NEW YORK AZZ Inc. remains confident that its finances will grow to record highs by its fiscal third quarter of 2014 despite reporting a 9 percent decline year on year in the fiscal first quarter.
The Fort Worth, Texas-based galvanizer and electronics maker reported net income of almost $14.6 million, or 57 cents per diluted share, for the quarter ended May 31, compared with a net income of nearly $16 million, or 63 cents per share, a year ago.
In a conference call on June 28, the company said the decrease was due to recurring losses from a fire at the companys hot-dip galvanizing facility in Joliet, Ill. (amm.com , April. 30, 2012
), a backlog in the electrical and industrial products and services segment, and the acquisition of industrial maintenance company Aquilex Specialty Repair and Overhaul, LLC last April (amm.com, April 1
Despite this, the company maintains its high estimate for earnings and revenues for year-end 2014.
Due to the significant impact of recent acquisitions and seasonal trends associated with (acquisitions of nuclear industry equipment company Nuclear Logistics Inc.) and Aquilex, we expect our strongest operating results to be in the third quarter, record-setting both in revenue and earnings, David Dingus, president and chief operating officer, said during the call. Dingus also announced he will retire effective March 1, 2014, for health reasons.
Dingus said the company could make another acquisition in the next year in either the galvanizing segment or electronic segment. The company estimates year-end revenues of $825 million to $900 million, with diluted earnings per share of $2.65 to $2.95, compared to revenues of $570.6 million and diluted earnings per share of $2.37 recorded for year-end 2013.
AZZs galvanizing department, despite taking a hit in production from the Joliet fire, has seen modest gains in production while its solar projects division leveled off, said Tim Pendley, chief financial officer of the galvanizing service segment.
Were well-positioned for the prime season and remain optimistic to see a pick up in production, he said. The Joliet facility is now in full construction mode and we look forward to its completion. The galvanizing segment saw revenues of $86.7 million in the first quarter 2014, compared to $82.5 million first quarter 2013. Some of this revenue is from $3.4 million received from a $4.2 million settlement awarded during the lawsuit after the Joliet fire, according to company data.