AZZ's Q2 Earnings Beat, Sales Jump Y/Y, EPS View Raised

AZZ Inc. AZZ reported earnings per share of 76 cents in second-quarter fiscal 2022 (ended Aug 31, 2021). The bottom line surpassed the Zacks Consensus Estimate of 65 cents by 16.9%.

Total Revenues

In the quarter, the company reported revenues of $216.5 million, which missed the Zacks Consensus Estimate of $221 million by 2%.

Driven by strength in its reportable segments, the top line increased 6.4% from $216.5 million in the prior-year quarter. Revenues from Energy and Metal Coatings segments increased 0.6% and 10.7%, respectively, year over year.

AZZ Inc. Price, Consensus and EPS Surprise

AZZ Inc. Price, Consensus and EPS SurpriseAZZ Inc. Price, Consensus and EPS Surprise
AZZ Inc. Price, Consensus and EPS Surprise

AZZ Inc. price-consensus-eps-surprise-chart | AZZ Inc. Quote

Backlog & Bookings

Bookings in second-quarter fiscal 2022 increased to $231.8 million from $208.6 million a year ago. AZZ’s book-to-sales ratio was 1.07 compared with 1.03 in the year-ago period.

At the end of the fiscal second quarter, its total backlog was $201.5 million, down 4.3% from the year-ago period. The decrease in backlog is largely attributable to the completion of large orders in China. However, sequentially backlog was up $15.4 million, or 8.3%.

Quarterly Highlights

Total operating income in the quarter increased substantially to $26.5 million from the year-ago figure of $0.7 million.

Selling, general and administrative expenses were $28.6 million, increasing 6.7% from $26.8 million in the prior-year quarter.

Interest expenses decreased 28% to $1.8 million from $2.5 million.

During the quarter, the company repurchased shares worth $15 million. Year to date, AZZ has repurchased 416,279 shares of common stock, totaling $21.2 million.

Financial Highlights

Current Assets as of Aug 31, 2021, amounted to $329.1 million compared with $303.5 million as of Feb 28, 2021.

Long-term debt (net) was $182.4 million as of Aug 31, 2021, compared with $178.4 million on Feb 28, 2021.

Net cash from operating activities during the first half of fiscal 2022 was $37.8 million compared with $32.2 million in the first half of fiscal 2021.

Guidance

The company revised its fiscal 2022 EPS guidance to the range of $2.90-$3.20 per share from prior expectation of $2.65-$3.05. It expects sales in the range of $865 million to $925 million compared with prior expectation of $855 million to $935 million.

Zacks Rank

AZZ currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Manufacturing Electronics Releases

Eaton Corp. ETN is expected to release third-quarter 2021 results on Nov 2. The Zacks Consensus Estimate for the quarter is pegged at $1.74.

A. O. Smith Corp. AOS is going to release third-quarter 2021 results on Oct 28. The Zacks Consensus Estimate for the quarter to be reported is pegged at 67 cents.

Enersys ENS is expected to release second-quarter fiscal 2022 results on Nov 10. The Zacks Consensus Estimate for the quarter is pegged at $1.06.

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By Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

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