ASTEC INDUSTRIES, INC. REPORTS SECOND QUARTER 2005 RESULTS
CHATTANOOGA, Tenn. (July 20, 2005) - Astec Industries, Inc. (Nasdaq: ASTE) today reported results for the quarter ended June 30, 2005.
Income from continuing operations for the second quarter of 2005 was $10.2 million, or $.49 per diluted share, compared with income from continuing operations of $6.3 million, or $.31 per diluted share, for the second quarter of 2004 for a 61.6% increase in income from continuing operations.
As previously announced, the Company sold substantially all of the assets and liabilities of Superior Industries of Morris, Inc. (Superior) on June 30, 2004. The Company recognized a gain of $5.5 million, net of taxes of $5.0 million, on the sale of Superior in the second quarter of 2004. Superior's financial results are reported as income from discontinued operations on the statement of operations. Net income for the second quarter of 2005 was $.49 per diluted share compared to $.62 for the second quarter of 2004 which included discontinued operations of $.31 per diluted share.
Net sales from continuing operations for the quarter ended June 30, 2005 were $170.8 million compared to $145.9 million for the quarter ended June 30, 2004 for an increase of 17.0%. International sales for the second quarter of 2005 were 19.4% of total revenues versus 26.1% for the same period in 2004.
Net sales from continuing operations for the six months ended June 30, 2005 were $332.4 million compared to $281.7 million for the six months ended June 30, 2004 for an increase of 18%. International sales for the six months ended June 30, 2005 were 18.5% of total revenues versus 23.8% for the same period in 2004. Income from continuing operations for the six months ended June 30, 2005 was $17.0 million, or $.83 per diluted share, compared with income from continuing operations of $11.1 million, or $.55 per diluted share, for the same period in 2004.
Net income for the six months ended June 30, 2005 was $17.0 million, or $.83 per diluted share, compared to net income of $18.1 million, or $.90 per diluted share, for the six months ended June 30, 2004 which included $.35 per diluted share from discontinued operations.
Condensed consolidated financial statements and additional information related to segment revenues and profits are attached to this press release.
Astec's backlog for continuing operations at June 30, 2005, was $88.0 million compared with $68.7 million at June 30, 2004, for a 28.2% increase.
Commenting on the announcement, Dr. J. Don Brock, Chairman and Chief Executive Officer, stated, "We are very pleased with the increase in our sales and earnings in the second quarter of 2005 versus 2004. Our balance sheet continues to strengthen."
Comments Concerning The Second Quarter of 2005: The following discussion is a compilation of "forward-looking statements" intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act. Such statements are not guarantees of future performance and are subject to certain risks, uncertainties, assumptions and other factors, some of which are beyond the Company's control, that could cause actual results to differ materially from those anticipated as of the date of this Press Release.
Dr. J. Don Brock also stated, "We are disappointed in the delay of the reauthorization of TEA- 21 by Congress. Fluctuating oil prices continue to impact the cost of asphalt for our customers. Steel price increases seem to have stabilized and the cost increases in purchased components in the first quarter have moderated. We have a number of initiatives in our subsidiaries that are designed to improve gross margins. We are pleased with current backlog levels and order activity."
Investor Conference Call and Web Simulcast
Astec will conduct a conference call on July 20, 2005, 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 (800) 938-0653. International callers should dial (973) 935-2408. 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/investors, Conference Calls Section. An archived webcast will be available for 90 days atwww.astecindustries.com.
A replay of the conference call will be available through midnight on Wednesday, July 27, 2005 by dialing (877) 519-4471, or (973) 341-3080 for international callers - Confirmation #6252895. A transcription of the conference call will be made available under the Investor Relations section of the Astec Industries, Inc. website within 5 days after the call.
Astec Industries, Inc. is a manufacturer of specialized equipment for building and restoring the world's infrastructure. Astec's manufacturing operations are divided into four business segments: aggregate processing and mining equipment; asphalt production equipment; mobile asphalt paving equipment; and underground boring, directional drilling and trenching equipment.
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 Company's financial performance for the future generally, the Company's liquidity and strength of its balance sheet, the impact of fluctuating oil prices on the cost of asphalt for our customers; the initiatives in the Company's subsidiaries; the potential decrease in gross margins from the continued steel price increases and the resulting cost increases in purchased components, and the timing of any highway bill. 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 a nticipated. 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, downturns in the general economy or the commercial construction industry, increases in the price of oil or decreases in the availability of oil, increase in the price of raw materials, a failure to comply with covenants in the Company's amended credit agreement, contingent liability for certain customer debt, rising interest rates, rising steel and steel component pricing, delayed or decreased funding for highway construction and maintenance, the timing of large contracts, production capacity, general business conditions in the industry, demand for the Company's products, seasonality and cyclicality in operating results, seasonality of sales volumes, competitive activity 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, 2004.
For Additional Information Contact:
J. Don Brock
Chairman of the Board & C.E.O.
Phone: (423) 867-4210
Fax: (423) 867-4127
E-mail: dbrock@astecindustries.com
or
F. McKamy Hall
Vice President and Chief Financial Officer
Phone: (423) 899-5898
Fax: (423) 899-4456
E-mail: mhall@astecindustries.com
or
Stephen C. Anderson
Director of Investor Relations
Phone: (423) 899-5898
Fax: (423) 899-4456
E-mail:sanderson@astecindustries.com
Astec Industries, Inc. and Subsidiaries | | | |
Consolidated Balance Sheets | | | | |
(In thousands) | | | | |
(Unaudited) | | | | |
| | | | |
| June 30 | June 30 | | |
| 2005 | 2004 | | |
Assets | | | | |
Current Assets | | | | |
Cash and cash equivalents | $ 9,833 | $ 17,171 | | |
Receivables, net | 67,865 | 63,826 | | |
Inventories | 124,726 | 103,440 | | |
Prepaid expenses and other | 15,114 | 9,114 | | |
Total current assets | 217,538 | 193,551 | | |
Property and equipment, net
|
97,937
|
94,417
| | |
Other assets | 28,532 | 27,812 | | |
Total assets
|
$ 344,007
|
$ 315,780
| | |
Liabilities and shareholders' equity
| | | | |
Current liabilities | | | | |
Revolving credit loan | $ 3,347 | $ - | | |
Notes payable | - | 223 | | |
Current maturities of long-term debt | 3,310 | 6,857 | | |
Accounts payable - trade | 38,010 | 35,299 | | |
Other accrued liabilities | 50,808 | 47,637 | | |
Total current liabilities | 95,475 | 90,016 | | |
Long-term debt, less current
maturities
|
23,952
|
30,602
| | |
Other non-current liabilities | 14,681 | 7,850 | | |
Minority interest in consolidated subsidiary |
519
|
698
| | |
Total shareholders' equity | 209,380 | 186,614 | | |
Total liabilities and shareholders'
equity
|
$ 344,007
|
$ 315,780
| | |
Astec Industries, Inc. and Subsidiaries |
Consolidated Statements of Operations |
(In thousands) |
(unaudited) |
|
| Three Months Ended | Six Months Ended |
| June 30 | June 30 |
| 2005 | 2004 | 2005 | 2004 |
Net sales
|
$ 170,814
|
$ 145,937
|
$ 332,448
|
$ 281,665
|
Cost of sales
|
131,521
|
114,754
|
258,123
|
221,650
|
Gross profit
|
39,293
|
31,183
|
74,325
|
60,015
|
Selling, general, administrative & engineering expenses |
22,928
|
19,927
|
46,177
|
39,803
|
Income from operations
|
16,365
|
11,256
|
28,148
|
20,212
|
Interest expense
|
701
|
1,072
|
1,597
|
2,151
|
Other income, net
|
91
|
193
|
124
|
128
|
Income from continuing operations before income taxes
|
15,755
|
10,377
|
26,675
|
18,189
|
Income taxes on continuing operations
|
5,497
|
4,015
|
9,603
|
7,014
|
Minority interest in earnings
|
37
|
36
|
59
|
46
|
Income from continuing operations
|
10,221
|
6,326
|
17,013
|
11,129
|
Income from discontinued operations
|
- -
|
1,252
|
- -
|
2,307
|
Income taxes on discontinued operations
|
- -
|
(483)
|
- -
|
(888)
|
Gain on disposal of discontinued operations (net of tax of $4,970)
|
-
|
5,507
|
-
|
5,507
|
Net income
|
$ 10,221
|
$ 12,602
|
$ 17,013
|
$ 18,055
|
| | | | |
| | | | |
| | | | |
Earnings per Common Share
| | | | |
Income from continuing operations: | | | | |
Basic | $ 0.51 | $ 0.32 | $ 0.85 | $ 0.57 |
Diluted | $ 0.49 | $ 0.31 | $ 0.83 | $ 0.55 |
| | | | |
Income from discontinued operations: | | | | |
Basic | $ - | $ 0.32 | $ - | $ 0.35 |
Diluted | $ - | $ 0.31 | $ - | $ 0.35 |
| | | | |
Net income: | | | | |
Basic | $ 0.51 | $ 0.64 | $ 0.85 | $ 0.92 |
Diluted | $ 0.49 | $ 0.62 | $ 0.83 | $ 0.90 |
| | | | |
Weighted average common shares outstanding | | | |
Basic
| 20,008,425 | 19,691,359 | 19,954,422 | 19,666,055 |
Diluted
| 20,735,201 | 20,179,112 | 20,575,752 | 20,057,591 |
| | | | |
Certain amounts for 2004 have been reclassified to conform with the 2005 presentation.
Astec Industries, Inc. and Subsidiaries |
Segment Revenues and Profits |
For the three months ended June 30, 2005 and 2004 |
(dollars in thousands) |
(Unaudited) |
| Asphalt Group | Aggregate and Mining Group* | Mobile Asphalt Paving Group | Underground Group | All Others | Total |
2005 Revenues | 47,789 | 65,170 | 34,613 | 23,242 | - | 170,814 |
2004 Revenues | 44,325 | 56,975 | 26,519 | 18,073 | 45 | 145,937 |
Change $ | 3,464 | 8,195 | 8,094 | 5,169 | (45) | 24,877 |
Change % | 7.8% | 14.4% | 30.5% | 28.6% | (100.0%) | 17.0% |
| | | | | | |
2005 Gross Profit | 11,186 | 16,074 | 7,666 | 4,391 | (24) | 39,293 |
2005 Gross Profit % | 23.4% | 24.7% | 22.1% | 18.9% | 0.0% | 23.0% |
2004 Gross Profit | 9,356 | 13,148 | 6,029 | 2,930 | (280) | 31,183 |
2004 Gross Profit % | 21.1% | 23.1% | 22.7% | 16.2% | (622.2%) | 21.4% |
Change | 1,830 | 2,926 | 1,637 | 1,461 | 256 | 8,110 |
| | | | | | |
2005 Profit (Loss) | 6,383 | 7,501 | 3,663 | 748 | (8,090) | 10,205 |
2004 Profit (Loss) | 4,966 | 6,145 | 2,780 | 553 | (8,046) | 6,398 |
Change $ | 1,417 | 1,356 | 883 | 195 | (44) | 3,807 |
Change % | 28.5% | 22.1% | 31.8% | 35.3% | (0.5%) | 59.5% |
* The segment data for 2004 has been adjusted to reflect the sale of Superior Industries of Morris, Inc.
|
| | | | | | |
Segment revenues are reported net of intersegment revenues. Segment gross profit is net of profit on intersegment |
revenues. A reconciliation of total segment profits (losses) to the Company's consolidated net income is as follows: |
| | For the three months ended June 30 |
| | | 2005 | 2004 | |
Total profit for all segments | 10,205 | 6,398 |
Minority interest earnings of subsidiary | (37) | (36) |
Recapture (elimination) of intersegment profit | 53 | (36) |
Consolidated income from continuing operations | 10,221 | 6,326 |
Income from discontinued operations, net of tax | - | 769 |
Gain on sale of discontinued operations, net of tax | - | 5,507 |
Consolidated net income | 10,221 | 12,602 |
| | | | |
Astec Industries, Inc. and Subsidiaries |
Segment Revenues and Profits |
For the six months ended June 30, 2005 and 2004 |
(dollars in thousands) |
(Unaudited) |
| Asphalt Group | Aggregate and Mining Group* | Mobile Asphalt Paving Group | Underground Group | All Others | Total |
2005 Revenues | 101,324 | 123,014 | 63,420 | 44,690 | - | 332,448 |
2004 Revenues | 87,588 | 107,332 | 50,650 | 36,050 | 45 | 281,665 |
Change $ | 13,736 | 15,682 | 12,770 | 8,640 | (45) | 50,783 |
Change % | 15.7% | 14.6% | 25.2% | 24.0% | (100.0%) | 18.0% |
| | | | | | |
2005 Gross Profit | 21,843 | 29,674 | 14,682 | 8,165 | (39) | 74,325 |
2005 Gross Profit % | 21.6% | 24.1% | 23.2% | 18.3% | 0.0% | 22.4% |
2004 Gross Profit | 18,009 | 25,319 | 12,159 | 5,052 | (524) | 60,015 |
2004 Gross Profit % | 20.6% | 23.6% | 24.0% | 14.0% | (1164.4%) | 21.3% |
Change | 3,834 | 4,355 | 2,523 | 3,113 | 485 | 14,310 |
| | | | | | |
2005 Profit (Loss) | 12,039 | 12,686 | 7,093 | 904 | (15,639) | 17,083 |
2004 Profit (Loss) | 9,262 | 11,276 | 5,508 | (83) | (14,682) | 11,281 |
Change $ | 2,777 | 1,410 | 1,585 | 987 | (957) | 5,802 |
Change % | 30.0% | 12.5% | 28.8% | 1189.2% | (6.5%) | 51.4% |
* The segment data for 2004 has been adjusted to reflect the sale of Superior Industries of Morris, Inc. |
| | | | | | |
Segment revenues are reported net of intersegment revenues. Segment gross profit is net of profit on intersegment |
Revenues. A reconciliation of total segment profits (losses) to the Company's consolidated net income is as follows: |
| | For the six months ended June 30 |
| | | 2005 | 2004 |
Total profit for all segments | 17,083 | 11,281 |
Minority interest in earnings of subsidiary | (59) | (46) |
Elimination of intersegment profit | (11) | (106) |
Consolidated income from continuing operations | 17,013 | 11,129 |
Income from discontinued operations, net of tax | - | 1,419 |
Gain on sale of discontinued operations, net of tax | - | 5,507 |
Consolidated net income | 17,013 | 18,055 |
Astec Industries, Inc. and Subsidiaries |
Backlog by Segment |
June 30, 2005 and 2004 |
(dollars in thousands) |
(Unaudited) |
| Asphalt Group | Aggregate and Mining Group* | Mobile Asphalt Paving Group | Underground Group | All Others | Total |
2005 Backlog | 29,829 | 45,428 | 6,300 | 6,476 | - | 88,033 |
2004 Backlog | 14,158 | 36,565 | 5,457 | 12,498 | - | 68,678 |
Change $ | 15,671 | 8,863 | 843 | (6,022) | - | 19,355 |
Change % | 110.7% | 24.2% | 15.4% | (48.2%) | - | 28.2% |
* The segment data for 2004 has been adjusted to reflect the sale of Superior Industries of Morris, Inc.
|
