Stock Monitor: AZZ Inc. Post Earnings Reporting
LONDON, UK / ACCESSWIRE / July 11, 2018 / If you want access to our free earnings report on Actuant Corp. (NYSE: ATU), all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=ATU. The Company reported its third quarter fiscal 2018 operating and financial results on June 20, 2018. The industrial products Company outperformed top- and bottom-line expectations. Additionally, the Company raised its sales guidance for FY18. Register today and get access to over 1,000 Free Research Reports by joining our site below:
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Earnings Highlights and Summary
For the third quarter of the fiscal year 2018, Actuant's consolidated sales were $317.1 million, 7% higher than $295.4 million in Q3 FY17, and were ahead of analysts' estimates of $305.9 million. The Company's core sales improved 4% on a y-o-y basis in the reported quarter, while foreign currency rate changes increased sales by 4% and the net impact from the Mirage acquisition net of the Viking divestiture reduced sales by 1%.
For Q3 FY18, Actuant reported net earnings of $29.0 million, or $0.48 per share, compared to $22.5 million, or $0.37 per share, in Q3 FY17. The Company's results for the reported quarter included restructuring charges of $1.2 million and a benefit of $4.9 million related to an adjustment to the original provision for the US tax reform based on further IRS clarifications. On the other hand, the results for Q3 FY17 included restructuring charges of $0.4 million and an income tax benefit of $3.2 million.
Excluding these items, Actuant's adjusted diluted earnings per share (EPS) were $0.39 in Q3 FY18 compared to $0.32 in Q3 FY17. The Company's earnings results for the reported quarter exceeded Wall Street's estimates of $0.36 per share.
During Q3 FY18, Actuant's Industrial segment's sales jumped 8% to $108.3 million compared to $100.5 million in Q3 FY17. The segment's results for the reported quarter were benefited by 4% due to favorable currency exchange rates, resulting in a core sales growth of 4% y-o-y. The sales of standard industrial tools remained strong, growing double digits on a global basis, with a broad demand across the diverse set of end markets served, despite tougher comparables. The Industrial segment's adjusted operating profit margin was 23.9%, and were level with the prior year's same quarter.
For Q3 FY18, Actuant's Energy segment's sales were marginally higher at $83.9 million compared to $83.5 million in Q3 FY17. The favorable impact of the weaker US dollar of 3% was offset by a headwind of 2% from the net of the Viking divestiture and Mirage acquisition, while core sales declined 1%. The segment's adjusted operating margin was 8.4% in the reported quarter, substantially higher versus 1.1% in the prior year’s comparable quarter.
Actuant's sales in the Engineered Solutions segment advanced 12% to $124.9 million in Q3 FY18 compared to $111.4 million in Q3 FY17. Excluding the benefit of the weaker US dollar of 5%, the segment's core sales increased 7% y-o-y. The segment's adjusted operating profit margin was 7.2% in the reported quarter compared to 7.3% in the year ago corresponding period, as the higher volumes were offset by higher engineering expenses to support growth, material and labor inflation, and an unfavorable mix.
As of May 31, 2018, Actuant's net debt was approximately $351 million (total debt of $540 million less $189 million of cash), which declined approximately $43 million from the prior quarter. The Company's cash provided by operating activities was $57.7 million versus $37.4 million in the year earlier comparable quarter.
For the full fiscal year 2018, Actuant raised its sales guidance and narrowed its adjusted earnings forecasts. For Q4 FY18, Actuant is forecasting sales to be in the range of $290 million to $300 million, reflecting normal seasonal moderation from Q3 FY18. The Company's adjusted EPS are expected to be in the band of $0.32 - $0.37 for the upcoming quarter.
For FY18, Actuant is projecting sales to be in the range of $1.17 billion - $1.18 billion, and adjusted EPS to be in the band of $1.03 - $1.08. The Company's free cash flow is expected to be in the range of $70 million - $75 million for FY18, and would represent a greater than 100% earnings conversion.
Stock Performance Snapshot
July 10, 2018 - At Tuesday's closing bell, Actuant's stock fell 1.03%, ending the trading session at $28.80.
Volume traded for the day: 830.09 thousand shares, which was above the 3-month average volume of 513.84 thousand shares.
Stock performance in the last month - up 13.39%; previous three-month period - up 24.14%; past twelve-month period - up 16.60%; and year-to-date - up 13.83%
After yesterday's close, Actuant's market cap was at $1.74 billion.
The stock has a dividend yield of 0.14%.
The stock is part of the Industrial Goods sector, categorized under the Diversified Machinery industry. This sector was up 0.4% at the end of the session.
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