Apogee Reports Drop in Q1 2021 Results Due to COVID-19 Effects

Apogee Enterprises reports its first quarter 2021 financial results were down compared to Q1 2020 due to effects of the COVID-19 pandemic. The company’s net sales dropped 19%, from $355 million to $289 million year-over-year. Apogee’s gross profit dropped from $81 million in Q1 2020 to $60 million in Q1 2021, a -26% change. Operating income was $6.5 million this quarter compared to $23 million in Q1 2020, a 72% drop.

“We navigated our way through a very challenging quarter, with several significant COVID-19 related headwinds across our business,” said Joseph F. Puishys, chief executive officer. “Most notably, the large-scale optical segment had a near-complete shutdown of its customers for most of the quarter. Our three architectural segments continued to operate as essential businesses, but saw several projects temporarily halted or delayed. We also had large numbers of COVID-related absences in our workforce, particularly in the architectural glass segment, and added costs as we adapted our operations to promote a healthy workplace environment for our employees. Despite these headwinds, we were able to effectively manage our capacity and costs to deliver positive earnings and strong cash flow.

“Following the end of the first quarter, we are beginning to see signs of improvement in our end markets and the economy and we remain optimistic that our results in the coming quarters will be stronger than the first quarter. Our large-scale optical customers have begun to gradually reopen,” Puishys added. “In our architectural segments, we expect project delays and workforce absences to moderate and our strong backlog provides good visibility in the longer lead-time parts of our business. Additionally, we should see increased benefit from our cost reduction actions as we enter the second quarter. Given the uncertainty in our end markets and the economy, at this time we are not providing guidance for fiscal 2021, but will strive to offer more details as the economic situation stabilizes.”

Architectural Framing

Apogee’s architectural framing systems segment, which includes Alumicor, EFCO Corp., Linetec, Sotawall, Tubelite and Wausau Window and Wall Systems, was $150.2 million, compared to $180.5 million in the prior year period. Segment backlog stands at $423 million, compared to $432 million a quarter ago.

Architectural Glass

First-quarter revenue for the architectural glass segment, which includes Viracon, was $76.9 million, compared to $100.3 million in the prior year quarter.

Architectural Services

Revenue for the architectural services segment, which includes Harmon was $63.6 million in the first quarter, compared to $65.1 million in the prior-year quarter. Architectural services continued to have strong order flow during the quarter, with segment backlog increasing to a record $685 million, up from $660 million last quarter, and up more than 40% from $483 million a year ago.

Large-Scale Optical

Revenue for the large-scale optical segment, which includes Tru Vue, was $6.3 million, down from $21.3 million in the first quarter last year, as most of the segment’s customers were closed for a large part of the quarter to comply with various state and local government directives. In response to the lower demand, and to comply with state government directives, the segment closed its  two primary manufacturing locations for most of the first quarter. These facilities are expected to resume operations late in the second quarter, as customers reopen.

Members of GIMAV, the Italian Association of Manufacturers and Suppliers of Machinery, Systems, Accessories and Special Products for glass processing, saw a 2.7% increase in sales in 2019, driven by a 3.7% rise in exports. It achieved overall sales of more than $2.6 billion.

Domestic sales by Italian manufacturers were stable and, despite sluggish demand (-0.4%), Italian products still fared better than imports (-1.2%). Growth in exports and, at the same time, a decrease in imports worked in favor of the sector’s trade balance (+5.4%) which, at $1.44 billion, accounts for nearly 55% of sales.

“This means that for every Euro invested in the sector, we contribute 55 cents to our country’s positive trade balance,” says Michele Gusti, GIMAV’s president. “Those who determine our country’s economic and industrial policies would do well to take this outstanding performance into account by rewarding it more.”

The sector’s competitiveness indicators are extremely positive, and both on the upswing – with a 72.2% export share of sales and 61.3% dominance of the domestic market—giving it an ample margin in the area that sets Italy’s excellences apart, according to the organization.

Flat glass processing technologies fell 1.3% compared to 2018, due to small losses in exports (-0.5%) and more marked losses (-3.2%) in domestic sales. However, sector imports, down 4.4%, were even more affected by the slowdown in domestic sales (-3.3%).

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