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Astec Industries Reports First Quarter 2014 Results

CHATTANOOGA, Tenn., April 22, 2014 (GLOBE NEWSWIRE) -- Astec Industries, Inc. (Nasdaq:ASTE) today reported results for their first quarter ended March 31, 2014.

Net sales for the first quarter of 2014 were $238.7 million compared to $247.8 million for the first quarter of 2013, a 4% decrease. Earnings for the first quarter of 2014 were $9.5 million or $0.41 per diluted share compared to $13.2 million for the first quarter of 2013 or $0.57 per diluted share, a decrease of 28% per diluted share.

Domestic sales increased 8% to $175.5 million for the first quarter of 2014 from $161.9 million for the first quarter of 2013. International sales were $63.2 million for the first quarter of 2014 compared to $85.9 million for the first quarter of 2013, a decrease of 26%.

The Company's backlog increased 8% from $276.5 million at March 31, 2013 to $299.6 million at March 31, 2014. The domestic backlog increased 18% from $167.3 million at March 31, 2013 to $196.9 million at March 31, 2014. The international backlog at March 31, 2014 was $102.7 million, a 6% decrease from the March 31, 2013 international backlog of $109.2 million.

Consolidated financial information for the first quarter ended March 31, 2014 and additional information related to segment revenues and profits are attached as addenda to this press release.

As previously discussed in the Company's annual report on Form 10-K for the year ended December 31, 2013, due to the recent reallocation of certain product lines between some of the Company's subsidiaries, the Company has been reevaluating its reportable segments. This process has now been completed and the composition of the Company's reportable segments has been changed. Recast historical segment information is included in the financial information attached as addenda to this press release.

Commenting on the announcement, Benjamin G. Brock, Chief Executive Officer, stated, "We are pleased with our growth in domestic revenues compared to last year although we continue to experience headwinds in our international sales efforts driven by the strong dollar and weakness in certain markets like Canada and Australia. Although total sales decreased slightly we held our gross margin steady which is a testament to our focus on lean manufacturing and cost management. Our presence at ConExpo in early March added $4 million to our S,G,A&E expenses for the quarter, however, we were pleased by the strong attendance in our booth and the interactions we had with customers."

Mr. Brock continued, "With the April 1st addition of Telestack headquartered in Omagh, Northern Ireland, we have demonstrated our commitment to further global expansion in our core products to better serve our target industries of Infrastructure, Aggregate and Mining, and Energy. Telestack's quality and customer service make it a natural fit for Astec. We expect them to be immediately accretive to earnings and to positively reinforce our backlog and outlook for the remainder of the year."

Investor Conference Call and Web Simulcast

Astec will conduct a conference call on April 22, 2014, at 10:00 A.M. Eastern Time to review its first 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/conferencecalls. 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 Tuesday, May 6, 2014 by dialing (877) 660-6853, or (201) 612-7415 for international callers, Account #286, Conference ID# 13580080. A transcription of the conference call will be made available under the Investor Relations section of the Astec Industries, Inc. website within 5 business days after the call.

Astec Industries, Inc. is a manufacturer of specialized equipment for asphalt road building; aggregate processing; oil, gas and water well drilling; and wood processing. Astec's manufacturing operations are divided into three primary business segments: road building and related equipment (Infrastructure Group); aggregate processing and mining equipment (Aggregate and Mining Group); and equipment for the extraction and production of fuels, biomass production, and water drilling equipment (Energy Group).

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 effects on the Company from its backlog and the effects of general economic and political uncertainty on our business. 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, rising oil and liquid asphalt prices, rising steel prices, the affect of any future federal stimulus package, decreased funding for highway projects, the relative strength/weakness of the dollar to foreign currencies, production capacity, general business conditions in the industry, demand for the Company's products, seasonality and cyclicality in operating results, seasonality of sales volumes or lower than expected sales volumes, lower than expected margins on custom equipment orders, competitive activity, tax rates and the impact of future legislation thereon, 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, 2013.

Astec Industries, Inc.
Consolidated Balance Sheets
(in thousands)
(unaudited)
Mar 31 Mar 31
2014 2013
Assets
Current assets
Cash and cash equivalents $ 44,969 $ 73,175
Investments 1,462 1,573
Receivables, net 109,080 104,599
Inventories 361,209 326,068
Prepaid expenses and other 28,717 25,159
Total current assets 545,437 530,574
Property and equipment, net 187,895 186,192
Other assets 41,372 40,890
Total assets $ 774,704 $ 757,656
Liabilities and equity
Current liabilities
Accounts payable - trade $ 59,364 $ 50,781
Other current liabilities 93,596 111,451
Total current liabilities 152,960 162,232
Non-current liabilities 32,490 31,999
Total equity 589,254 563,425
Total liabilities and equity $ 774,704 $ 757,656
Astec Industries, Inc.
Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)
Three Months Ended
Mar 31
2014 2013
Net sales $ 238,673 $ 247,833
Cost of sales 181,916 189,266
Gross profit 56,757 58,567
Selling, general, administrative & engineering expenses 43,424 40,367
Income from operations 13,333 18,200
Interest expense 73 70
Other 812 672
Income before income taxes 14,072 18,802
Income taxes 4,527 5,631
Net income attributable to controlling interest $ 9,545 $ 13,171
Earnings per Common Share
Net income attributable to controlling interest
Basic $ 0.42 $ 0.58
Diluted $ 0.41 $ 0.57
Weighted average common shares outstanding
Basic 22,786 22,723
Diluted 23,102 23,080
Astec Industries, Inc.
Segment Revenues and Profits
For the three months ended March 31, 2014 and 2013
(in thousands)
(unaudited)

Infrastructure Group
Aggregate and Mining
Group

Energy Group

Corporate

Total
2014 Revenues 98,791 93,108 46,774 -- 238,673
2013 Revenues 109,320 90,762 47,751 -- 247,833
Change $ (10,529) 2,346 (977) -- (9,160)
Change % (9.6%) 2.6% (2.0%) -- (3.7%)
2014 Gross Profit 22,679 23,424 10,642 12 56,757
2014 Gross Profit % 23.0% 25.2% 22.8% -- 23.8%
2013 Gross Profit 26,685 23,040 8,844 (2) 58,567
2013 Gross Profit % 24.4% 25.4% 18.5% -- 23.6%
Change (4,006) 384 1,798 14 (1,810)
2014 Profit (Loss) 8,796 9,101 1,923 (9,117) 10,703
2013 Profit (Loss) 12,878 9,057 1,191 (9,260) 13,866
Change $ (4,082) 44 732 143 (3,163)
Change % (31.7%) 0.5% 61.5% 1.5% (22.8%)
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 net income attributable to controlling interest is as follows (in thousands):
Three months ended March 31
2014 2013 Change $
Total profit for all segments $ 10,703 $ 13,866 $ (3,163)
Elimination of intersegment profit (1,156) (615) (541)
Net income attributable to non-controlling interest (2) (80) 78
Net income attributable to controlling interest $ 9,545 $ 13,171 $ (3,626)
Astec Industries, Inc.
Backlog by Segment
March 31, 2014 and 2013
(in thousands)
(Unaudited)

Infrastructure Group
Aggregate and Mining
Group

Energy Group

Total
2014 Backlog $ 144,598 $ 98,903 $ 56,135 $ 299,636
2013 Backlog 120,244 93,867 62,414 276,525
Change $ 24,354 5,036 (6,279) 23,111
Change % 20.3% 5.4% (10.1%) 8.4%
Astec Industries, Inc.
Segment Revenues and Profits
2013
(in thousands)
(unaudited)

Infrastructure Group
Aggregate and Mining
Group

Energy Group

Corporate

Total
Q2 Revenues 103,754 99,884 44,489 -- 248,127
Q3 Revenues 83,319 79,792 50,066 -- 213,177
Q4 Revenues 102,006 80,076 41,779 -- 223,861
Q2 Gross Profit 19,514 25,615 10,311 2 55,442
Q2 Gross Profit % 18.8% 25.6% 23.2% -- 22.3%
Q3 Gross Profit 18,552 19,584 7,667 (16) 45,787
Q3 Gross Profit % 22.3% 24.5% 15.3% -- 21.5%
Q4 Gross Profit 20,676 19,610 7,103 (66) 47,323
Q4 Gross Profit % 20.3% 24.5% 17.0% -- 21.1%
Q2 Profit (Loss) 6,103 11,141 2,235 (8,190) 11,289
Q3 Profit (Loss) 5,919 6,765 456 (5,935) 7,205
Q4 Profit (Loss) 7,914 6,068 123 (6,980) 7,125
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 net income attributable to controlling interest is as follows (in thousands):
Three months ended
June 30
Three months ended
September 30
Three months ended
December 31
2013 2013 2013
Total profit for all segments $ 11,289 $ 7,205 $ 7,125
Elimination of intersegment profit (136) (678) 1,159
Net income attributable to non-controlling interest (61) (13) (19)
Net income attributable to controlling interest $ 11,092 $ 6,514 $ 8,265
Astec Industries, Inc.
Backlog by Segment
2013
(in thousands)
(Unaudited)

Infrastructure Group
Aggregate and Mining
Group

Energy Group

Total
Q2 Backlog $ 99,605 $ 88,706 $ 52,312 $ 240,623
Q3 Backlog 114,138 69,583 44,816 228,537
Q4 Backlog 137,119 105,022 48,101 290,242

CONTACT: For Additional Information Contact: Benjamin G. Brock President and Chief Executive Officer Phone: (423) 867-4210 Fax: (423) 867-4127 E-mail: bbrock@astecindustries.com or David C. Silvious Vice President and Chief Financial Officer Phone: (423) 899-5898 Fax: (423) 899-4456 E-mail: dsilvious@astecindustries.com or Stephen C. Anderson Vice President, Director of Investor Relations & Corporate Secretary Phone: (423) 899-5898 Fax: (423) 899-4456 E-mail: sanderson@astecindustries.comSource:Astec Industries, Inc.