Acuity Brands (AYI) Tops Q3 Earnings Estimates, Margins Down
Zacks Investment Research | Jun 28, 2017 11:06PM ET
Acuity Brands, Inc. (NYSE:AYI) reported third-quarter fiscal 2017 adjusted earnings of $2.03 per share, beating the Zacks Consensus Estimate of $1.92 by about 5.7%. Earnings were adjusted by excluding 13 cents of non-recurring items. In spite of achieving record third-quarter net sales and earnings, the company’s profits were adversely impacted by higher-than-normal supply chain costs, including increased quality expenses and inbound freight charges.
Without the above adjustment, the company reported adjusted diluted earnings of $2.15 per share, up 4.4% from $2.06 a year ago.
Sales
Net sales during the quarter were $891.6 million, surpassing the Zacks Consensus Estimate of $881.4 million by 1.2%. The reported figure also increased 5% year over year.
The upside was mainly attributable to a 6% increase in volume, partly offset by a net unfavorable change in product prices and mix of products sold (price/mix) of approximately 1%. Sales volume improved across most key product categories and sales channels.
Operating Highlights
Adjusted gross profit margin was 42.5% in the third quarter, reflecting a decrease of 200 basis points (bps) year over year owing to higher-than-normal supply chain costs, including increased inbound freight costs and quality costs, and unfavorable price/mix.
Adjusted operating margin was 16.6%, down 60 bps year over year.
Adjusted selling, distribution and administrative expenses were $230.6 million or 25.9% of quarterly net sales, compared with $232.7 million or 27.3% a year ago. This was primarily due to lower incentive compensation expenses.
Financials
Cash and cash equivalents, as of May 31, 2017, were $189.7 million, compared with $413.2 million in fiscal 2016.
Net cash provided by operating activities was $179.3 million in the first nine months of fiscal 2017, down 26.5% from $243.9 million a year ago.
Notably, Acuity Brands completed the buyback of 2 million shares under its previously authorized stock repurchase program at a total cost of $357.9 million.
The company expects the North American lighting market to return to growth in fiscal 2018. It also expects to continue to outperform market growth rates by executing strategies focused on opportunities for new construction and renovation projects, expansion into underpenetrated geographies and channels, and continued introduction of lighting and building management.
Acuity Brands Inc Price, Consensus and EPS Surprise
Original post
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.