NYSE$AZZ

Azz Inc · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

Reported solid demand and robust cash flow generation, reducing net leverage.

AZZ Inc. reported strong third-quarter sales, driven by growth in both Metal Coatings and Precoat Metals segments. The divestiture of the Infrastructure Solutions segment was completed, resulting in EPS growth from continuing operations. The company is raising its full-year adjusted EPS guidance.

  • Sales from continuing operations reached $373.3 million.
  • Metal Coatings sales increased by 17.2%, and Precoat Metals sales increased by 14.8%.
  • Consolidated Adjusted EPS was $0.88, while Reported Diluted EPS was $(0.97).
  • Net income from continuing operations was $18.4 million, compared to $13.1 million in the prior year.

Headline financials

Total Revenue

$373M

Previous: $232M+61.1%
EPS (adj)

$0.88

Previous: $0.85+3.5%
Adjusted EBITDA

$71.2M

No prior period
Capital Expenditures

-$35.1M

Previous: -$19.1M-83.4%
Free Cash Flow

-$55.6M

Previous: $1.95M-2946.8%
Net Income

-$20.5M

Previous: $21.1M-197.4%
Operating Income

$45.4M

Previous: $30.1M+50.8%
Gross Profit

$73.1M

Previous: $57M+28.3%
Cash & Equivalents

$3.29M

Previous: $20.4M-83.8%
Total Assets

$2.2B

Previous: $1.04B+112.0%
Stock-Based Comp

$2.37M

Previous: $1.86M+27.3%

Revenue & EPS history

Azz · Revenue · Quarterly

$373M

Q3 2023+61.1%vs Q3 2022
Beat estimate in 7 of 14 quarters(50%)
ActualEstimate

Revenue by segment

Azz · $373M total across 2 segments · Q3 2023

  • Precoat Metals
    $215M
  • Metal Coatings
    $158M+18.7%

Forward guidance

The company reaffirms its annual sales guidance range of $1.27 billion to $1.32 billion and raises its guidance for adjusted earnings per diluted share for fiscal year 2023 to $4.05 – $4.25.

Tailwinds

  • Consistent operating performance in business segments.
  • Strong performance within segments during the third quarter.
  • Focus on growth strategy reinforced by market position.
  • Strong underlying fundamentals of business.
  • Secular growth drivers in place in key end-markets.

Headwinds

  • Seasonally lower fourth quarter.
  • Additional interest expense.
  • Dividends on Preferred Stock.
  • Impact of a normalized forward-looking tax rate.
  • Potential impact of equity in earnings on investment in the AIS JV.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2023

Historical avgQ3 2023

-0.7%

Avg return

Earnings day

-0.9%

Avg return

5 days after

+1.7%

Avg return

30 days after

38%

25 / 65 earnings

Positive

+19.3%

Q1 2019

Best reaction

-14.4%

Q1 2014

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q4 2026-1.3%+4.9%+1.6%
Q3 2026+6.5%+10.9%+18.4%
Q2 2026-5.3%-5.3%-5.6%
Q1 2026+3.2%+4.9%+6.0%
Q4 2025+3.1%+9.8%+15.4%
Q3 2025-2.3%-1.6%+12.3%
Q2 2025-4.2%+0.6%+4.9%
Q1 2025+8.2%+10.9%-1.4%
Q4 2024+10.9%-4.4%+12.3%
Q3 2024-0.4%+1.5%+17.8%
Q2 2024+6.7%+3.5%+1.0%
Q1 2024+2.7%+4.4%+9.1%
Q4 2023-7.2%-4.8%-10.9%
Q3 2023+6.9%+4.2%-2.3%
Q2 2023-0.4%-15.0%+1.8%
Q1 2023-2.3%-3.4%+4.8%
Q4 2022-2.2%-5.2%-9.5%
Q3 2022-5.8%-6.5%-11.4%
Q2 2022+2.4%-2.5%+2.9%
Q1 2022+6.8%+2.2%+2.6%
Q4 2021-1.5%-1.1%+0.2%
Q3 2021+1.4%-4.1%+0.5%
Q2 2021-4.7%-6.5%+0.6%
Q1 2021-11.6%-12.3%+1.8%
Q4 2020+4.6%-4.6%+5.5%
Q3 2020-2.2%-1.3%-6.3%
Q2 2020+18.4%+15.9%+17.9%
Q1 2020+2.1%+0.2%-6.1%
Q4 2019-0.7%-5.2%-3.9%
Q3 2019+7.2%+9.7%+8.9%
Q2 2019-9.1%-6.1%-1.7%
Q1 2019+19.3%+21.2%+24.0%
Q4 2018-8.4%-6.8%+0.8%
Q3 2018-8.4%-6.8%+0.8%
Q2 2018-5.4%-8.0%-5.9%
Q1 2018-14.0%-12.9%-9.8%
Q4 2017-3.5%+3.7%-7.7%
Q3 2017-11.3%-6.7%-8.3%
Q2 2017-10.4%-14.8%-19.1%
Q1 2017+0.1%+0.3%+4.6%
Q4 2016-0.0%
Q3 2016-0.7%
Q2 2016-1.7%
Q1 2016-1.1%
Q4 2015+3.5%
Q3 2015-7.7%
Q2 2015+3.5%
Q1 2015+9.6%
Q4 2014-2.3%
Q3 2014-14.1%
Q2 2014-0.4%
Q1 2014-14.4%
Q4 2013-2.4%
Q3 2013+4.2%
Q2 2013+9.3%
Q1 2012+2.2%
Q1 2013-1.5%
Q4 2012+1.6%
Q4 2010+1.6%
Q3 2011-0.2%
Q3 2012-0.2%
Q2 2011-6.0%
Q2 2012-6.0%
Q4 2011-6.0%
Q1 2011-3.6%

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