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Astec Industries Reports Second Quarter 2014 Results

CHATTANOOGA, Tenn., July 22, 2014 (GLOBE NEWSWIRE) -- Astec Industries, Inc. (Nasdaq:ASTE) today reported results for their second quarter ended June 30, 2014.

Net sales for the second quarter of 2014 were $277.3 million compared to $248.1 million for the second quarter of 2013, a 12% increase. Earnings for the second quarter of 2014 were $14.5 million or $0.63 per diluted share compared to $11.1 million or $0.48 per diluted share for the second quarter of 2013, an increase of 31%.

Domestic sales increased 14% to $184.7 million for the second quarter of 2014 from $162.3 million for the second quarter of 2013. International sales were $92.6 million for the second quarter of 2014 compared to $85.8 million for the second quarter of 2013, an increase of 8%.

Net sales for the first half of 2014 were $515.9 million compared to $496.0 million for the first half of 2013, a 4% increase. Earnings for the first half of 2014 were $24.0 million or $1.04 per diluted share compared to $24.3 million or $1.05 per diluted share for the first half of 2013, a decrease of 1% per diluted share.

Domestic sales increased 11% to $360.1 million for the first half of 2014 from $324.3 million for the first half of 2013. International sales were $155.8 million for the first half of 2014 compared to $171.7 million for the first half of 2013, a decrease of 9%.

The Company's domestic backlog increased 12%, from $140.7 million at June 30, 2013 to $157.4 million at June 30, 2014. The international backlog at June 30, 2014 remained flat at $106.7 million, when compared to the June 30, 2013 international backlog of $106.6 million.

Consolidated financial information for the second quarter ended June 30, 2014 and additional information related to segment revenues and profits are attached as addenda to this press release.

Commenting on the announcement, Benjamin G. Brock, President and Chief Executive Officer, stated, "We are pleased with our performance during the second quarter. Both domestic and international sales increased during the quarter compared to our second quarter last year. Our total backlog is up 7% over June 30 of last year. We grew revenues and profits in each of our manufacturing segments on a quarterly and year-to-date basis."

Mr. Brock continued, "While we are up on sales and profit versus last year, we are cautious regarding our short-term prospects, particularly as they relate to infrastructure spending. Washington continues to pursue short-term extensions in lieu of a long-term funding bill that would provide visibility to our customers for their capital spending. We are seeing improved private markets for our customers and some states have new policies in place to help with funding of highway projects. That being said, we look forward to improving market conditions as our energy, aggregate, and mining businesses see stable to slightly better business in the near term."

Investor Conference Call and Web Simulcast

Astec will conduct a conference call on July 22, 2014 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/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, August 5, 2014 by dialing (877) 660-6853, or (201) 612-7415 for international callers, Account #286, Conference ID# 13586221. 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, anticipated federal infrastructure spending and new state funding policies. 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 effect 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)
June 30 June 30
2014 2013
Assets
Current assets
Cash and cash equivalents $ 18,624 $ 41,157
Investments 1,375 16,989
Receivables, net 119,694 102,795
Inventories 364,098 322,770
Prepaid expenses and other 32,423 30,177
Total current assets 536,214 513,888
Property and equipment, net 193,552 185,033
Other assets 73,214 41,954
Total assets $ 802,980 $ 740,875
Liabilities and equity
Current liabilities
Accounts payable - trade $ 57,592 $ 45,776
Other current liabilities 102,281 93,803
Total current liabilities 159,873 139,579
Non-current liabilities 39,188 32,531
Total equity 603,919 568,765
Total liabilities and equity $ 802,980 $ 740,875
Astec Industries, Inc.
Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)
Three Months Ended Six Months Ended
June 30 June 30
2014 2013 2014 2013
Net sales $ 277,256 $ 248,127 $ 515,929 $ 495,960
Cost of sales 215,078 192,685 396,994 381,951
Gross profit 62,178 55,442 118,935 114,009
Selling, general, administrative & engineering expenses 40,247 37,795 83,672 78,162
Income from operations 21,931 17,647 35,263 35,847
Interest expense 109 76 182 147
Other 736 (29) 1,550 644
Income before income taxes 22,558 17,542 36,631 36,344
Income taxes 8,061 6,450 12,589 12,081
Net income attributable to controlling interest $ 14,497 $ 11,092 $ 24,042 $ 24,263
Earnings per Common Share
Net income attributable to controlling interest
Basic $ 0.64 $ 0.49 $ 1.05 $ 1.07
Diluted $ 0.63 $ 0.48 $ 1.04 $ 1.05
Weighted average common shares outstanding
Basic 22,822 22,752 22,804 22,738
Diluted 23,099 23,069 23,101 23,075
Astec Industries, Inc.
Segment Revenues and Profits
For the three months ended June 30, 2014 and 2013
(in thousands)
(unaudited)
Infrastructure
Group
Aggregate and Mining
Group
Energy
Group

Corporate

Total
2014 Revenues 118,585 106,691 51,980 -- 277,256
2013 Revenues 103,754 99,884 44,489 -- 248,127
Change $ 14,831 6,807 7,491 -- 29,129
Change % 14.3% 6.8% 16.8% -- 11.7%
2014 Gross Profit 25,089 25,694 11,390 5 62,178
2014 Gross Profit % 21.2% 24.1% 21.9% -- 22.4%
2013 Gross Profit 19,514 25,615 10,311 2 55,442
2013 Gross Profit % 18.8% 25.6% 23.2% -- 22.3%
Change 5,575 79 1,079 3 6,736
2014 Profit (Loss) 11,808 11,158 2,946 (11,323) 14,589
2013 Profit (Loss) 6,103 11,141 2,235 (8,190) 11,289
Change $ 5,705 17 711 (3,133) 3,300
Change % 93.5% 0.2% 31.8% (38.3%) 29.2%

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 net income attributable to controlling interest is as follows (in thousands):

Three months ended June 30
2014 2013 Change $
Total profit for all segments $ 14,589 $ 11,289 $ 3,300
Elimination of intersegment profit (99) (136) 37
Net income attributable to non-controlling interest 7 (61) 68
Net income attributable to controlling interest $ 14,497 $ 11,092 $ 3,405
Astec Industries, Inc.
Segment Revenues and Profits
For the six months ended June 30, 2014 and 2013
(in thousands)
(unaudited)
Infrastructure
Group
Aggregate and Mining
Group
Energy
Group

Corporate

Total
2014 Revenues 217,376 199,799 98,754 -- 515,929
2013 Revenues 213,074 190,646 92,240 -- 495,960
Change $ 4,302 9,153 6,514 -- 19,969
Change % 2.0% 4.8% 7.1% -- 4.0%
2014 Gross Profit 47,768 49,119 22,032 16 118,935
2014 Gross Profit % 22.0% 24.6% 22.3% -- 23.1%
2013 Gross Profit 46,199 48,655 19,155 -- 114,009
2013 Gross Profit % 21.7% 25.5% 20.8% -- 23.0%
Change 1,569 464 2,877 16 4,926
2014 Profit (Loss) 20,604 20,259 4,870 (20,441) 25,292
2013 Profit (Loss) 18,981 20,198 3,426 (17,450) 25,155
Change $ 1,623 61 1,444 (2,991) 137
Change % 8.6% 0.3% 42.1% (17.1%) 0.5%

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):

Six months ended June 30
2014 2013 Change $
Total profit for all segments $ 25,292 $ 25,155 $ 137
Elimination of intersegment profit (1,256) (752) (504)
Net income attributable to non-controlling interest 6 (140) 146
Net income attributable to controlling interest $ 24,042 $ 24,263 $ (221)
Astec Industries, Inc.
Backlog by Segment
June 30, 2014 and 2013
(in thousands)
(Unaudited)
Infrastructure
Group
Aggregate and Mining
Group
Energy
Group
Total
2014 Backlog 109,380 89,147 65,568 264,095
2013 Backlog 99,605 95,343 52,312 247,260
Change $ 9,775 (6,196) 13,256 16,835
Change % 9.8% (6.5%) 25.3% 6.8%

CONTACT: For Additional Information Contact: Benjamin G. Brock President & Chief Executive Officer Phone: (423) 867-4210 Fax: (423) 867-4127 E-mail: dbrock@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.