Apogee Enterprises (NASDAQ:APOG) reported fourth-quarter financial results on Friday. The transcript from the company’s fourth-quarter earnings call has been provided below.
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Access the full call at https://edge.media-server.com/mmc/p/nep9ptwn/
Summary
Apogee Enterprises reported better-than-expected fourth-quarter results, with a 1.6% increase in net sales to $351.4 million, driven by favorable pricing in the metals segment.
The company successfully integrated UW Solutions into its Performance Services segment, achieving first-year financial targets of $100 million in revenue and an adjusted EBITDA margin of at least 20%.
Strategic initiatives include leveraging the Apogee management system to drive manufacturing improvements, actively managing the cost structure, and enhancing strategic pillars to position the company for growth.
Future guidance for fiscal 2027 anticipates net sales between $1.38 billion to $1.43 billion and adjusted diluted EPS of $2.70 to $3.25, reflecting a challenging macroeconomic environment.
Management highlighted the impact of aluminum cost increases and tariffs, with efforts to offset these through pricing actions and strategic cost management.
Full Transcript
OPERATOR
Good day and thank you for standing by. Welcome to Apogee Enterprises’ fourth quarter earnings Conference call. At this time, all participants are in a listen only mode. After the speaker’s presentation, there will be a question and answer session. To ask a question during the session, you press star 11 on your telephone. You will then hear an automated message advising your hand is raised to withdraw your question. Please press star 11 again. As a reminder, this conference is being recorded for replay purposes. I will now turn the conference over to Jeremy Stephan, Vice President, Investor Relations and Communications to begin. Jeremy, please go ahead.
Jeremy Stephan (Vice President, Investor Relations and Communications)
Thank you. Good morning and welcome to Apogee Enterprises fiscal 2026 fourth quarter earnings call. On call today are Don Nolan, Apogee’s Chief Executive Officer, and Mark Abdall, our Chief Financial Officer. During this call, the team will reference certain non-GAAP financial measures. Definitions of these measures and a reconciliation to the nearest GAAP measures are provided in the Earnings Release and Slide deck which are available in the Investor Relations section of our website. As a reminder, today’s call will contain forward looking statements. These reflect management’s expectations based on currently available information. Actual results may differ materially from those expressed today. More information about factors that could affect Apogee’s business and financial results can be found in our press release and in the company’s SEC filings. With that, I’ll turn the call over to Don.
Don Nolan (Chief Executive Officer)
Thanks Jeremy and good morning everyone. We’re glad you could join us for our fourth quarter earnings call. As I spent more time with the business over the past several months engaging with our teams, visiting our operations and working closely with our leadership group, I’ve gained a deeper appreciation for both the strengths of our portfolio and the discipline embedded in how we operate. While the market environment continues to evolve, we are focused on executing what is within our control, managing through near term pressures, and continuing to build a strong foundation for long term sustainable performance. I’m confident in the organization we have in place and the enhanced strategic direction we are taking as we move forward. With that said, I’m pleased to share that our results for the quarter were ahead of our expectations on both the top and bottom line, despite what continued to be a dynamic and challenging environment. I’d like to thank our team of dedicated and resilient employees for their focus on delivering exceptional products and services to all of our valuable customers. Fiscal 2026 was a year of disciplined execution for Apogee and as we navigated a difficult environment while continuing to strengthen our operating foundation, our teams delivered meaningful gains in safety, service and productivity and generated solid cash flow. I’d like to emphasize three areas that position us particularly well for the future. First, Performance Services successfully integrated UW Solutions into the segment. They delivered upon the first year financial targets for the acquisition of $100 million in revenue and adjusted EBITDA margin of at least 20%. The total segment delivered revenue of almost $200 million and an accretive margin for the company and we’re excited for the future given the expanded market, greater geographical reach along with the added substrate capability and coating technology. Second, the Apogee management system continues to drive meaningful improvements across our manufacturing footprint utilizing technology with embedded AI. Last fiscal year our Architectural Metals segment made significant progress improving outcomes for our Tube Light brand, completing a value stream redesign which resulted in improved service levels and lead times. We also reconfigured our linetech finishing facility in Wausau, Wisconsin, creating a tighter, more connected footprint that streamlined anodizing paint and packaging operations. This drove significant reductions in material movement, ultimately creating a leaner and safer environment. AMS has truly become a cornerstone of Apogee’s operating success, creating a safer work environment for our teams, delivering better quality service and reliability for our customers, and building a culture of continuous improvement that will drive even stronger outcomes in the years ahead. And third, we actively managed our cost structure and manufacturing footprint to mitigate portions of direct and indirect tariffs while driving efficiencies across the organization. These decisions were difficult and we certainly don’t take them lightly, but we are confident that the actions further position Apogee to successfully navigate the market headwinds we see today and expect in the near future. What we delivered in fiscal 2026 reflects more than just execution. It reflects the strength of a strategy that has guided Apogee through change and positioned us to lead. The strategy we put in place in 2021 continues to serve us well with a clear focus on becoming the economic leader in our target markets, actively managing our portfolio and strengthening our core capabilities and platforms. That focus has driven meaningful improvement across the business, including a more competitive cost structure through facility consolidation and organizational alignment, tighter supply chain integration and greater leverage of enterprise back office functions. At the same time, the Apogee management system delivered substantial gains in productivity and safety. We elevated pricing discipline and sharpened our portfolio, resulting in higher margins and increased profit dollars over the past five years. Moving forward, we are enhancing these strategic pillars to position Apogee as a more growth oriented, customer obsessed organization. Pillar number one is focused on accelerating leadership in target markets by differentiating through deep customer focus and insight, shaping what we offer and how we deliver it to be the economic leader in the markets we serve. The second pillar involves growing and strengthening the portfolio through organic and inorganic advancements and differentiated solutions that address evolving customer challenges and deliver lasting value. And the third pillar is all about advancing core capabilities by driving a culture of continuous improvement through operational excellence, talent development and technology that truly elevates a customer experience. Building on the progress we’ve made, we continue to identify areas for growth in non residential construction markets. We see opportunities to further …
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