AZZ Inc's 4Q Earnings Beat by a Penny - Analyst Blog
09 April 2013 - 9:18PM
Zacks
Electrical equipment manufacturer AZZ Inc.
(AZZ) posted earnings per share of 50 cents in the fourth quarter
of fiscal 2013, a penny ahead of the Zacks Consensus Estimate. The
quarterly earnings also surpassed the year-ago earnings of 46 cents
per share.
In fiscal 2013, earnings per share were $2.01 versus $1.61 reported
in fiscal 2012, reflecting an increase of 24.8%.
Total Revenue
Total revenue increased 14% year over year to $140.4 million in the
reported quarter from $123.6 million a year ago. Better performance
from its Electrical and Industrial Products and Galvanizing Service
segments resulted in the upbeat results.
Revenues however missed the Zacks Consensus Estimate of $146
million.
Fiscal 2013 revenue was $570.6 million, up 22% from $469.1 million
in the prior fiscal.
Fiscal Fourth Quarter Highlights
Cost of sales, as a percentage of revenue, contracted 91 basis
points year over year. Operating income grew 0.9% to $26.3
million.
The backlog of the company at the end of the quarter was $221.7
million, up substantially from $138.6 million reported a year ago.
AZZ Inc. benefited from the acquired backlog of Nuclear Logistics
Inc, which came under its umbrella in Jun 2012.
The order booking of $146.3 million was also higher than $130.2
million booked in the comparable prior-year period. Overseas orders
constituted 35% of the backlog, which is an encouraging sign for
the company.
Interest expenses dropped to $3.27 million from $3.48 million,
indicating a reduction in the debt level.
Fiscal 2014 Guidance
The strong performance in fiscal 2013 prompted the company to make
an upward revision to its fiscal 2014 guidance. It now
expects earnings in the range of $2.65 to $2.95 per share, up from
the prior range of $2.50 to $2.75. The revised guidance takes into
account the likely contribution from the acquisition of Aquilex
SRO.
The company also revised its revenue expectation for fiscal
2014. Fiscal 2014 revenue is expected in the range of $825
million to $900 million, up from the previous expectation of $625
million to $660 million.
Other Company Release
Mistras Group Inc. (MG) reported earnings of 7
cents per share in the third quarter of fiscal 2013, falling short
of the Zacks Consensus Estimate of 17 cents. However, total revenue
of $134 million surpassed the Zacks Consensus Estimate by $2
million.
Our Take
We believe the strong backlog will definitely help the company to
post better results in the forthcoming quarters. We believe
international orders will not only boost its order book but provide
a cushion for the company against any softness in domestic demand.
In addition, strategic acquisitions will provide meaningful
synergies to the company’s performance.
The company currently has a Zacks Rank #1 (Strong Buy).
Universal Electronics Inc. (UEIC) and
Capstone Turbine Corp. (CPST) are also doing well
in this space, with both retaining a Zacks Rank #2 ( Buy).
Headquartered in Forts Worth, Texas, AZZ Inc. was founded in 1956.
With a market capitalization of $1.18 billion, the company
primarily caters to industrial customers in the United States and
Canada and has 2,154 full time employees.
AZZ INC (AZZ): Free Stock Analysis Report
CAPSTONE TURBIN (CPST): Free Stock Analysis Report
MISTRAS GROUP (MG): Free Stock Analysis Report
UNIVL ELECTRS (UEIC): Free Stock Analysis Report
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