Volume 42, Issue 6 - June 2007

Financial Flash
Apogee Enterprises Increases Yearly, Fourth Quarter Earnings

Minneapolis-based Apogee Enterprises Inc. saw increases across the board in fiscal 2007, which ended in March. Its revenues increased 17 percent to $778.8 million. Earnings from continuing operations were $1.12 per share, up 29 percent from earnings of 87 cents per share a year ago, while net earnings rose $1.12 per share compared to 85 cents per share last year. In the architectural segment revenues were up 21 percent, and operating income more than doubled compared to the prior year.

“We are very pleased with fiscal 2007 results, which were driven by our architectural segment,” says Russell Huffer, Apogee chairperson and chief executive officer. “We achieved significant improvement in our architectural operating margin in fiscal 2007, increasing to 5.8 percent from 3.2 percent in the prior year. Architectural pricing increased, and operations improved. In addition, we had a better mix of projects with higher margins than during the prior year. And, strong markets supported our performance.”

During the fourth quarter of fiscal year 2007, the company saw revenues of $206.2 million, up 17 percent versus the prior-year period. Earnings from continuing operations rose to 32 cents per share versus 21 cents per share a year earlier. Net earnings were 34 cents per share versus 19 cents per share in the prior-year period. In the architectural segment, revenues of $184.3 million were up 20 percent, while operating income increased 140 percent—to $12.1 million—compared to the same time the year before.

“Our fourth-quarter performance underscored the strength of our architectural segment, which delivered significant growth in both revenues and operating income,” Huffer says. “Our architectural backlog again grew and now stands at $424 million, positioning Apogee for further growth in fiscal 2008.”

Outlook for fiscal year 2008 earnings from continuing operations has been increased to a range of $1.27 to $1.37 per share, up from the company’s prior guidance of $1.20 to $1.30 per share. www.apog.com

Vitro Reports Strong First Quarter
Vitro S.A.B. de C.V.’s consolidated sales increased 6.0 percent and its EBITDA rose 30.0 percent in the first quarter. The consolidated EBITDA margin increased 290 basis points to 15.9 percent for the quarter.

Excluding the divestiture of Quimica M in March 2006 and the acquisition of Vidrios Panamenos in April 2006, consolidated sales rose 5.3 percent and consolidated EBITDA increased 29.0 percent year over year. www.vitro.com

PPG Posts Highest Quarterly Sales in Company History
PPG Industries in Pittsburgh reported its highest quarter in company history in April. Aggressive acquisitions propelled the company to earnings of $2.9 billion, an 11-percent jump from first quarter sales. 

“We are beginning to realize the financial benefits of the acquisitions we made last year,” says Charles E. Bunch, PPG chairperson and chief executive officer. “Combined with strong organic growth, they enabled our optical and specialty materials segment and our two coatings segments to achieve aggregate sales growth of about 20 percent and to improve their operating earnings by 12 percent. Meanwhile, our commodity chemicals segment was down year-over-year but rebounded versus the fourth quarter, and the second quarter outlook is more positive.”

PPG’s glass sales decreased $17 million or 3 percent. The decreases in glass sales were due to lower volumes and selling prices, offset by stronger foreign currencies, according to PPG. www.ppg.com 

Glass Manufacturers Receive Statement of Objections from EC
The European Commission (EC) confirmed that it sent a Statement of Objections to a number of glass companies regarding their alleged role in a glass cartel. The commission says that it has reason to believe that the manufacturers concerned may have, among other things, coordinated price-increases and agreed on the introduction of an energy surcharge in the area of flat glass. Among the companies to receive the statements on March 13, and again on April 20, were U.K.-based Pilkington Group Ltd., a member of Nippon Sheet Glass Co. Ltd.; Belgium-based Glaverbel S.A., a member of Asahi Glass Co. Ltd.; and Saint-Gobain in France. 

The Statement of Objections are based on inspections carried out on February 22-23, 2005, and March 15, 2005, the commission’s subsequent investigation and information supplied under the commission’s leniency notice. 

Statements of Objections are a formal step in European Union antitrust investigations. After receiving such statements, companies have two months to defend themselves in writing. They also can ask the commission to hear their case at an oral hearing, which usually takes place about one month after the written reply has been received. Only after having heard the company’s defense can the commission take a final decision, which may be accompanied by fines of up to 10 percent of a company’s worldwide annual turnover. 

Pending further steps in the proceedings and until a final decision by the EC, the companies involved have refrained from any further comment. www.ec.europa.eu/index_en.htm


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