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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Apogee Enterprises Inc | NASDAQ:APOG | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.73 | 1.19% | 62.05 | 61.61 | 62.56 | 62.359 | 61.01 | 61.49 | 116,195 | 01:00:00 |
|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Minnesota
|
|
41-0919654
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
4400 West 78
th
Street – Suite 520,
Minneapolis, MN
|
|
55435
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
|
Page
|
PART I
|
|
|
|
|
|
Item 1.
|
|
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Item 2.
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Item 3.
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||
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Item 4.
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||
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PART II
|
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Item 1.
|
||
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Item 1A.
|
||
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Item 2.
|
||
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Item 6.
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||
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|
Item 1.
|
Financial Statements
|
(In thousands, except stock data)
|
|
June 3, 2017
|
|
March 4, 2017
|
||||
Assets
|
|
|
|
|
||||
Current assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
22,972
|
|
|
$
|
19,463
|
|
Short-term available for sale securities
|
|
425
|
|
|
548
|
|
||
Restricted cash
|
|
2,683
|
|
|
7,834
|
|
||
Receivables, net of allowance for doubtful accounts
|
|
180,483
|
|
|
185,740
|
|
||
Inventories
|
|
81,083
|
|
|
73,409
|
|
||
Refundable income taxes
|
|
—
|
|
|
1,743
|
|
||
Other current assets
|
|
9,626
|
|
|
8,724
|
|
||
Total current assets
|
|
297,272
|
|
|
297,461
|
|
||
Property, plant and equipment, net
|
|
250,979
|
|
|
246,748
|
|
||
Available for sale securities
|
|
7,551
|
|
|
9,041
|
|
||
Deferred tax assets
|
|
1,099
|
|
|
4,025
|
|
||
Goodwill
|
|
95,211
|
|
|
101,334
|
|
||
Intangible assets
|
|
105,330
|
|
|
106,686
|
|
||
Other non-current assets
|
|
22,155
|
|
|
19,363
|
|
||
Total assets
|
|
$
|
779,597
|
|
|
$
|
784,658
|
|
Liabilities and Shareholders’ Equity
|
|
|
|
|
||||
Current liabilities
|
|
|
|
|
||||
Accounts payable
|
|
$
|
63,666
|
|
|
$
|
63,182
|
|
Accrued payroll and related benefits
|
|
27,990
|
|
|
51,244
|
|
||
Accrued self-insurance reserves
|
|
5,901
|
|
|
8,575
|
|
||
Other current liabilities
|
|
32,979
|
|
|
34,200
|
|
||
Billings in excess of costs and earnings on uncompleted contracts
|
|
33,931
|
|
|
28,857
|
|
||
Accrued income taxes
|
|
2,801
|
|
|
—
|
|
||
Total current liabilities
|
|
167,268
|
|
|
186,058
|
|
||
Long-term debt
|
|
71,400
|
|
|
65,400
|
|
||
Unrecognized tax benefits
|
|
4,309
|
|
|
3,980
|
|
||
Long-term self-insurance reserves
|
|
8,254
|
|
|
8,831
|
|
||
Deferred tax liabilities
|
|
3,622
|
|
|
4,025
|
|
||
Other non-current liabilities
|
|
42,915
|
|
|
45,787
|
|
||
Commitments and contingent liabilities (Note 14)
|
|
|
|
|
||||
Shareholders’ equity
|
|
|
|
|
||||
Common stock of $0.33-1/3 par value; authorized 50,000,000 shares; issued and outstanding 28,787,701 and 28,680,841, respectively
|
|
9,596
|
|
|
9,560
|
|
||
Additional paid-in capital
|
|
152,107
|
|
|
150,111
|
|
||
Retained earnings
|
|
351,872
|
|
|
341,996
|
|
||
Common stock held in trust
|
|
(886
|
)
|
|
(875
|
)
|
||
Deferred compensation obligations
|
|
886
|
|
|
875
|
|
||
Accumulated other comprehensive loss
|
|
(31,746
|
)
|
|
(31,090
|
)
|
||
Total shareholders’ equity
|
|
481,829
|
|
|
470,577
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
779,597
|
|
|
$
|
784,658
|
|
|
|
Three Months Ended
|
||||||
(In thousands, except per share data)
|
|
June 3, 2017
|
|
May 28, 2016
|
||||
Net sales
|
|
$
|
272,307
|
|
|
$
|
247,880
|
|
Cost of sales
|
|
202,013
|
|
|
183,452
|
|
||
Gross profit
|
|
70,294
|
|
|
64,428
|
|
||
Selling, general and administrative expenses
|
|
46,188
|
|
|
38,179
|
|
||
Operating income
|
|
24,106
|
|
|
26,249
|
|
||
Interest income
|
|
167
|
|
|
275
|
|
||
Interest expense
|
|
444
|
|
|
157
|
|
||
Other income, net
|
|
179
|
|
|
256
|
|
||
Earnings before income taxes
|
|
24,008
|
|
|
26,623
|
|
||
Income tax expense
|
|
7,904
|
|
|
8,901
|
|
||
Net earnings
|
|
$
|
16,104
|
|
|
$
|
17,722
|
|
|
|
|
|
|
||||
Earnings per share - basic
|
|
$
|
0.56
|
|
|
$
|
0.62
|
|
Earnings per share - diluted
|
|
$
|
0.56
|
|
|
$
|
0.61
|
|
Weighted average basic shares outstanding
|
|
28,851
|
|
|
28,702
|
|
||
Weighted average diluted shares outstanding
|
|
28,861
|
|
|
28,895
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
June 3, 2017
|
|
May 28, 2016
|
||||
Net earnings
|
|
$
|
16,104
|
|
|
$
|
17,722
|
|
Other comprehensive (loss) earnings:
|
|
|
|
|
||||
Unrealized gain (loss) on marketable securities, net of $33 and ($9) of tax expense (benefit), respectively
|
|
62
|
|
|
(14
|
)
|
||
Foreign currency translation adjustments
|
|
(718
|
)
|
|
2,893
|
|
||
Other comprehensive (loss) earnings
|
|
(656
|
)
|
|
2,879
|
|
||
Total comprehensive earnings
|
|
$
|
15,448
|
|
|
$
|
20,601
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
June 3, 2017
|
|
May 28, 2016
|
||||
Operating Activities
|
|
|
|
|
||||
Net earnings
|
|
$
|
16,104
|
|
|
$
|
17,722
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
11,423
|
|
|
7,720
|
|
||
Share-based compensation
|
|
1,403
|
|
|
1,390
|
|
||
Deferred income taxes
|
|
2,540
|
|
|
377
|
|
||
Other, net
|
|
(1,223
|
)
|
|
(375
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Receivables
|
|
5,125
|
|
|
(13,225
|
)
|
||
Inventories
|
|
(7,712
|
)
|
|
(5,883
|
)
|
||
Accounts payable and accrued expenses
|
|
(30,736
|
)
|
|
(21,315
|
)
|
||
Billings in excess of costs and earnings on uncompleted contracts
|
|
5,109
|
|
|
10,513
|
|
||
Refundable and accrued income taxes
|
|
4,867
|
|
|
2,532
|
|
||
Other, net
|
|
(988
|
)
|
|
60
|
|
||
Net cash provided by (used in) operating activities
|
|
5,912
|
|
|
(484
|
)
|
||
Investing Activities
|
|
|
|
|
||||
Capital expenditures
|
|
(11,430
|
)
|
|
(17,725
|
)
|
||
Change in restricted cash
|
|
5,151
|
|
|
—
|
|
||
Purchases of marketable securities
|
|
(1,535
|
)
|
|
(2,643
|
)
|
||
Sales/maturities of marketable securities
|
|
3,220
|
|
|
1,892
|
|
||
Other, net
|
|
1,742
|
|
|
(1,842
|
)
|
||
Net cash used in investing activities
|
|
(2,852
|
)
|
|
(20,318
|
)
|
||
Financing Activities
|
|
|
|
|
||||
Borrowings on line of credit
|
|
37,000
|
|
|
1,893
|
|
||
Payments on line of credit
|
|
(31,000
|
)
|
|
—
|
|
||
Shares withheld for taxes, net of stock issued to employees
|
|
(1,596
|
)
|
|
(1,198
|
)
|
||
Dividends paid
|
|
(4,002
|
)
|
|
(3,560
|
)
|
||
Net cash provided by (used in) financing activities
|
|
402
|
|
|
(2,865
|
)
|
||
Increase (decrease) in cash and cash equivalents
|
|
3,462
|
|
|
(23,667
|
)
|
||
Effect of exchange rates on cash
|
|
47
|
|
|
164
|
|
||
Cash and cash equivalents at beginning of year
|
|
19,463
|
|
|
60,470
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
22,972
|
|
|
$
|
36,967
|
|
Noncash Activity
|
|
|
|
|
||||
Capital expenditures in accounts payable
|
|
$
|
4,201
|
|
|
$
|
3,455
|
|
(In thousands)
|
|
Common Shares Outstanding
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Retained Earnings
|
|
Common Stock Held in Trust
|
|
Deferred Compensation Obligation
|
|
Accumulated Other Comprehensive (Loss) Income
|
|||||||||||||
Balance at March 4, 2017
|
|
28,680
|
|
|
$
|
9,560
|
|
|
$
|
150,111
|
|
|
$
|
341,996
|
|
|
$
|
(875
|
)
|
|
$
|
875
|
|
|
$
|
(31,090
|
)
|
Net earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,104
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Unrealized gain on marketable securities, net of $33 tax expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
62
|
|
||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(718
|
)
|
||||||
Issuance of stock, net of cancellations
|
|
52
|
|
|
17
|
|
|
39
|
|
|
—
|
|
|
(11
|
)
|
|
11
|
|
|
—
|
|
||||||
Share-based compensation
|
|
—
|
|
|
—
|
|
|
1,403
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Exercise of stock options
|
|
100
|
|
|
33
|
|
|
800
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other share retirements
|
|
(44
|
)
|
|
(14
|
)
|
|
(246
|
)
|
|
(2,226
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cash dividends
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,002
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at June 3, 2017
|
|
28,788
|
|
|
$
|
9,596
|
|
|
$
|
152,107
|
|
|
$
|
351,872
|
|
|
$
|
(886
|
)
|
|
$
|
886
|
|
|
$
|
(31,746
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance at February 27, 2016
|
|
28,684
|
|
|
$
|
9,561
|
|
|
$
|
145,528
|
|
|
$
|
282,477
|
|
|
$
|
(837
|
)
|
|
$
|
837
|
|
|
$
|
(31,371
|
)
|
Net earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,722
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Unrealized loss on marketable securities, net of $9 tax benefit
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14
|
)
|
||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,893
|
|
||||||
Issuance of stock, net of cancellations
|
|
126
|
|
|
42
|
|
|
(3
|
)
|
|
—
|
|
|
(6
|
)
|
|
6
|
|
|
—
|
|
||||||
Share-based compensation
|
|
—
|
|
|
—
|
|
|
1,390
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax benefit associated with stock plans
|
|
—
|
|
|
—
|
|
|
188
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Exercise of stock options
|
|
9
|
|
|
3
|
|
|
62
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other share retirements
|
|
(30
|
)
|
|
(10
|
)
|
|
(155
|
)
|
|
(1,137
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cash dividends
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,560
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at May 28, 2016
|
|
28,789
|
|
|
$
|
9,596
|
|
|
$
|
147,010
|
|
|
$
|
295,502
|
|
|
$
|
(843
|
)
|
|
$
|
843
|
|
|
$
|
(28,492
|
)
|
1.
|
Basis of Presentation
|
2.
|
New Accounting Standards
|
•
|
We are in the process of evaluating the significance of the guidance to our operations and as we proceed, we will finalize our determination of adoption method.
|
•
|
We expect to have business units that will continue to recognize revenue at the point in time when goods are shipped, as that represents when control is transferred, and business units that will continue to recognize revenue over time, following a cost-to-cost percentage of completion method of revenue recognition. Additionally, we expect that one of our business units in the Architectural Framing Systems segment will change from recognizing revenue at a point in time to recognizing revenue over time, to better reflect transfer of control to the customer in line with the new guidance. This business unit represents approximately 10 percent of our total net sales and will follow a similar cost-to-cost percentage of completion method of revenue recognition, consistent with our other business units using percentage of completion.
|
3.
|
Share-Based Compensation
|
Stock Options and SARs
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Life
|
|
Aggregate Intrinsic Value
|
|||||
Outstanding at March 4, 2017
|
|
229,901
|
|
|
$
|
9.90
|
|
|
|
|
|
||
Awards exercised
|
|
(100,000
|
)
|
|
8.34
|
|
|
|
|
|
|||
Outstanding and exercisable at June 3, 2017
|
|
129,901
|
|
|
$
|
11.10
|
|
|
3.5 Years
|
|
$
|
5,830,913
|
|
Nonvested Shares and Units
|
|
Number of Shares and Units
|
|
Weighted Average Grant Date Fair Value
|
|||
Nonvested at March 4, 2017
|
|
279,204
|
|
|
$
|
44.80
|
|
Granted
|
|
50,686
|
|
|
54.50
|
|
|
Vested
|
|
(110,744
|
)
|
|
45.45
|
|
|
Nonvested at June 3, 2017
|
|
219,146
|
|
|
$
|
46.70
|
|
4.
|
Earnings per Share
|
|
Three Months Ended
|
||||
(In thousands)
|
June 3, 2017
|
|
May 28, 2016
|
||
Basic earnings per share – weighted average common shares outstanding
|
28,851
|
|
|
28,702
|
|
Weighted average effect of nonvested share grants and assumed exercise of stock options
|
10
|
|
|
193
|
|
Diluted earnings per share – weighted average common shares and potential common shares outstanding
|
28,861
|
|
|
28,895
|
|
5.
|
Inventories
|
(In thousands)
|
June 3, 2017
|
|
March 4, 2017
|
||||
Raw materials
|
$
|
25,380
|
|
|
$
|
22,761
|
|
Work-in-process
|
19,514
|
|
|
16,154
|
|
||
Finished goods
|
31,471
|
|
|
29,372
|
|
||
Costs and earnings in excess of billings on uncompleted contracts
|
4,718
|
|
|
5,122
|
|
||
Total inventories
|
$
|
81,083
|
|
|
$
|
73,409
|
|
6.
|
Marketable Securities
|
(In thousands)
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Estimated
Fair Value
|
||||
June 3, 2017
|
|
|
|
|
|
|
|
||||
Municipal bonds
|
7,888
|
|
|
145
|
|
|
(57
|
)
|
|
7,976
|
|
March 4, 2017
|
|
|
|
|
|
|
|
||||
Municipal bonds
|
9,595
|
|
|
91
|
|
|
(97
|
)
|
|
9,589
|
|
(In thousands)
|
Amortized Cost
|
|
Estimated Fair Value
|
||||
Due within one year
|
$
|
425
|
|
|
$
|
425
|
|
Due after one year through five years
|
2,656
|
|
|
2,696
|
|
||
Due after five years through 10 years
|
3,316
|
|
|
3,419
|
|
||
Due after 10 years through 15 years
|
1,291
|
|
|
1,236
|
|
||
Due beyond 15 years
|
200
|
|
|
200
|
|
||
Total
|
$
|
7,888
|
|
|
$
|
7,976
|
|
7.
|
Fair Value Measurements
|
(In thousands)
|
Quoted Prices in
Active Markets
(Level 1)
|
|
Other Observable Inputs (Level 2)
|
|
Total Fair Value
|
||||||
June 3, 2017
|
|
|
|
|
|
||||||
Cash equivalents
|
|
|
|
|
|
||||||
Money market funds
|
$
|
4,138
|
|
|
$
|
—
|
|
|
$
|
4,138
|
|
Commercial paper
|
—
|
|
|
1,400
|
|
|
1,400
|
|
|||
Total cash equivalents
|
4,138
|
|
|
1,400
|
|
|
5,538
|
|
|||
Short-term securities
|
|
|
|
|
|
||||||
Municipal bonds
|
—
|
|
|
425
|
|
|
425
|
|
|||
Long-term securities
|
|
|
|
|
|
||||||
Municipal bonds
|
—
|
|
|
7,551
|
|
|
7,551
|
|
|||
Total assets at fair value
|
$
|
4,138
|
|
|
$
|
9,376
|
|
|
$
|
13,514
|
|
March 4, 2017
|
|
|
|
|
|
||||||
Cash equivalents
|
|
|
|
|
|
||||||
Money market funds
|
$
|
4,423
|
|
|
$
|
—
|
|
|
$
|
4,423
|
|
Commercial paper
|
—
|
|
|
5,500
|
|
|
5,500
|
|
|||
Total cash equivalents
|
4,423
|
|
|
5,500
|
|
|
9,923
|
|
|||
Short-term securities
|
|
|
|
|
|
||||||
Municipal bonds
|
—
|
|
|
548
|
|
|
548
|
|
|||
Long-term securities
|
|
|
|
|
|
||||||
Municipal bonds
|
—
|
|
|
9,041
|
|
|
9,041
|
|
|||
Total assets at fair value
|
$
|
4,423
|
|
|
$
|
15,089
|
|
|
$
|
19,512
|
|
8.
|
Acquisition
|
|
Pro forma
|
||
In thousands, except per share data
|
May 28, 2016
|
||
Net sales
|
$
|
272,816
|
|
Net earnings
|
21,466
|
|
|
Earnings per share
|
|
||
Basic
|
0.75
|
|
|
Diluted
|
0.74
|
|
9.
|
Goodwill and Other Identifiable Intangible Assets
|
(In thousands)
|
Architectural Glass
|
|
Architectural Framing Systems
|
|
Architectural Services
|
|
Large-Scale
Optical
|
|
Total
|
||||||||||
Balance at February 27, 2016
|
$
|
25,639
|
|
|
$
|
36,680
|
|
|
$
|
1,120
|
|
|
$
|
10,557
|
|
|
$
|
73,996
|
|
Goodwill acquired
|
—
|
|
|
27,444
|
|
|
—
|
|
|
—
|
|
|
27,444
|
|
|||||
Foreign currency translation
|
317
|
|
|
(423
|
)
|
|
—
|
|
|
—
|
|
|
(106
|
)
|
|||||
Balance at March 4, 2017
|
25,956
|
|
|
63,701
|
|
|
1,120
|
|
|
10,557
|
|
|
101,334
|
|
|||||
Goodwill adjustment for purchase accounting
|
—
|
|
|
(5,860
|
)
|
|
—
|
|
|
—
|
|
|
(5,860
|
)
|
|||||
Foreign currency translation
|
50
|
|
|
(313
|
)
|
|
—
|
|
|
—
|
|
|
(263
|
)
|
|||||
Balance at June 3, 2017
|
$
|
26,006
|
|
|
$
|
57,528
|
|
|
$
|
1,120
|
|
|
$
|
10,557
|
|
|
$
|
95,211
|
|
(In thousands)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Foreign
Currency
Translation
|
|
Net
|
||||||||
June 3, 2017
|
|
|
|
|
|
|
|
|
||||||||
Definite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||||
Debt issue costs
|
|
$
|
4,066
|
|
|
$
|
(3,013
|
)
|
|
$
|
—
|
|
|
$
|
1,053
|
|
Non-compete agreements
|
|
6,286
|
|
|
(6,111
|
)
|
|
10
|
|
|
185
|
|
||||
Customer relationships
|
|
85,296
|
|
|
(15,263
|
)
|
|
(465
|
)
|
|
69,568
|
|
||||
Trademarks and other intangibles
|
|
25,950
|
|
|
(7,261
|
)
|
|
(103
|
)
|
|
18,586
|
|
||||
Total definite-lived intangible assets
|
|
$
|
121,598
|
|
|
$
|
(31,648
|
)
|
|
$
|
(558
|
)
|
|
$
|
89,392
|
|
Indefinite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||||
Trademarks
|
|
16,061
|
|
|
—
|
|
|
(123
|
)
|
|
15,938
|
|
||||
Total intangible assets
|
|
$
|
137,659
|
|
|
$
|
(31,648
|
)
|
|
$
|
(681
|
)
|
|
$
|
105,330
|
|
March 4, 2017
|
|
|
|
|
|
|
|
|
||||||||
Definite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||||
Debt issue costs
|
|
$
|
4,066
|
|
|
$
|
(2,960
|
)
|
|
$
|
—
|
|
|
$
|
1,106
|
|
Non-compete agreements
|
|
6,286
|
|
|
(6,025
|
)
|
|
(65
|
)
|
|
196
|
|
||||
Customer relationships
|
|
82,479
|
|
|
(14,013
|
)
|
|
(145
|
)
|
|
68,321
|
|
||||
Trademarks and other intangibles
|
|
25,950
|
|
|
(4,917
|
)
|
|
(31
|
)
|
|
21,002
|
|
||||
Total definite-lived intangible assets
|
|
$
|
118,781
|
|
|
$
|
(27,915
|
)
|
|
$
|
(241
|
)
|
|
$
|
90,625
|
|
Indefinite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||||
Trademarks
|
|
16,022
|
|
|
—
|
|
|
39
|
|
|
16,061
|
|
||||
Total intangible assets
|
|
$
|
134,803
|
|
|
$
|
(27,915
|
)
|
|
$
|
(202
|
)
|
|
$
|
106,686
|
|
(In thousands)
|
Remainder of Fiscal 2018
|
|
Fiscal 2019
|
|
Fiscal 2020
|
|
Fiscal 2021
|
|
Fiscal 2022
|
||||||||||
Estimated amortization expense
|
$
|
10,380
|
|
|
$
|
8,093
|
|
|
$
|
5,592
|
|
|
$
|
5,579
|
|
|
$
|
5,307
|
|
10.
|
Debt
|
11.
|
Employee Benefit Plans
|
|
Three Months Ended
|
||||||
(In thousands)
|
June 3, 2017
|
|
May 28, 2016
|
||||
Interest cost
|
$
|
133
|
|
|
$
|
139
|
|
Expected return on assets
|
(10
|
)
|
|
(10
|
)
|
||
Amortization of unrecognized net loss
|
57
|
|
|
56
|
|
||
Net periodic benefit cost
|
$
|
180
|
|
|
$
|
185
|
|
12.
|
Income Taxes
|
13.
|
Other Non-Current Liabilities
|
(In thousands)
|
June 3, 2017
|
|
March 4, 2017
|
||||
Deferred benefit from New Market Tax Credit transactions
|
$
|
16,708
|
|
|
$
|
16,708
|
|
Retirement plan obligations
|
9,635
|
|
|
9,635
|
|
||
Deferred compensation plan
|
9,526
|
|
|
7,463
|
|
||
Other
|
7,046
|
|
|
11,981
|
|
||
Total other non-current liabilities
|
$
|
42,915
|
|
|
$
|
45,787
|
|
(In thousands)
|
Remainder of Fiscal 2018
|
|
Fiscal 2019
|
|
Fiscal 2020
|
|
Fiscal 2021
|
|
Fiscal 2022
|
|
Thereafter
|
|
Total
|
||||||||||||||
Total minimum payments
|
$
|
9,047
|
|
|
$
|
10,821
|
|
|
$
|
9,259
|
|
|
$
|
6,297
|
|
|
$
|
5,604
|
|
|
$
|
8,823
|
|
|
$
|
49,851
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
June 3, 2017
|
|
May 28, 2016
|
||||
Balance at beginning of period
|
$
|
21,933
|
|
|
$
|
16,340
|
|
Additional accruals
|
1,240
|
|
|
1,463
|
|
||
Claims paid
|
(973
|
)
|
|
(1,129
|
)
|
||
Balance at end of period
|
$
|
22,200
|
|
|
$
|
16,674
|
|
15.
|
Segment Information
|
•
|
The Architectural Glass segment fabricates coated, high-performance glass used in customized window and wall systems comprising the outside skin of commercial, institutional and high-end multi-family residential buildings.
|
•
|
The Architectural Framing Systems segment designs, engineers, fabricates and finishes the aluminum frames used in customized aluminum and glass window, curtainwall, storefront and entrance systems comprising the outside skin and entrances of commercial, institutional and high-end multi-family residential buildings. The Company has aggregated
five
operating segments into this reporting segment based on their similar products, customers, distribution methods, production processes and economic characteristics.
|
•
|
The Architectural Services segment designs, engineers, fabricates and installs the walls of glass, windows and other curtainwall products making up the outside skin of commercial and institutional buildings.
|
•
|
The LSO segment manufactures value-added glass and acrylic products primarily for framing and display applications.
|
|
Three Months Ended
|
||||||
(In thousands)
|
June 3, 2017
|
|
May 28, 2016
|
||||
Net sales from operations
|
|
|
|
||||
Architectural Glass
|
$
|
97,735
|
|
|
$
|
93,360
|
|
Architectural Framing Systems
|
110,492
|
|
|
81,132
|
|
||
Architectural Services
|
50,150
|
|
|
62,820
|
|
||
Large-Scale Optical
|
18,603
|
|
|
20,028
|
|
||
Intersegment eliminations
|
(4,673
|
)
|
|
(9,460
|
)
|
||
Net sales
|
$
|
272,307
|
|
|
$
|
247,880
|
|
Operating income (loss) from operations
|
|
|
|
||||
Architectural Glass
|
$
|
9,322
|
|
|
$
|
9,531
|
|
Architectural Framing Systems
|
11,964
|
|
|
10,232
|
|
||
Architectural Services
|
782
|
|
|
3,181
|
|
||
Large-Scale Optical
|
4,050
|
|
|
4,652
|
|
||
Corporate and other
|
(2,012
|
)
|
|
(1,347
|
)
|
||
Operating income
|
$
|
24,106
|
|
|
$
|
26,249
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
Three Months Ended
|
|
||||
(Percent of net sales)
|
June 3, 2017
|
|
May 28, 2016
|
|
||
Net sales
|
100.0
|
%
|
|
100.0
|
%
|
|
Cost of sales
|
74.2
|
|
|
74.0
|
|
|
Gross profit
|
25.8
|
|
|
26.0
|
|
|
Selling, general and administrative expenses
|
17.0
|
|
|
15.4
|
|
|
Operating income
|
8.9
|
|
|
10.6
|
|
|
Interest and other (expense) income, net
|
(0.1
|
)
|
|
0.1
|
|
|
Earnings before income taxes
|
8.8
|
|
|
10.7
|
|
|
Income tax expense
|
2.9
|
|
|
3.6
|
|
|
Net earnings
|
5.9
|
%
|
|
7.1
|
%
|
|
Effective tax rate
|
32.9
|
%
|
|
33.4
|
%
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
June 3, 2017
|
|
May 28, 2016
|
|
%
Change
|
|||||
Net sales
|
$
|
97,735
|
|
|
$
|
93,360
|
|
|
4.7
|
%
|
Operating income
|
9,322
|
|
|
9,531
|
|
|
(2.2
|
)%
|
||
Operating margin
|
9.5
|
%
|
|
10.2
|
%
|
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
June 3, 2017
|
|
May 28, 2016
|
|
%
Change
|
|||||
Net sales
|
$
|
110,492
|
|
|
$
|
81,132
|
|
|
36.2
|
%
|
Operating income
|
11,964
|
|
|
10,232
|
|
|
16.9
|
%
|
||
Operating margin
|
10.8
|
%
|
|
12.6
|
%
|
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
June 3,
2017 |
|
May 28,
2016 |
|
%
Change
|
|||||
Net sales
|
$
|
50,150
|
|
|
$
|
62,820
|
|
|
(20.2
|
)%
|
Operating income
|
782
|
|
|
3,181
|
|
|
(75.4
|
)%
|
||
Operating margin
|
1.6
|
%
|
|
5.1
|
%
|
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
June 3, 2017
|
|
May 28, 2016
|
|
%
Change
|
|||||
Net sales
|
$
|
18,603
|
|
|
$
|
20,028
|
|
|
(7.1
|
)%
|
Operating income
|
4,050
|
|
|
4,652
|
|
|
(12.9
|
)%
|
||
Operating margin
|
21.8
|
%
|
|
23.2
|
%
|
|
|
Selected cash flow data
|
Three Months Ended
|
||||||
(In thousands)
|
June 3, 2017
|
|
May 28, 2016
|
||||
Operating Activities
|
|
|
|
||||
Net cash provided by operating activities
|
$
|
5,912
|
|
|
$
|
(484
|
)
|
Investing Activities
|
|
|
|
||||
Capital expenditures
|
(11,430
|
)
|
|
(17,725
|
)
|
||
Financing Activities
|
|
|
|
||||
Dividends paid
|
(4,002
|
)
|
|
(3,560
|
)
|
|
Payments Due by Fiscal Period
|
||||||||||||||||||||||||||
(In thousands)
|
Remainder of Fiscal 2018
|
|
Fiscal 2019
|
|
Fiscal 2020
|
|
Fiscal 2021
|
|
Fiscal 2022
|
|
Thereafter
|
|
Total
|
||||||||||||||
Long-term debt obligations
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,400
|
|
|
$
|
53,000
|
|
|
$
|
13,000
|
|
|
$
|
71,400
|
|
Operating leases (undiscounted)
|
9,047
|
|
|
10,821
|
|
|
9,259
|
|
|
6,297
|
|
|
5,604
|
|
|
8,823
|
|
|
49,851
|
|
|||||||
Purchase obligations
|
91,083
|
|
|
19,697
|
|
|
2,273
|
|
|
1,230
|
|
|
1,230
|
|
|
—
|
|
|
115,513
|
|
|||||||
Total cash obligations
|
$
|
100,130
|
|
|
$
|
30,518
|
|
|
$
|
11,532
|
|
|
$
|
12,927
|
|
|
$
|
59,834
|
|
|
$
|
21,823
|
|
|
$
|
236,764
|
|
•
|
Revenue growth of approximately 26 to 28 percent over fiscal 2017.
|
•
|
Operating margin of 10.5 percent to 11.0 percent.
|
•
|
Diluted earnings per share of $3.31 to $3.51.
|
•
|
Adjusted operating margin of 11.5 to 12.0 percent
and a
djusted diluted earnings per share of $3.65 to $3.85
(1)
.
|
•
|
Capital expenditures of approximately $60 million.
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 4.
|
Controls and Procedures
|
a)
|
Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this report (the Evaluation Date), we carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) of the Securities Exchange Act of 1934, as amended (the Exchange Act)). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of the Evaluation Date, our disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in applicable rules and forms, and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
|
b)
|
Changes in internal controls: There was no change in the Company’s internal control over financial reporting that occurred during the fiscal quarter ended
June 3, 2017
, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
|
Item 1.
|
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Period
|
|
Total Number
of Shares
Purchased (a)
|
|
Average Price
Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (b)
|
|
Maximum
Number of
Shares that May
Yet Be
Purchased
under the Plans
or Programs (b)
|
|||||
March 5, 2017 to April 1, 2017
|
|
802
|
|
|
$
|
59.61
|
|
|
—
|
|
|
942,367
|
|
April 2, 2017 to April 29, 2017
|
|
31,364
|
|
|
54.50
|
|
|
—
|
|
|
942,367
|
|
|
April 30, 2017 to June 3, 2017
|
|
13,660
|
|
|
53.40
|
|
|
—
|
|
|
942,367
|
|
|
Total
|
|
45,826
|
|
|
$
|
55.50
|
|
|
—
|
|
|
942,367
|
|
(a)
|
The shares in this column represent shares that were surrendered to us by plan participants to satisfy stock-for-stock option exercises or withholding tax obligations related to share-based compensation.
|
(b)
|
In fiscal 2004, the Board of Directors authorized the repurchase of 1,500,000 shares of Company stock, which was announced on April 10, 2003. Subsequently, the Board of Directors increased the authorization by 750,000 shares, which was announced on January 24, 2008; by 1,000,000 shares, which was announced on October 8, 2008; and by 1,000,000 shares, which was announced on January 13, 2016. The repurchase program does not have an expiration date.
|
Item 6.
|
Exhibits
|
2.1
|
Stock Purchase Agreement, dated as of April 28, 2017, by and among Apogee Enterprises, Inc., EFCO Corporation, and Pella Corporation. Incorporated herein by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K filed May 2, 2017.
|
|
|
10.1
|
Form of Bonus Pool Award Agreement under the Apogee Enterprises, Inc. 2012 Executive Management Incentive Plan. Incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed May 3, 2017.
|
|
|
10.2
|
Form of CEO Evaluation-Based Retention Incentive Agreement under the Apogee Enterprises, Inc. 2016 Executive Management Incentive Plan. Incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed May 3, 2017.
|
|
|
10.3
|
Amendment No. 1 to the Second Amended and Restated Credit Agreement, dated as of June 9, 2017, by and among the Company, the Lenders (as defined therein), and Wells Fargo Bank, National Association, as administrative agent for the Lenders, swingline lender and (with Comerica Bank) issuer of letters of credit. Incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed June 14, 2017.
|
|
|
31.1
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
|
31.2
|
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
|
32.1
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.2
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
101
|
The following materials from Apogee Enterprises, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 3, 2017 are furnished herewith, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets as of June 3, 2017 and March 4, 2017, (ii) the Consolidated Results of Operations for the three months ended June 3, 2017 and May 28, 2016, (iii) the Consolidated Statements of Comprehensive Earnings for the three months ended June 3, 2017 and May 28, 2016, (iv) the Consolidated Statements of Cash Flows for the three months ended June 3, 2017 and May 28, 2016, (v) the Consolidated Statements of Shareholders' Equity for the three months ended June 3, 2017 and May 28, 2016, and (vi) Notes to Consolidated Financial Statements.
|
|
|
APOGEE ENTERPRISES, INC.
|
|
|
|
|
|
Date: July 12, 2017
|
|
By: /s/ Joseph F. Puishys
|
|
|
|
|
Joseph F. Puishys
President and Chief
Executive Officer
(Principal Executive Officer)
|
Date: July 12, 2017
|
|
By: /s/ James S. Porter
|
|
|
|
|
James S. Porter
Executive Vice President and
Chief Financial Officer (Principal Financial and
Accounting Officer)
|
2.1
|
Stock Purchase Agreement, dated as of April 28, 2017, by and among Apogee Enterprises, Inc., EFCO Corporation, and Pella Corporation. Incorporated herein by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K filed May 2, 2017.
|
|
|
10.1
|
Form of Bonus Pool Award Agreement under the Apogee Enterprises, Inc. 2012 Executive Management Incentive Plan. Incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed May 3, 2017.
|
|
|
10.2
|
Form of CEO Evaluation-Based Retention Incentive Agreement under the Apogee Enterprises, Inc. 2016 Executive Management Incentive Plan. Incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed May 3, 2017.
|
|
|
10.3
|
Amendment No. 1 to the Second Amended and Restated Credit Agreement, dated as of June 9, 2017, by and among the Company, the Lenders (as defined therein), and Wells Fargo Bank, National Association, as administrative agent for the Lenders, swingline lender and (with Comerica Bank) issuer of letters of credit. Incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed June 14, 2017.
|
|
|
31.1
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
|
31.2
|
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
|
32.1
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.2
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
101
|
The following materials from Apogee Enterprises, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 3, 2017 are furnished herewith, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets as of June 3, 2017 and March 4, 2017, (ii) the Consolidated Results of Operations for the three months ended June 3, 2017 and May 28, 2016, (iii) the Consolidated Statements of Comprehensive Earnings for the three months ended June 3, 2017 and May 28, 2016, (iv) the Consolidated Statements of Cash Flows for the three months ended June 3, 2017 and May 28, 2016, (v) the Consolidated Statements of Shareholders' Equity for the three months ended June 3, 2017 and May 28, 2016, and (vi) Notes to Consolidated Financial Statements.
|
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