AZZ Inc (NYSE:AZZ) stock rose 8.24% (As on October 11, 11:13:13 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the second quarter of FY 24. AZZ Metal Coatings’
sales increased year-over-year by 2.4% to a record $169.8 million, due to both higher volume and increased selling price.  EBITDA of $51.6 million or 30.4% of sales was slightly above our 25-30% targeted EBITDA range. AZZ Precoat Metals’ sales of $228.7 million decreased year-over-year by 5.0% due to lower volume in HVAC, transportation, and certain construction end markets.  Average selling price increased 7% as compared to the same quarter last year, driven by value-pricing initiatives, and a shift in sales mix.  The Company generated significant operating cash flow of $118.3 million in the first six months of the year through improved earnings and prudent working capital management.  At the end of the second quarter, net leverage was 3.4x TTM EBITDA.  During the second quarter, the Company paid down debt of $40.0 million and returned cash to shareholders through cash dividend payments totaling $7.9 million.  Capital expenditures were $25.7 million during the quarter, and fiscal year 2024 capital expenditures are expected to be approximately $125 million, which includes $70 million in cash outlays for AZZ’s new coil coating plant in Washington, Missouri.

AZZ in the second quarter of FY 24 has reported the adjusted earnings per share of $1.27, beating the analysts’ estimates for the adjusted earnings per share of $1.08. The company had reported 2 percent decline in the adjusted revenue of $398.50 million in the second quarter of FY 24, beating the analysts’ estimates for revenue of $396.91 million.

Additionally, the company has authorized a second quarter cash dividend in the amount of $0.17 per share on the Company’s outstanding shares of common stock. The dividend is payable on November 1, 2023, to shareholders of record as of the close of business on October 18, 2023.

AZZ expects full-year earnings in the range of $3.85 to $4.35 per share, Adjusted EBITDA of $300-$325 million with revenue to be in the range of $1.4 billion to $1.55 billion.

Meanwhile. the company’s new plant construction in Washington, Missouri continues to progress ahead of schedule and budget.  After careful consideration, AZZ has made the decision to internally fund the construction of the new plant in Washington, Missouri versus funding a portion of it through a sale/leaseback transaction.  As the company have stated previously, the project will not have an impact on AZZ’s debt leverage nor thw previously stated goal of 3.0x debt leverage by the end of FY2024