AZZ Misses Earnings & Revenue Estimates In Q1, Reaffirms View
Zacks Investment Research | Jul 07, 2017 08:57AM ET
Electrical equipment manufacturer, AZZ Incorporated (NYSE:AZZ) posted earnings per share of 51 cents in the first quarter of fiscal 2018 (ended May 31, 2017), missing the Zacks Consensus Estimate by 19.61%.
Quarterly earnings were also down 37% from 81 cents per share reported in the year-ago quarter.
The year-over-year decline in earnings was due to lower operating income from the Energy and Metal Coatings) segments.
Total Revenue
AZZ reported first-quarter fiscal 2018 revenues of $208.6 million, lagging the Zacks Consensus Estimate of $217 million by 3.9%. Moreover, quarterly revenues dropped 14.05% from $242.7 million reported last year.
The top-line decline can primarily be attributed to the company’s industrial platform that struggled in its way and faced low refinery turnaround activity, resulting in revenues from only two projects instead of three as previously anticipated.
Revenues of the Energy and Metal Coatings segments declined 15.6% and 12%, respectively, at the end of the quarter.
Backlogs & Booking
AZZ 's backlog at the end of the quarter was $331.6 million, down 6.4% from $ 354.2 million a year ago. Nearly 41% of the backlog is related to customers outside the U.S.
Fiscal first-quarter order booking of $193.8 million was down 22.6% from $250.5 million booked in the comparable prior-year period.
Quarterly Highlights
Total operating income for the quarter under review fell 36.5% to $21.9 million compared with $34.5 million in the same period last year.
Selling, general and administrative expenses came in at $27.4 million, down 4.9% from $28.8 million in the prior-year quarter.
Interest expenses for the fiscal first quarter decreased to $3.4 million from $3.9 million reported in the prior-year period.
Looking Ahead
The management reaffirmed EPS guidance range for fiscal 2018 of $2.60–$3.10 and fiscal 2018 revenue of $880–$950 million.
In spite the current market dynamics and delays related to the Westinghouse nuclear projects, the company believes that it will benefit from improved infrastructure project spending during the second half of the year. This will be achieved by delivering organic growth through investing in additional metal coatings offerings to drive future sales to support strategic growth initiatives.
Price Movement
In the last six months, AZZ has underperformed the Zacks categorized Zacks Investment Research
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