Astec Reports Third Quarter 2024 Results
Astec Industries (ASTE) reported mixed Q3 2024 results with net sales of $291.4 million, down 3.9% year-over-year. The company posted a net loss of $6.2 million, including an $8.4 million charge for legacy litigation settlement. Infrastructure Solutions showed strength with increased sales and margins, while Materials Solutions faced challenging market conditions. Adjusted EBITDA improved to $17.4 million, up $7.4 million from previous year. The company's backlog stood at $475.8 million, down 22.6%. Free cash flow was $19.9 million, with total liquidity of $195.1 million.
Astec Industries (ASTE) ha riportato risultati misti per il terzo trimestre del 2024, con vendite nette di $291,4 milioni, in calo del 3,9% rispetto all'anno precedente. L'azienda ha registrato una perdita netta di $6,2 milioni, inclusa una spesa di $8,4 milioni per un accordo legale legato a contenziosi passati. Infrastructure Solutions ha mostrato punti di forza con vendite e margini in crescita, mentre Materials Solutions ha affrontato condizioni di mercato difficili. L'EBITDA rettificato è migliorato a $17,4 milioni, con un aumento di $7,4 milioni rispetto all'anno precedente. L'ordine accumulato dell'azienda si attesta a $475,8 milioni, in calo del 22,6%. Il flusso di cassa libero è stato di $19,9 milioni, con una liquidità totale di $195,1 milioni.
Astec Industries (ASTE) reportó resultados mixtos para el tercer trimestre de 2024, con ventas netas de $291,4 millones, una disminución del 3,9% en comparación con el año anterior. La empresa registró una pérdida neta de $6,2 millones, incluyendo un cargo de $8,4 millones por un acuerdo de litigios antiguos. Infrastructure Solutions mostró fortaleza con ventas y márgenes en aumento, mientras que Materials Solutions enfrentó condiciones de mercado desafiantes. El EBITDA ajustado mejoró a $17,4 millones, un incremento de $7,4 millones respecto al año anterior. La cartera de pedidos de la empresa se situó en $475,8 millones, con una disminución del 22,6%. El flujo de caja libre fue de $19,9 millones, con una liquidez total de $195,1 millones.
Astec Industries (ASTE)는 2024년 3분기 혼합된 실적을 보고했으며, 순매출액은 $291.4 백만으로 지난해 대비 3.9% 감소하였습니다. 이 회사는 620만 달러의 순손실을 기록하였으며, 여기에 과거 소송 합의금으로 840만 달러의 비용이 포함되어 있습니다. Infrastructure Solutions은 판매와 마진이 증가하여 강세를 보였으나, Materials Solutions는 어려운 시장 조건에 직면하였습니다. 조정된 EBITDA는 1740만 달러로, 지난해보다 740만 달러 증가하였습니다. 회사의 수주 잔고는 475.8 백만 달러로, 22.6% 하락하였습니다. 자유현금흐름은 1990만 달러, 총 유동성은 1951만 달러입니다.
Astec Industries (ASTE) a publié des résultats mitigés pour le troisième trimestre 2024, avec un chiffre d'affaires net de 291,4 millions de dollars, en baisse de 3,9 % par rapport à l'année dernière. La société a enregistré une perte nette de 6,2 millions de dollars, y compris une charge de 8,4 millions de dollars pour un règlement de litige ancien. Infrastructure Solutions a montré de la force avec une augmentation des ventes et des marges, tandis que Materials Solutions a rencontré des conditions de marché difficiles. L'EBITDA ajusté a augmenté à 17,4 millions de dollars, en hausse de 7,4 millions de dollars par rapport à l'année précédente. Le carnet de commandes de l'entreprise s'élevait à 475,8 millions de dollars, en baisse de 22,6 %. Le flux de trésorerie libre était de 19,9 millions de dollars, avec une liquidité totale de 195,1 millions de dollars.
Astec Industries (ASTE) berichtete über gemischte Ergebnisse für das dritte Quartal 2024 mit Nettoumsätzen von 291,4 Millionen Dollar, was einem Rückgang von 3,9% im Vergleich zum Vorjahr entspricht. Das Unternehmen verzeichnete einen Nettoverlust von 6,2 Millionen Dollar, einschließlich einer Belastung von 8,4 Millionen Dollar aufgrund eines Vergleichs in Erbschaftsrechtsstreitigkeiten. Infrastructure Solutions zeigte Stärke mit steigenden Verkaufszahlen und Margen, während Materials Solutions sich schwierigen Marktbedingungen gegenübersah. Das bereinigte EBITDA verbesserte sich auf 17,4 Millionen Dollar, was einem Anstieg von 7,4 Millionen Dollar im Vergleich zum Vorjahr entspricht. Der Auftragsbestand des Unternehmens betrug 475,8 Millionen Dollar, ein Rückgang um 22,6 %. Der freie Cashflow betrug 19,9 Millionen Dollar, mit einer GesamtlLiquidität von 195,1 Millionen Dollar.
- Adjusted EBITDA increased 74% to $17.4 million
- Infrastructure Solutions segment showed improved performance with higher margins
- Free cash flow of $19.9 million
- International sales increased 9.1%
- Strong liquidity position of $195.1 million
- Net sales decreased 3.9% to $291.4 million
- Net loss of $6.2 million
- Total backlog declined 22.6% to $475.8 million
- Materials Solutions segment sales decreased 9.6%
- $8.4 million charge for legacy litigation settlement
Insights
Astec's Q3 results show mixed performance with concerning trends.
The Infrastructure Solutions segment remains resilient with stable sales and improved margins, while Materials Solutions faces headwinds from financing constraints affecting equipment sales. The
Third Quarter 2024 Overview (all comparisons are made to the corresponding prior year third quarter unless otherwise specified):
- Net sales of
$291.4 million decreased3.9% - Net loss of
$6.2 million , which included an$8.4 million charge related to the settlement of a legacy litigation matter: Adjusted net income of$7.0 million - EBITDA of
$0.6 million declined$1.2 million ; Adjusted EBITDA was$17.4 million , an increase of$7.4 million - Diluted EPS of
$(0.27) compared to$(0.29) ; Adjusted EPS of$0.31 compared to$(0.01) - Operating cash flow of
$22.5 million ; Free cash flow of$19.9 million
CHATTANOOGA, Tenn., Nov. 06, 2024 (GLOBE NEWSWIRE) -- Astec Industries, Inc. (Nasdaq: ASTE) announced today its financial results for the third quarter ended September 30, 2024.
"In the third quarter, we had mixed results. In Infrastructure Solutions, both sales and margins were up for the quarter, while in Materials Solutions, we continued to face difficult market conditions. We made nice progress improving our cash flow in the third quarter, which continues to be a key focal point. We were also able to settle one of our previously disclosed, long-standing, legacy litigation matters related to a product we no longer own, which resulted in an
Mr. van der Merwe continued, "With sound fundamentals in place, we continue to focus on commercial and operational excellence. We have a customer-focused approach and product offerings to drive sustainable value creation for our shareholders."
| GAAP | Adjusted | ||||||||||||||||||
| (in millions, except per share and percentage data) | 3Q 2024 | 3Q 2023 | Change | 3Q 2024 | 3Q 2023 | Change | |||||||||||||
| Net sales | $ | 291.4 | $ | 303.1 | (3.9 | )% | |||||||||||||
| Domestic sales | 211.2 | 229.6 | (8.0 | )% | |||||||||||||||
| International sales | 80.2 | 73.5 | 9.1 | % | |||||||||||||||
| Backlog | 475.8 | 614.7 | (22.6 | )% | |||||||||||||||
| Domestic backlog | 377.6 | 510.6 | (26.0 | )% | |||||||||||||||
| International backlog | 98.2 | 104.1 | (5.7 | )% | |||||||||||||||
| (Loss) income from operations | (7.2 | ) | (5.2 | ) | (38.5 | )% | 9.9 | 3.1 | 219.4 | % | |||||||||
| Operating margin | (2.5 | )% | (1.7 | )% | (80) bps | 3.4 | % | 1.0 | % | 240 bps | |||||||||
| Effective tax rate | 27.1 | % | 8.5 | % | 1,860 bps | 18.6 | % | 108.3 | % | (8,970) bps | |||||||||
| Net (loss) income attributable to controlling interest | (6.2 | ) | (6.6 | ) | 6.1 | % | 7.0 | (0.2 | ) | 3600.0 | % | ||||||||
| Diluted EPS | (0.27 | ) | (0.29 | ) | 6.9 | % | 0.31 | (0.01 | ) | 3200.0 | % | ||||||||
| EBITDA (a non-GAAP measure) | 0.6 | 1.8 | (66.7 | )% | 17.4 | 10.0 | 74.0 | % | |||||||||||
| EBITDA margin (a non-GAAP measure) | 0.2 | % | 0.6 | % | (40) bps | 6.0 | % | 3.3 | % | 270 bps | |||||||||
Segments Results
Our two reportable segments are comprised of sites based upon the nature of the products or services produced, the type of customer for the products, the similarity of economic characteristics, the manner in which management reviews results and the nature of the production process, among other considerations. Based on a review of these factors, our Australia and LatAm sites, which were previously reported in the Infrastructure Solutions segment have moved to the Materials Solutions segment and Astec Digital, which was previously included in the Corporate and Other category has moved to the Infrastructure Solutions segment, each beginning January 1, 2024. Prior periods have been revised to reflect the changes for the segment composition for comparability.
Infrastructure Solutions - Road building equipment, asphalt and concrete plants, thermal storage solutions and related aftermarket parts.
- Net sales of
$165.0 million increased slightly as the infrastructure construction market remains strong with healthy demand for asphalt and concrete plant deliveries anticipated through the beginning of 2025. - Segment Operating Adjusted EBITDA of
$15.6 million increased17.3% and Segment Operating Adjusted EBITDA margin of9.5% increased 140 basis points. - Backlog was
$351.1 million .
Materials Solutions - Processing equipment to crush, screen and convey aggregates and related aftermarket parts.
- Net sales of
$126.4 million decreased by9.6% primarily due to lower equipment sales attributable to finance capacity constraints with contractors and dealers resulting in fewer product conversions. Dealer quoting remains active. - Segment Operating Adjusted EBITDA of
$14.5 million increased52.6% and Segment Operating Adjusted EBITDA margin of11.5% increased 470 basis points, due to a$6.4 million legal charge in the prior year third quarter, continued efforts towards cost reduction and sharing facility capacity with the Infrastructure Solutions segment. - Backlog was
$124.7 million .
Balance Sheet, Cash Flow and Liquidity
- Our total liquidity was
$195.1 million , consisting of$52.7 million of cash and cash equivalents available for operating purposes and$142.4 million available for additional borrowings under our revolving credit facility. - Free Cash Flow in the quarter was
$19.9 million after incurring capital expenditures of$2.6 million .
Third Quarter Capital Allocation
- Dividend payment of
$0.13 per share.
Investor Conference Call and Webcast
Astec will conduct a conference call and live webcast today, November 6, 2024, at 8:30 A.M. Eastern Time, to review its third quarter financial results as well as current business conditions.
To access the call, dial (888) 440-4118 on Wednesday, November 6, 2024 at least 10 minutes prior to the scheduled time for the call. International callers should dial (646) 960-0833.
You may also access a live webcast of the call at: https://events.q4inc.com/attendee/885477721
You will need to give your name and company affiliation and reference Astec. An archived webcast will be available for ninety days at www.astecindustries.com.
A replay of the call can be accessed until November 20, 2024 by dialing (800) 770-2030, or (609) 800-9909 for international callers, Conference ID# 8741406. A transcript of the conference call will be made available under the Investor Relations section of the Astec Industries, Inc. website within 5 business days after the call.
About Astec
Astec, (www.astecindustries.com), is a manufacturer of specialized equipment for asphalt road building, aggregate processing and concrete production. Astec's manufacturing operations are divided into two primary business segments: Infrastructure Solutions that includes road building, asphalt and concrete plants, thermal and storage solutions; and Materials Solutions that include our aggregate processing equipment. Astec also operates a line of controls and automation products designed to deliver enhanced productivity through improved equipment performance.
Safe Harbor Statements under the Private Securities Litigation Reform Act of 1995
This News Release contains forward-looking statements within the meaning of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Such statements relate to, among other things, income, earnings, cash flows, changes in operations, operating improvements, businesses in which we operate and the United States and global economies. Statements in this News Release that are not historical are hereby identified as "forward-looking statements" and may be indicated by words or phrases such as "anticipates," "supports," "plans," "projects," "expects," "believes," "should," "would," "could," "forecast," "management is of the opinion," use of the future tense and similar words or phrases. These forward-looking statements are based largely on management's expectations, which are subject to a number of known and unknown risks, uncertainties and other factors discussed and described in our most recent Annual Report on Form 10-K, including those risks described in Part I, Item 1A. Risk Factors thereof, and in other reports filed subsequently by us with the Securities and Exchange Commission, which may cause actual results, financial or otherwise, to be materially different from those anticipated, expressed or implied by the forward-looking statements. All forward-looking statements included in this document are based on information available to us on the date hereof, and we assume no obligation to update any such forward-looking statements to reflect future events or circumstances, except as required by law.
Non-GAAP Financial Measures
In an effort to provide investors with additional information regarding the Company's results, the Company refers to various U.S. GAAP (U.S. generally accepted accounting principles) and non-GAAP financial measures which management believes provides useful information to investors. These non-GAAP financial measures have no standardized meaning prescribed by U.S. GAAP and therefore may not be comparable to the calculation of similar measures for other companies. Management of the Company does not intend these items to be considered in isolation or as a substitute for the related GAAP measures. Nonetheless, this non-GAAP information can be useful in understanding the Company's operating results and the performance of its core business. Management of the Company uses both GAAP and non-GAAP financial measures to establish internal budgets and targets and to evaluate the Company's financial performance against such budgets and targets. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measure is included in this News Release.
For Additional Information Contact:
Steve Anderson
Senior Vice President of Administration and Investor Relations
Phone: (423) 899-5898
E-mail: sanderson@astecindustries.com
Certain reclassifications have been made to the prior period financial information included in this News Release to conform to the presentation used in the financial statements for the three months ended September 30, 2024.
| Astec Industries Inc. Condensed Consolidated Statements of Operations (In millions, except shares in thousands and per share amounts; unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net sales | $ | 291.4 | $ | 303.1 | $ | 946.1 | $ | 1,001.0 | |||||||
| Cost of sales | 224.6 | 233.5 | 721.1 | 759.3 | |||||||||||
| Gross profit | 66.8 | 69.6 | 225.0 | 241.7 | |||||||||||
| Operating expenses: | |||||||||||||||
| Selling, general and administrative expenses | 65.6 | 74.3 | 208.1 | 206.7 | |||||||||||
| Goodwill impairment | — | — | 20.2 | — | |||||||||||
| Restructuring, other impairment and asset charges, net | 8.4 | 0.5 | 8.3 | 5.3 | |||||||||||
| Total operating expenses | 74.0 | 74.8 | 236.6 | 212.0 | |||||||||||
| (Loss) income from operations | (7.2 | ) | (5.2 | ) | (11.6 | ) | 29.7 | ||||||||
| Other expenses, net: | |||||||||||||||
| Interest expense | (2.6 | ) | (2.4 | ) | (8.4 | ) | (6.4 | ) | |||||||
| Other income, net | 1.3 | 0.5 | 2.5 | 2.0 | |||||||||||
| (Loss) income before income taxes | (8.5 | ) | (7.1 | ) | (17.5 | ) | 25.3 | ||||||||
| Income tax (benefit) provision | (2.3 | ) | (0.6 | ) | (0.6 | ) | 6.5 | ||||||||
| Net (loss) income | (6.2 | ) | (6.5 | ) | (16.9 | ) | 18.8 | ||||||||
| Net (income) loss attributable to noncontrolling interest | — | (0.1 | ) | 0.1 | (0.2 | ) | |||||||||
| Net (loss) income attributable to controlling interest | $ | (6.2 | ) | $ | (6.6 | ) | $ | (16.8 | ) | $ | 18.6 | ||||
| Earnings per common share | |||||||||||||||
| Basic | $ | (0.27 | ) | $ | (0.29 | ) | $ | (0.74 | ) | $ | 0.82 | ||||
| Diluted | (0.27 | ) | (0.29 | ) | (0.74 | ) | 0.82 | ||||||||
| Weighted average shares outstanding | |||||||||||||||
| Basic | 22,816 | 22,747 | 22,792 | 22,709 | |||||||||||
| Diluted | 22,816 | 22,747 | 22,792 | 22,776 | |||||||||||
| Astec Industries Inc. Reportable Segment Net Sales and Operating Adjusted EBITDA (In millions, except percentage data; unaudited) |
Reportable segment net sales exclude intersegment sales.
| Three Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | $ Change | % Change | |||||||||||
| Revenues from external customers | ||||||||||||||
| Infrastructure Solutions | $ | 165.0 | $ | 163.2 | $ | 1.8 | 1.1 | % | ||||||
| Materials Solutions | 126.4 | 139.9 | (13.5 | ) | (9.6 | )% | ||||||||
| Net sales | $ | 291.4 | $ | 303.1 | $ | (11.7 | ) | (3.9 | )% | |||||
| Segment Operating Adjusted EBITDA | ||||||||||||||
| Infrastructure Solutions | $ | 15.6 | $ | 13.3 | $ | 2.3 | 17.3 | % | ||||||
| Materials Solutions | 14.5 | 9.5 | 5.0 | 52.6 | % | |||||||||
| Segment Operating Adjusted EBITDA - Reportable Segments | 30.1 | 22.8 | ||||||||||||
| Reconciliation of Segment Operating Adjusted EBITDA to "(Loss) income before income taxes" | ||||||||||||||
| Corporate and Other | (12.7 | ) | (12.8 | ) | ||||||||||
| Transformation program | (8.4 | ) | (7.7 | ) | ||||||||||
| Restructuring and other related charges | (8.4 | ) | (0.1 | ) | ||||||||||
| (Loss) gain on sale of property and equipment, net | — | (0.4 | ) | |||||||||||
| Interest expense, net | (2.1 | ) | (1.9 | ) | ||||||||||
| Depreciation and amortization | (7.0 | ) | (7.1 | ) | ||||||||||
| Net income attributable to noncontrolling interest | — | 0.1 | ||||||||||||
| (Loss) income before income taxes | $ | (8.5 | ) | $ | (7.1 | ) | ||||||||
| Segment Operating Adjusted EBITDA Margin | 2024 | 2023 | Change | |||||||||||
| Infrastructure Solutions | 9.5 | % | 8.1 | % | 140 bps | |||||||||
| Materials Solutions | 11.5 | % | 6.8 | % | 470 bps | |||||||||
| (Continued) | ||||||||||||||
| Astec Industries Inc. Reportable Segment Net Sales and Operating Adjusted EBITDA (Continued) (In millions, except percentage data; unaudited) | |||||||||||||||
| Nine Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | $ Change | % Change | ||||||||||||
| Revenues from external customers | |||||||||||||||
| Infrastructure Solutions | $ | 588.6 | $ | 578.1 | $ | 10.5 | 1.8 | % | |||||||
| Materials Solutions | 357.5 | 422.9 | (65.4 | ) | (15.5 | )% | |||||||||
| Net sales | $ | 946.1 | $ | 1,001.0 | $ | (54.9 | ) | (5.5 | )% | ||||||
| Segment Operating Adjusted EBITDA | |||||||||||||||
| Infrastructure Solutions | $ | 68.4 | $ | 67.5 | $ | 0.9 | 1.3 | % | |||||||
| Materials Solutions | 30.0 | 42.4 | (12.4 | ) | (29.2 | )% | |||||||||
| Segment Operating Adjusted EBITDA - Reportable Segments | 98.4 | 109.9 | |||||||||||||
| Reconciliation of Segment Operating Adjusted EBITDA to "(Loss) income before income taxes" | |||||||||||||||
| Corporate and Other | (34.5 | ) | (32.5 | ) | |||||||||||
| Transformation program | (25.8 | ) | (22.5 | ) | |||||||||||
| Restructuring and other related charges | (9.4 | ) | (7.6 | ) | |||||||||||
| Goodwill impairment | (20.2 | ) | — | ||||||||||||
| Asset impairment | — | (0.8 | ) | ||||||||||||
| (Loss) gain on sale of property and equipment, net | 1.1 | 3.1 | |||||||||||||
| Interest expense, net | (6.9 | ) | (4.9 | ) | |||||||||||
| Depreciation and amortization | (20.1 | ) | (19.6 | ) | |||||||||||
| Net income (loss) attributable to noncontrolling interest | (0.1 | ) | 0.2 | ||||||||||||
| (Loss) income before income taxes | $ | (17.5 | ) | $ | 25.3 | ||||||||||
| Segment Operating Adjusted EBITDA Margin | 2024 | 2023 | Change | ||||||||||||
| Infrastructure Solutions | 11.6 | % | 11.7 | % | (10) bps | ||||||||||
| Materials Solutions | 8.4 | % | 10.0 | % | (160) bps | ||||||||||
| Astec Industries Inc. Condensed Consolidated Balance Sheets (In millions; unaudited) | |||||||
| September 30, 2024 | December 31, 2023 | ||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash, cash equivalents and restricted cash | $ | 55.3 | $ | 63.2 | |||
| Investments | 3.6 | 5.7 | |||||
| Trade receivables, contract assets and other receivables, net | 175.2 | 152.7 | |||||
| Inventories, net | 466.4 | 455.6 | |||||
| Other current assets, net | 39.6 | 42.3 | |||||
| Total current assets | 740.1 | 719.5 | |||||
| Property, plant and equipment, net | 185.3 | 187.6 | |||||
| Other long-term assets | 141.7 | 152.2 | |||||
| Total assets | $ | 1,067.1 | $ | 1,059.3 | |||
| Liabilities | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 87.8 | $ | 116.9 | |||
| Customer deposits | 84.0 | 70.2 | |||||
| Other current liabilities | 127.4 | 111.9 | |||||
| Total current liabilities | 299.2 | 299.0 | |||||
| Long-term debt | 99.0 | 72.0 | |||||
| Other long-term liabilities | 37.5 | 34.6 | |||||
| Total equity | 631.4 | 653.7 | |||||
| Total liabilities and equity | $ | 1,067.1 | $ | 1,059.3 | |||
| Astec Industries Inc. Condensed Consolidated Statements of Cash Flows (In millions; unaudited) | |||||||
| Nine Months Ended September 30, | |||||||
| 2024 | 2023 | ||||||
| Cash flows from operating activities: | |||||||
| Net (loss) income | $ | (16.9 | ) | $ | 18.8 | ||
| Adjustments to reconcile net (loss) income to net cash used in operating activities: | |||||||
| Depreciation and amortization | 20.1 | 19.6 | |||||
| Provision for credit losses | 1.0 | 0.6 | |||||
| Provision for warranties | 12.8 | 14.4 | |||||
| Deferred compensation (benefit) expense | (0.1 | ) | 0.2 | ||||
| Share-based compensation | 3.7 | 3.5 | |||||
| Deferred tax benefit | (6.7 | ) | (2.1 | ) | |||
| Gain on disposition of property and equipment, net | (1.1 | ) | (3.1 | ) | |||
| Goodwill impairment | 20.2 | — | |||||
| Other impairment charges | — | 0.8 | |||||
| Amortization of debt issuance costs | 0.2 | 0.2 | |||||
| Distributions to deferred compensation programs' participants | (0.8 | ) | (1.5 | ) | |||
| Change in operating assets and liabilities: | |||||||
| Purchase of trading securities, net | (1.6 | ) | (1.4 | ) | |||
| Receivables and other contract assets | (23.9 | ) | (5.8 | ) | |||
| Inventories | (9.9 | ) | (59.7 | ) | |||
| Prepaid expenses | 2.8 | 8.3 | |||||
| Other assets | (2.1 | ) | (9.6 | ) | |||
| Accounts payable | (28.5 | ) | 7.1 | ||||
| Accrued loss reserves | (0.3 | ) | 1.2 | ||||
| Accrued employee related liabilities | (4.7 | ) | 9.3 | ||||
| Other accrued liabilities | 22.0 | (0.8 | ) | ||||
| Accrued product warranty | (14.1 | ) | (9.6 | ) | |||
| Customer deposits | 13.5 | (8.2 | ) | ||||
| Income taxes payable/prepaid | 0.8 | (1.0 | ) | ||||
| Net cash used in operating activities | (13.6 | ) | (18.8 | ) | |||
| Cash flows from investing activities: | |||||||
| Expenditures for property and equipment | (16.0 | ) | (25.0 | ) | |||
| Proceeds from sale of property and equipment | 2.3 | 20.2 | |||||
| Purchase of investments | (0.9 | ) | (0.8 | ) | |||
| Sale of investments | 0.6 | 1.7 | |||||
| Net cash used in investing activities | (14.0 | ) | (3.9 | ) | |||
| (Continued) | |||||||
| Astec Industries Inc. Condensed Consolidated Statements of Cash Flows (Continued) (In millions; unaudited) | |||||||
| Nine Months Ended September 30, | |||||||
| 2024 | 2023 | ||||||
| Cash flows from financing activities: | |||||||
| Payment of dividends | (8.9 | ) | (8.9 | ) | |||
| Proceeds from borrowings on credit facilities and bank loans | 140.6 | 221.4 | |||||
| Repayments of borrowings on credit facilities and bank loans | (111.9 | ) | (180.2 | ) | |||
| Sale of Company stock by deferred compensation programs, net | 0.2 | 0.1 | |||||
| Withholding tax paid upon vesting of share-based compensation awards | (0.5 | ) | (1.6 | ) | |||
| Net cash provided by financing activities | 19.5 | 30.8 | |||||
| Effect of exchange rates on cash | 0.2 | (0.3 | ) | ||||
| (Decrease) increase in cash, cash equivalents and restricted cash | (7.9 | ) | 7.8 | ||||
| Cash, cash equivalents and restricted cash, beginning of period | 63.2 | 66.0 | |||||
| Cash, cash equivalents and restricted cash, end of period | $ | 55.3 | $ | 73.8 | |||
We present certain non-GAAP information that can be useful in understanding our operating results and the performance of our core business. We use both GAAP and non-GAAP financial measures to establish internal budgets and targets and to evaluate financial performance against such budgets and targets. We exclude the costs and related tax effects, which are based on the statutory tax rate applicable to each respective item unless otherwise noted below, of the following items as we do not believe they are indicative of our core business operations:
- Transformation program - Incremental costs related to the execution of our ongoing strategic transformation initiatives which may include personnel costs, third-party consultant costs, duplicative systems usage fees, administrative costs, accelerated depreciation and amortization on certain long-lived assets and other similar type charges. Transformation program initiatives include our multi-year phased implementation of a standardized enterprise resource planning system across the global organization and a lean manufacturing initiative at one of our largest manufacturing sites that was largely completed during 2023 with certain capital investments finalized in early 2024. Transformation program costs for the lean manufacturing initiative ceased at the end of 2023. These costs are included in "Cost of sales" and "Selling, general and administrative expenses", as appropriate, in the Consolidated Statements of Operations.
- Restructuring and other related charges - Charges related to restructuring activities which primarily include personnel termination actions and reorganization efforts to simplify and consolidate our operations. These activities include the workforce reductions effected in the second quarter of 2024, the termination of our previous Chief Executive Officer, the limited overhead restructuring action implemented in February 2023 and ongoing litigation costs for our exited Enid location, including the settlement loss recorded in the third quarter of 2024. These costs are recorded in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations.
- Goodwill impairment - Goodwill impairment charges, to the extent that they are experienced, are recorded in "Goodwill impairment" in the Consolidated Statements of Operations. These charges are associated with the impairment of the goodwill allocated to the Materials Solutions reporting unit during the second quarter of 2024. The goodwill impairment is largely nondeductible for tax purposes and, as such, the tax impact applied reflects the actual tax impact by jurisdiction.
- Asset impairment - Asset impairment charges, to the extent that they are experienced, are recorded in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations. These include charges associated with abandoned in-process internally developed software that was determined to be impaired during the second quarter of 2023.
- (Loss) gain on sale of property and equipment, net - Gains or losses recognized on the disposal of property and equipment that are recorded in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations. We may sell or dispose of assets in the normal course of our business operations as they are no longer needed or used.
| Astec Industries Inc. GAAP vs Non-GAAP Adjusted Income from Operations Reconciliations (In millions, except percentage data; unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net sales | $ | 291.4 | $ | 303.1 | $ | 946.1 | $ | 1,001.0 | |||||||
| (Loss) income from operations | $ | (7.2 | ) | $ | (5.2 | ) | $ | (11.6 | ) | $ | 29.7 | ||||
| Adjustments: | |||||||||||||||
| Transformation program | 8.7 | 7.8 | 26.4 | 22.8 | |||||||||||
| Restructuring and other related charges | 8.4 | 0.1 | 9.4 | 7.6 | |||||||||||
| Goodwill impairment | — | — | 20.2 | — | |||||||||||
| Asset impairment | — | — | — | 0.8 | |||||||||||
| Loss (gain) on sale of property and equipment, net | — | 0.4 | (1.1 | ) | (3.1 | ) | |||||||||
| Adjusted income from operations | $ | 9.9 | $ | 3.1 | $ | 43.3 | $ | 57.8 | |||||||
| Adjusted operating margin | 3.4 | % | 1.0 | % | 4.6 | % | 5.8 | % | |||||||
| Astec Industries Inc. GAAP vs Non-GAAP Adjusted EPS Reconciliations (In millions, except per share amounts; unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net (loss) income attributable to controlling interest | $ | (6.2 | ) | $ | (6.6 | ) | $ | (16.8 | ) | $ | 18.6 | ||||
| Adjustments: | |||||||||||||||
| Transformation program | 8.7 | 7.8 | 26.4 | 22.8 | |||||||||||
| Restructuring and other related charges | 8.4 | 0.1 | 9.4 | 7.6 | |||||||||||
| Goodwill impairment | — | — | 20.2 | — | |||||||||||
| Asset impairment | — | — | — | 0.8 | |||||||||||
| Loss (gain) on sale of property and equipment, net | — | 0.4 | (1.1 | ) | (3.1 | ) | |||||||||
| Income tax impact of adjustments | (3.9 | ) | (1.9 | ) | (9.3 | ) | (6.5 | ) | |||||||
| Adjusted net income (loss) attributable to controlling interest | $ | 7.0 | $ | (0.2 | ) | $ | 28.8 | $ | 40.2 | ||||||
| Diluted EPS | $ | (0.27 | ) | $ | (0.29 | ) | $ | (0.74 | ) | $ | 0.82 | ||||
| Adjustments: | |||||||||||||||
| Transformation program | 0.38 | 0.34 | 1.16 | 1.00 | |||||||||||
| Restructuring and other related charges (a) | 0.37 | — | 0.41 | 0.34 | |||||||||||
| Goodwill impairment | — | — | 0.89 | — | |||||||||||
| Asset impairment | — | — | — | 0.04 | |||||||||||
| Loss (gain) on sale of property and equipment, net | — | 0.02 | (0.05 | ) | (0.14 | ) | |||||||||
| Income tax impact of adjustments | (0.17 | ) | (0.08 | ) | (0.41 | ) | (0.29 | ) | |||||||
| Adjusted EPS | $ | 0.31 | $ | (0.01 | ) | $ | 1.26 | $ | 1.77 | ||||||
| (a) Calculation includes the impact of a rounding adjustment | |||||||||||||||
| Astec Industries Inc. EBITDA and Adjusted EBITDA Reconciliations (In millions, except percentage data; unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net sales | $ | 291.4 | $ | 303.1 | $ | 946.1 | $ | 1,001.0 | |||||||
| Net (loss) income attributable to controlling interest | $ | (6.2 | ) | $ | (6.6 | ) | $ | (16.8 | ) | $ | 18.6 | ||||
| Interest expense, net | 2.1 | 1.9 | 6.9 | 4.9 | |||||||||||
| Depreciation and amortization | 7.0 | 7.1 | 20.1 | 19.6 | |||||||||||
| Income tax (benefit) provision | (2.3 | ) | (0.6 | ) | (0.6 | ) | 6.5 | ||||||||
| EBITDA | 0.6 | 1.8 | 9.6 | 49.6 | |||||||||||
| EBITDA margin | 0.2 | % | 0.6 | % | 1.0 | % | 5.0 | % | |||||||
| Adjustments: | |||||||||||||||
| Transformation program | 8.4 | 7.7 | 25.8 | 22.5 | |||||||||||
| Restructuring and other related charges | 8.4 | 0.1 | 9.4 | 7.6 | |||||||||||
| Goodwill impairment | — | — | 20.2 | — | |||||||||||
| Asset impairment | — | — | — | 0.8 | |||||||||||
| Loss (gain) on sale of property and equipment, net | — | 0.4 | (1.1 | ) | (3.1 | ) | |||||||||
| Adjusted EBITDA | $ | 17.4 | $ | 10.0 | $ | 63.9 | $ | 77.4 | |||||||
| Adjusted EBITDA margin | 6.0 | % | 3.3 | % | 6.8 | % | 7.7 | % | |||||||
| Astec Industries Inc. Free Cash Flow Reconciliation (In millions; unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net cash provided by (used in) operating activities | $ | 22.5 | $ | (16.3 | ) | $ | (13.6 | ) | $ | (18.8 | ) | ||||
| Expenditures for property and equipment | (2.6 | ) | (7.9 | ) | (16.0 | ) | (25.0 | ) | |||||||
| Free cash flow | $ | 19.9 | $ | (24.2 | ) | $ | (29.6 | ) | $ | (43.8 | ) | ||||
FAQ
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