Advanced Drainage Systems Inc (NYSE: WMS) stock rose over 10.8% on 29th May, 2018 (as of 12:01 PM GMT-4; Source: Google finance). The company had reported the adjusted revenue growth of 2.4 percent to $250.1 million in the fourth quarter of FY 18, beating the analysts’ estimates for revenue of $249.44 million. Overall, in the fourth quarter, WMS has delivered 73.1 percent rise in net income to $4.9 million.
Moreover, in the fourth quarter 2018, the domestic net sales grew 1.2% to $226.2 million due to the favorable pricing and strong allied product sales in the construction markets. The sales in the core domestic construction markets grew 500 basis points above the market. International net sales grew 15.1% to $23.9 million driven by growth in Canadian construction markets and export sales. The gross profit in the fourth quarter grew 22.6% to $48.1 million. Gross profit margin increased by 310 basis points to 19.2% compared to 16.1% in the prior year, primarily due to favorable pricing as well as lower manufacturing costs. Further, in the fourth quarter, adjusted EBITDA (Non-GAAP) grew 114.8% to $27.0 million, as compared to $12.6 million in the prior year quarter. As a percentage of net sales, Adjusted EBITDA enhanced 570 basis points to 10.8% as compared to 5.1% in the prior year. The increase in Adjusted EBITDA margin was primarily due to a decrease in selling, general and administrative expenses.
WMS has declared the quarterly cash dividend of $0.08 per share, which will be paid on June 15, 2018 to shareholders of record at the close of business on June 5, 2018.
Additionally, in FY 18, net cash provided by operating activities has increased 31.5% to $137.1 million, as compared to $104.2 million in FY 17. Free cash flow (Non-GAAP) has increased 65.8% to $94.5 million, as compared to $57.6 million in FY 17. Net debt (total debt and capital lease obligations net of cash) was $362.1 million as of March 31, 2018, a decrease of $60.2 million from March 31, 2017.
For FY 19, WMS expects net sales to be in the range of $1.375 billion to $1.425 billion and adjusted EBITDA is expected to be in the range of $220 to $240 million. Capital expenditures are expected to be in the range of $60 to $70 million.