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Astec Industries Reports Third Quarter 2015 Results

CHATTANOOGA, Tenn., Oct. 20, 2015 (GLOBE NEWSWIRE) -- Astec Industries, Inc. (Nasdaq:ASTE) today reported results for their third quarter ended September 30, 2015.

Net sales for the third quarter of 2015 were $211.4 million compared to $220.2 million for the third quarter of 2014, a 4% decrease. Earnings for the third quarter of 2015 were $2.3 million or $0.10 per diluted share compared to $1.9 million or $0.08 per diluted share in the third quarter of 2014, an increase of 25%.

Domestic sales increased 10% to $156.3 million for the third quarter of 2015 compared to $142.6 million for the third quarter of 2014. International sales decreased 29% to $55.1 million for the third quarter of 2015 compared to $77.6 million for the third quarter of 2014.

Net sales for the first nine months of 2015 were $768.1 million compared to $736.1 million for the first nine months of 2014, a 4% increase. Earnings for the first nine months of 2015 were $29.2 million or $1.26 per diluted share compared to $26.0 million or $1.12 per diluted share in the first nine months of 2014, a 12% increase.

Domestic sales increased 12% to $562.0 million for the first nine months of 2015 compared to $502.7 million for the first nine months of 2014. International sales were $206.1 million for the first nine months of 2015 compared to $233.4 million for the first nine months of 2014, a 12% decrease.

The Company’s domestic backlog decreased 1%, from $189.2 million at September 30, 2014 to $187.5 million at September 30, 2015. The international backlog at September 30, 2015 was $58.1 million compared to $105.8 million at September 30, 2014 for a decrease of 45%. Total backlog decreased 17% to $245.6 million at September 30, 2015 from $295.0 million at September 30, 2014.

Consolidated financial information for the quarter and nine months ended September 30, 2015 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 were pleased to improve our earnings by 25% in the third quarter versus the third quarter of last year, especially given the current headwinds we are facing, including low oil prices, the global mining slow down, the strong U.S. Dollar, and the absence of a long-term highway bill in the United States.”

Mr. Brock continued, “Low oil prices have hurt our Energy Group sales. The mining slowdown has hurt our Aggregate and Mining Group sales. The strong U.S. Dollar has hurt our international sales and the lack of a long-term highway bill has hurt all of our groups.”

Mr. Brock concluded, “Despite these headwinds, our year-to-date revenues are up 4% and our year-to-date earnings are up 12% versus last year. We have accomplished these increases through a variety of efforts, but two that stand out are our new product offerings that have allowed us to secure many of the orders we have shipped this year and our lean manufacturing initiatives which have improved margins and earnings. We remain committed to new product releases in each of our groups in order to earn more business moving ahead. Eventually the headwinds will subside and we will be well positioned to take advantage when they do.”

Investor Conference Call and Web Simulcast

Astec will conduct a conference call on October 20, 2015, at 10:00 A.M. Eastern Time to review its September 30, 2015 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, November 3, 2015 by dialing (877) 660-6853, or (201) 612-7415 for international callers, Account #286, Conference ID# 13622090. 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 low oil prices, the global mining slow down, the strong U.S. Dollar, and the absence of a long-term highway bill in the United States. 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, oil and liquid asphalt prices, rising steel prices, 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, 2014.

Astec Industries, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
Sept 30Sept 30
2015 2014
Assets
Current assets
Cash and cash equivalents$ 13,985 $ 13,820
Investments 1,834 1,903
Receivables, net 105,226 108,844
Inventories 384,531 370,436
Prepaid expenses and other 50,398 36,629
Total current assets 555,974 531,632
Property and equipment, net 170,508 190,395
Other assets 60,805 66,554
Total assets$ 787,287 $ 788,581
Liabilities and equity
Current liabilities
Accounts payable - trade$ 46,406 $ 53,034
Other current liabilities 91,568 97,059
Total current liabilities 137,974 150,093
Non-current liabilities 36,919 40,139
Total equity 612,394 598,349
Total liabilities and equity$ 787,287 $ 788,581
Astec Industries, Inc.
Condensed Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)
Three Months EndedNine Months Ended
Sept 30Sept 30
2015 2014 2015 2014
Net sales$ 211,350 $ 220,157 $ 768,141 $ 736,086
Cost of sales 166,212 176,896 594,724 573,890
Gross profit 45,138 43,261 173,417 162,196
Selling, general, administrative & engineering expenses 41,023 38,867 128,136 122,539
Income from operations 4,115 4,394 45,281 39,657
Interest expense 505 193 1,222 375
Other 844 860 3,212 2,410
Income before income taxes 4,454 5,061 47,271 41,692
Income taxes 2,162 3,145 18,070 15,734
Net income attributable to controlling interest $ 2,292 $ 1,916 $ 29,201 $ 25,958
Earnings per Common Share
Net income attributable to controlling interest
Basic$ 0.10 $ 0.08 $ 1.27 $ 1.14
Diluted$ 0.10 $ 0.08 $ 1.26 $ 1.12
Weighted average common shares outstanding
Basic 22,943 22,830 22,930 22,813
Diluted 23,121 23,109 23,118 23,103

Astec Industries, Inc.
Segment Revenues and Profits
For the three months ended September 30, 2015 and 2014
(in thousands)
(unaudited)
Infrastructure
Group
Aggregate
and Mining
Group
Energy
Group
CorporateTotal
2015 Revenues 85,625 80,549 45,176 - 211,350
2014 Revenues 78,698 88,177 53,282 - 220,157
Change $ 6,927 (7,628) (8,106) - (8,807)
Change % 8.8% (8.7)% (15.2)% - (4.0)%
2015 Gross Profit 16,104 19,226 9,794 14 45,138
2015 Gross Profit % 18.8% 23.9% 21.7% - 21.4%
2014 Gross Profit 11,367 21,604 10,277 13 43,261
2014 Gross Profit % 14.4% 24.5% 19.3% - 19.7%
Change 4,737 (2,378) (483) 1 1,877
2015 Profit (Loss) 2,116 3,790 1,941 (6,853) 994
2014 Profit (Loss) 520 6,806 2,789 (7,137) 2,978
Change $ 1,596 (3,016) (848) 284 (1,984)
Change % 306.9% (44.3)% (30.4)% 4.0% (66.6)%
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 September 30
2015 2014 Change $
Total profit for all segments$ 994 $ 2,978 $ (1,984)
Recapture (elimination) of intersegment profit 964 (1,212) 2,176
Net loss attributable to non-controlling interest 334 150 184
Net income attributable to controlling interest $ 2,292 $ 1,916 $ 376
Astec Industries, Inc.
Segment Revenues and Profits
For the nine months ended September 30, 2015 and 2014
(in thousands)
(unaudited)
Infrastructure
Group
Aggregate and
Mining Group
Energy
Group
CorporateTotal
2015 Revenues 336,768 285,790 145,583 - 768,141
2014 Revenues 296,074 287,976 152,036 - 736,086
Change $ 40,694 (2,186) (6,453) - 32,055
Change % 13.7% (0.8)% (4.2)% - 4.4%
2015 Gross Profit 74,292 70,182 28,912 31 173,417
2015 Gross Profit % 22.1% 24.6% 19.9% - 22.6%
2014 Gross Profit 59,135 70,722 32,309 30 162,196
2014 Gross Profit % 20.0% 24.6% 21.3% - 22.0%
Change 15,157 (540) (3,397) 1 11,221
2015 Profit (Loss) 29,472 25,441 2,805 (29,154) 28,564
2014 Profit (Loss) 21,124 27,065 7,659 (27,578) 28,270
Change $ 8,348 (1,624) (4,854) (1,576) 294
Change % 39.5% (6.0)% (63.4)% (5.7)% 1.0%
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):
Nine months ended September 30
2015 2014 Change $
Total profit for all segments$ 28,564 $ 28,270 $ 294
Elimination of intersegment profit (32) (2,468) 2,436
Net loss attributable to non-controlling interest 669 156 513
Net income attributable to controlling interest $ 29,201 $ 25,958 $ 3,243
Astec Industries, Inc.
Backlog by Segment
September 30, 2015 and 2014
(in thousands)
(unaudited)
Infrastructure
Group
Aggregate and
Mining Group
Energy
Group
Total
2015 Backlog 145,073 68,110 32,432 245,615
2014 Backlog 135,895 80,978 78,156 295,029
Change $ 9,178 (12,868) (45,724) (49,414)
Change % 6.8% (15.9)% (58.5)% (16.7)%



For Additional Information Contact: Benjamin G. Brock 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.com

Source:Astec Industries, Inc.