For the twelve months - Revenues Increase 29%, Net Income up 52%,
Earnings per Share Increased 52% and Backlog is up 30% FORT WORTH,
Texas, April 3 /PRNewswire-FirstCall/ -- AZZ incorporated
(NYSE:AZZ), a manufacturer of electrical products and a provider of
galvanizing services, today announced unaudited financial results
for the three and twelve-month periods ended February 28, 2009.
Revenues for the fourth quarter were $100.3 million, compared to
$76.6 million, an increase of 31 percent from the comparable period
last year. Net income rose 36 percent to $10 million, or $0.81 per
diluted share, compared to net income of $7.3 million or $0.60 per
diluted share, in last year's fiscal fourth quarter. Backlog at the
end of the fourth quarter was $174.8 million, compared to $195.2
million at the end of the previous quarter and $134.9 million for
the fourth quarter of last year. Incoming orders for the fourth
quarter totaled $79.9 million while shipments for the quarter
totaled $100.3 million, resulting in a book to ship ratio of 80
percent for the quarter. Incoming orders for the quarter increased
24 percent when compared to the fourth quarter of last year. Based
upon current customer requested delivery dates and our planned
production schedule, 94 percent of our backlog is expected to ship
in fiscal 2010. Of our $174.8 million backlog, 40 percent is to be
delivered outside of the U.S. For the fiscal year revenues
increased 29 percent to $412.4 million, compared to $320.2 million
for the prior year. Net income for the year was up 52 percent to
$42.2 million, or $3.43 per diluted share, compared to $27.7
million, or $2.26 per diluted share for the comparable twelve-month
period last year. Incoming orders for the twelve-month period were
$439.1 million, while fiscal year revenues totaled $412.4 million,
resulting in a book to ship ratio of 106 percent. Incoming orders
for the fiscal year of $439.1 million increased 31 percent when
compared to the prior fiscal year. Revenues for the Electrical and
Industrial Products Segment were $59.9 million for the fourth
quarter, compared to $41.7 million in the previous year's fourth
quarter, an increase of 44 percent. Operating income for this
segment increased 58 percent to $10.8 million, compared to $6.8
million in the fourth quarter of last year. Operating income
margins for the fourth quarter of 18 percent compare favorably to
the 16 percent in the prior year. For the fiscal year ended
February 28, 2009 revenues increased 26 percent to $225.8 million
and operating income rose 34 percent to $39.0 million, which
compared favorably to the $179.2 million and $29.2 million,
respectively, in the prior fiscal year. Operating income margins
for the fiscal year improved to 17 percent from the 16 percent in
the prior fiscal year. David H. Dingus, president and chief
executive officer, commented, "We are very pleased with the growth
and expansion of the Electrical and Industrial Products Segment for
fiscal 2009. The full year results reflected improvement in every
operating measurement. As we go forward, we continue to monitor
closely our market opportunities and our operating structure due to
the changing and challenging market conditions. Recently, incoming
orders have been slower than desired due to increased customer
deliberation on the release of new orders pertaining to projects
that are in process as well as those that are in the planning
phase. This combined with increased competitive pressure,
particularly on large international quotations, has had an adverse
impact on our incoming order rate. Our book to ship ratio for the
quarter was essentially the same as it has been in the fourth
quarter, three of the past four years. The fourth quarter continued
to be a difficult quarter for us in terms of incoming orders.
However, different than in prior years, we do not anticipate that
our backlog will increase in the second quarter or recover to the
record setting level of the third quarter of fiscal 2009 until we
see improvement in our markets. We remain optimistic that we will
see some leveling of our backlog after the second quarter and a
modest recovery as we enter our fiscal 2011. Margins were very
strong in the fourth quarter and fiscal year due to pricing
discipline, improved project management, and assisted by favorable
cost of key commodities. Our challenge is to continue to succeed in
our efforts to expand our served markets and product offerings,
while maintaining our strong operating performance and management
of our cost/price ratios consistent with our historical practices."
Revenues for the Company's Galvanizing Service Segment were $40.4
million for the fourth quarter, compared to $34.9 million in the
previous year's comparable quarter, an increase of 16 percent.
Operating income was up 26 percent to $11.2 million in the fourth
quarter as compared to $8.9 million in the same quarter last year.
Operating income margins for the fourth quarter were 28 percent
versus 26 percent in same period last year. For the fiscal year,
revenues increased 32 percent to $186.6 million, and operating
income rose 52 percent to $53.2 million compared to $141.0 million
and $35.1 million, respectively, for the prior fiscal year.
Operating margins were 29 percent for the fiscal year compared to
25 percent in the prior fiscal year. Mr. Dingus continued,
"Shipments for the fiscal year increased 37 percent, with 86
percent of the increase attributable to an acquisition made during
fiscal 2009. For the full fiscal year pricing was down 2 percent.
Demand for galvanizing services in the fourth quarter varied across
our served markets. Our infrastructure work related to electrical
and telecommunications, as well as the petrochemical remained at a
strong pace, while other markets did see deterioration due the
domestic economic conditions. Margins were extremely strong for
both the fourth quarter and fiscal year. We have seen additional
pricing deterioration since the first of calendar 2009 and do
believe that fiscal 2010 will reflect a continuation of these
conditions. Fortunately our cost structure is benefiting from lower
commodity cost partially offsetting the adverse impact of price
adjustments. The effective execution of our business strategies,
capitalizing on our market opportunities, and meeting or exceeding
our margin projections has very positively contributed to our
fiscal 2009 success. We anticipate that we will be able to retain
our strong market leadership position in the new fiscal year. "The
strength of our balance sheet, strong cash position, combined with
access to borrowings under our existing banking agreements, should
facilitate the execution of our business strategies." Mr. Dingus
concluded, "On January 16, 2009, the company issued projections for
Fiscal 2010 that revenues would be in the range of $420 to $440
million and that fully diluted earnings per share would be in the
range of $2.75 to $2.95. Based upon the evaluation of information
currently available to management, we are revising our guidance for
revenues to be in the range of $395 to $415 million. Our earnings
guidance remains unchanged from that previously issued. We continue
to strive to build upon the success we have been able to achieve,
and continually strive to maximize the performance of the Company.
Our estimates assume that we will not have any appreciable change
in our current market conditions, significant delays in the
delivery or timing in the receipt of orders of our electrical and
industrial products, and that the pricing and demand for our
galvanizing services will not significantly change from our current
outlook in fiscal 2010." AZZ incorporated will conduct a conference
call to discuss financial results for the fourth quarter and fiscal
2009, and the outlook for fiscal year 2010 at 11:00 A.M. Eastern on
Friday April 3, 2009. Interested parties can access the call at
(877) 356-5706 or (706) 643-0580 (international). The call will be
web cast via the Internet at http://www.azz.com/AZZinvest.htm. A
replay of the call will be available for three days at (800)
642-1687, or (706) 645-9291 (international) confirmation #91136736,
or for 30 days at http://www.azz.com/AZZinvest.htm. AZZ
incorporated is a specialty electrical equipment manufacturer
serving the global markets of industrial, power generation,
transmission and distribution, as well as a leading provider of hot
dip galvanizing services to the steel fabrication market
nationwide. Except for the statements of historical fact, this
release may contain forward-looking statements that involve risks
and uncertainties some of which are detailed from time to time in
documents filed by the Company with the SEC. Those risks and
uncertainties include, but are not limited to: changes in customer
demand and response to products and services offered by the
company, including demand by the electrical power generation
markets, electrical transmission and distribution markets, the
industrial markets, and the hot dip galvanizing markets; prices and
raw material costs, including zinc and natural gas which are used
in the hot dip galvanizing process; changes in the economic
conditions of the various markets the Company serves, foreign and
domestic, customer requested delays of shipments, acquisition
opportunities, currency exchange rates, adequacy of financing, and
availability of experienced management employees to implement the
Company's growth strategy. The Company can give no assurance that
such forward-looking statements will prove to be correct. We
undertake no obligation to affirm, publicly update or revise any
forward-looking statements, whether as a result of information,
future events or otherwise. Contact: Dana Perry, Senior Vice
President - Finance and CFO AZZ incorporated 817-810-0095 Internet:
http://www.azz.com/ Lytham Partners 602-889-9700 Joe Dorame or
Robert Blum Internet: http://www.lythampartners.com/ Condensed
financial tables on attached page AZZ incorporated Condensed
Consolidated Statement of Income (in thousands except per share
amounts) Three Months Ended Twelve Months Ended February February
February February 28, 2009 29, 2008 28, 2009 29, 2008 (unaudited)
(unaudited) (unaudited) (unaudited) =========== ===========
=========== =========== Net sales $100,286 $76,617 $412,364
$320,193 Costs and Expenses: Cost of Sales 72,167 56,708 299,012
239,651 Selling, General and Administrative 10,676 8,445 43,221
36,261 Interest Expense 1,685 233 6,170 1,495 Net (Gain) Loss on
Sales or Insurance Settlement of Property, Plant and Equipment
(373) 84 (1,509) 32 Other (Income) (61) (305) (1,440) (1,079)
$84,094 $65,165 $345,454 $276,360 Income before income taxes and
accounting change $16,192 $11,452 $66,910 $43,833 Income Tax
Expense 6,225 4,124 24,704 16,145 Income Before Cumulative Effect
of Changes in Accounting Principles 9,967 7,328 42,206 27,688
Cumulative Effect of Changes in Accounting Principles (Net of Tax)
- - - - Net income $9,967 $7,328 $42,206 $27,688 Net income per
share Basic $.82 $.60 $3.48 $2.30 Diluted $.81 $.60 $3.43 $2.26
Diluted Average Shares Outstanding 12,279 12,313 12,302 12,227
Segment Reporting (in thousands) Three Months Ended Twelve Months
Ended February February February February 28, 2009 29, 2008 28,
2009 29, 2008 (unaudited) (unaudited) (unaudited) (unaudited)
=========== =========== =========== =========== Net Sales:
Electrical and Industrial Products $59,872 $41,702 $225,797
$179,181 Galvanizing Services 40,414 34,914 186,567 141,012
$100,286 $76,616 $412,364 $320,193 Segment Operating Income(a):
Electrical and Industrial Products $10,811 $6,840 $38,951 $29,158
Galvanizing Services 11,223 8,909 53,184 35,087 Total Segment
Operating Income $22,034 $15,749 $92,135 $64,245 Condensed
Consolidated Balance Sheet (in thousands) February 28, 2009
February 29, 2008 (unaudited) (unaudited) =========== ===========
Assets: Current assets $182,023 $102,995 Net property, plant and
equipment 87,667 48,285 Other assets, net 85,025 42,039 ------
------ Total assets $354,715 $193,319 ======== ======== Liabilities
and shareholders' equity: Current liabilities $58,371 $42,696 Long
term debt due after one year 100,000 - Other liabilities 9,232
4,467 Shareholders' equity $187,112 $146,156 -------- --------
Total liabilities and shareholders' equity $354,715 $193,319
======== ======== Condensed Consolidated Statement of Cash Flows
(in thousands) Twelve Months Ended February 28, February 29, 2009
2008 (unaudited) (unaudited) =========== =========== Net cash
provided by (used in) operating activities $60,196 $38,926 Net cash
provided by (used in) investing activities ($112,811) ($9,706) Net
cash provided by (used in) financing activities $98,104 ($28,696)
Effect of exchange rate changes on cash ($158) - ------ --- Net
increase (decrease) in cash and cash equivalents $45,331 $524 Cash
and cash equivalents at beginning of period $2,227 $1,703 ------
------ Cash and cash equivalents at end of period $47,558 $2,227
======== ========= DATASOURCE: AZZ incorporated CONTACT: Dana
Perry, Senior Vice President - Finance and CFO of AZZ incorporated,
+1-817-810-0095; or Joe Dorame or Robert Blum of Lytham Partners,
+1-602-889-9700, for AZZ incorporated Web Site: http://www.azz.com/
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