FORT WORTH, Texas – AZZ Inc . (NYSE: NYSE:), a prominent player in hot-dip galvanizing and coil coating solutions, reported a robust first quarter with earnings surpassing analyst expectations. The company announced an adjusted EPS of $1.46 for the quarter, which was $0.16 higher than the analyst estimate of $1.30. Revenue for the quarter also exceeded expectations, coming in at $413.2 million against the consensus estimate of $402.42 million.

Despite the positive earnings report, the company’s stock dipped slightly by 0.6% as the future guidance provided by management fell short of analyst consensus. For the fiscal year 2025, AZZ Inc. anticipates an adjusted EPS range of $4.50 to $5.00, while analysts had estimated an average of $4.88. Similarly, the company’s revenue guidance for the year is projected to be between $1.525 billion and $1.625 billion, with the midpoint below the consensus estimate of $1.6 billion.

Tom Ferguson, President and CEO of AZZ, expressed satisfaction with the company’s first-quarter performance, highlighting a 5.7% increase in sales compared to the previous year. The Metal Coatings and Precoat Metals segments reported organic sales growth of 4.7% and 6.5%, respectively. The company’s consolidated EBITDA margin grew to 22.8%, attributed to increased volume and zinc productivity improvements over the prior year. AZZ’s Metal Coatings segment, in particular, benefited from continued demand in various end markets, including construction and renewables, achieving an EBITDA margin of 30.9%.

The strong operating cash flow of $71.9 million enabled AZZ to strengthen its balance sheet further. The company completed a secondary public offering of common stock and fully redeemed its Series A Preferred Stock. Additionally, AZZ reduced its debt by $25 million during the quarter, aligning with its fiscal year target of $60 to $90 million.

Ferguson remained optimistic about the company’s sales prospects, citing the secular tailwinds for non-building construction related to infrastructure and renewable projects, the reshoring of manufacturing, and the shift towards environmentally friendly pre-painted steel and aluminum.

The company’s financial health was also bolstered by a secondary public offering of common stock, which, along with the redemption of the Series A Preferred Stock, contributed to a net leverage ratio of 2.8x. Capital expenditures for the quarter were approximately $27.4 million, with full fiscal year capital expenditures expected to be in the range of $100 to $120 million.

Investors and analysts will be closely monitoring AZZ’s progress as it navigates the balance between its strong current performance and the cautious outlook for the coming fiscal year.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.



Read the full article here

Share.
Leave A Reply

© 2024 Brilliance Financials. All Rights Reserved.