Apogee Enterprises Inc(NASDAQ: APOG) stock lost over 16.4% on December 21st, 2017 (as of 10:15AM EST; Source: Google finance) as the group has cut their FY18 outlook. Lower than forecasted volume and pricing, especially in architectural glass, coupled with rising health care costs hurt their performance. Delays regarding the Florida hurricane are moving $8 to $10 million in revenues. The group now forecasts a Revenue growth of over 20%, against their earlier forecasts of 24 to 26 percent growth. The group is expecting to incur over $4.5 million for these restructuring projects, which would yield over $4 million in annual savings in fiscal 2019 and beyond. On the other hand, for fiscal 2019, the group expects a double-digit revenue growth and triple-digit basis-point improvement in operating margin.
As per the segment performance for the third quarter of 2018, the group’s Architectural Framing Systems Revenues enhanced 114% yoy to $194.2 million but Revenues rose 17 percent excluding Sotawall, that was acquired in the fiscal 2017 fourth quarter, as well as EFCO, acquired in the fiscal 2018 second quarter. The Operating income surged 56% yoy to $18.5 million, while adjusted operating income rose 81% yoy to $21.4 million. Architectural Framing Systems Segment backlog fell to $448.8 million, against $495.9 million in the fiscal 2018 second quarter and $164.1 million in the prior-year period.
For Architectural Glass, the Revenues fell 9% yoy to $96.9 million hurt by the Florida hurricane and a lower volume of large projects. Operating income for the segment lost 22% yoy to $9.1 million, while Operating margin fell to 9.4 percent, against 10.9 percent, on the back of lower volume, pricing and mix, somewhat offset by improved productivity and costs.
Architectural Services Revenues lost 24% yoy to $49.1 million while Operating income fell 48% yoy to $2.5 million. The Operating margin for the segment fell to 5.2 percent, against 7.6 percent, on the back of falling volume leverage on project management, engineering and manufacturing capacity. However, the Segment backlog reached $346.3 million improving by more than $20 million from the fiscal 2018 second-quarter backlog of $323.0 million, and rising $150 million from the prior-year period backlog of $195.5 million.
APOG stock corrected over 9.4% in the last six months (as of December 20th, 2017; Source: Google finance).