.1% - 22.7%
2008 Gross Profit 18,001 22,528 13,557 8,307 3,897 66,290
2008 Gross Profit % 24.9% 24.4% 24.6% 22.9% 17.9% 23.9%
2007 Gross Profit (Loss) 18,056 22,866 10,721 7,315 (15) 58,943
2007 Gross Profit % 27.1% 25.7% 26.5% 24.1% - 26.0%
Change (55) (338) 2,836 992 3,912 7,347
2008 Profit (Loss) 11,445 11,910 8,037 3,544 (14,051) 20,885
2007 Profit (Loss) 11,718 12,330 5,748 2,279 (13,630) 18,445
Change $ (273) (420) 2,289 1,265 (421) 2,440
Change % (2.3%) (3.4%) 39.8% 55.5% (3.1%) 13.2%
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 consolidated net income is as follows:
For the three months ended June 30
2008 2007
Total profit for all segments $20,885 $18,445
Minority interest in loss (earnings)
of subsidiary 1 (49)
Recapture of intersegment profit 186 109
Consolidated net income $21,072 $18,505
Astec Industries, Inc. and Subsidiaries
Segment Revenues and Profits
For the six months ended June 30, 2008 and 2007
(in thousands)
(Unaudited)
Aggregate Mobile
and Asphalt Under-
Asphalt Mining Paving ground All
Group Group Group Group Others Total
2008 Revenues 143,914 183,484 102,186 68,854 42,337 540,775
2007 Revenues 131,647 171,337 84,339 54,653 - 441,976
Change $ 12,267 12,147 17,847 14,201 42,337 98,799
Change % 9.3% 7.1% 21.2% 26.0% - 22.4%
2008 Gross Profit 37,607 45,685 26,149 15,409 7,658 132,508
2008 Gross Profit % 26.1% 24.9% 25.6% 22.4% 18.1% 24.5%
2007 Gross Profit
(Loss) 35,983 43,745 20,902 12,711 (25) 113,316
2007 Gross Profit % 27.3% 25.5% 24.8% 23.3% - 25.6%
Change 1,624 1,940 5,247 2,698 7,683 19,192
2008 Profit (Loss) 23,289 22,169 14,565 5,389 (26,776) 38,636
2007 Profit (Loss) 23,171 22,705 11,225 3,292 (26,740) 33,653
Change $ 118 (536) 3,340 2,097 (36) 4,983
Change % 0.5% (2.4%) 29.8% 63.7% (0.1%) 14.8%
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 consolidated net income is as follows:
For the six months ended June 30
2008 2007
Total profit for all segments $38,636 $33,653
Minority interest in earnings of
subsidiary (56) (83)
Recapture of intersegment profit 11 269
Consolidated net income $38,591 $33,839
Astec Industries, Inc. and Subsidiaries
Backlog by Segment
June 30, 2008 and 2007
(in thousands)
(Unaudited)
Aggregate Mobile
and Asphalt Under-
Asphalt Mining Paving ground All
Group Group Group Group Others Total
2008 Backlog 123,273 104,852 5,373 18,443 12,683 264,624
2007 Backlog 101,373 100,892 11,856 14,730 6,530 235,381
Change $ 21,900 3,960 (6,483) 3,713 6,153 29,243
Change % 21.6% 3.9% (54.7%) 25.2% 94.2% 12.4%
SOURCE Astec Industries, Inc.
J. Don Brock, Chairman of the Board and CEO, +1-423-867-4210, Fax:
+1-423-867-4127, dbrock@astecindustries.com, or F. McKamy Hall, Vice President
and Chief Financial Officer, +1-423-899-5898, Fax: +1-423-899-4456,
mhall@astecindustries.com, or Stephen C. Anderson, Secretary and Director of
Investor Relations, +1-423-899-5898, Fax: +1-423-899-4456,
sanderson@astecindustries.com, all of Astec Industries, Inc.
