Apogee (APOG) Hikes Dividend, Share Repurchase Authorization

 | Jan 09, 2018 09:53PM ET

Apogee Enterprises, Inc.’s (NASDAQ:APOG) Board of Directors has approved a 12.5% hike in quarterly dividend and also increased existing share repurchase authorization by 1 million shares.

The company will now reward shareholders with a quarterly dividend payout of 15.75 cents per share compared with the current 14.0 cents. This translates to a dividend of 63 cents per share on an annualized basis. Based on the current 28.4 million shares outstanding, the hiked dividend will translate to a total payout of $17.9 million.

The raised dividend will be paid on Feb 14 to shareholders on record as of Jan 30. Based on the closing price of $46.00 as of Jan 9, the increased dividend translates to a yield of 1.37%. Apogee’s current dividend yield is much higher than the industry yield of 0.32%.
Also with the increase in share repurchase authorization, the company’s total available share repurchase program is currently at approximately 1.5 million shares. The increase in the authorization positions the company to occasionally buy back stock to offset dilution from its stock compensation programs.
Apogee, a leader in technologies for design and development of value-added glass products, possesses a strong cash balance that supports its effective capital deployment. The company remains focused on boosting shareholders’ value through dividend hikes as well as share buybacks. Further, it increases dividend payout each year. The last dividend hike was announced on Jan 11, 2016, when the company had raised the payout by 12% to 14 cents.
Apogee reported earnings per share of 82 cents in third-quarter fiscal 2018 (ended Dec 2, 2017), up 5% from 78 cents per share recorded in the prior-year quarter. As of the end of the quarter, Apogee had cash and cash equivalents of $12.8 million and debt-to-capitalization ratio of 30.84%.
During third-quarter 2018 earnings call, Apogee lowered fiscal 2018 guidance due to lesser-than-expected volume and pricing, primarily in the architectural glass segment, and higher-than-expected health care costs. It trimmed earnings per share guidance for the fiscal year to the range of $2.58-$2.68 from the previous band of $3.05-$3.25.