Apogee Enterprises Inc. projected confidence with its 2023 outlook on Thursday following its first-quarter financial results report, which indicated growth in first-quarter revenue.
First-quarter revenue increased by more than 9% to $357 million, compared to $326 million in the first quarter of fiscal year 2022. The increase this year is led by improved profitability in architectural framing systems and architectural services, which saw a revenue increase of 19% and 14%, respectively.
The company also projects adjusted earnings around $3.50 to $3.90 per share. This is up from a previous range of $2.90 to $3.30 per share.
The growth comes despite the increase in the cost of aluminum, rising inflation and supply chain disruptions. Apogee Enterprises Inc. expects that these will remain issues throughout 2023.
“We continue to see significant cost pressure and volatility in aluminum, glass, energy and other categories,” Ty R. Silberhorn, CEO of Apogee Enterprises Inc., said. “Accordingly, we will continue to focus on cost management, productivity and pricing.”
Architectural Framing Systems
Architectural framing systems’ first-quarter revenue grew by 19% to $163 million. Operating income increased by 14.5% to $23.7 million, which are both records. This growth was primarily driven by improved pricing actions to offset inflation, restructuring actions and increased productivity, said Nisheet Gupta, executive vice president and chief financial officer.
Architectural Services revenue grew 14% to $103 million. This was driven by higher volume and executing projects in backlog. The operating margin was 2.8% compared to 4.7% this past year. This is a result of performance write-downs on a discrete number of projects, increased costs for investments to support future growth, and a less favorable project mix.
First-quarter revenue for the architectural glass segment was down by 8% with revenue at $76 million. According to Gupta, this was driven by lower volume and a strategy shift away from some lower-margin sales. The volume also continues to be impacted by lower project awards over the past 18 months.