Apogee Enterprises (APOG) Guides Below for Q2; Reaffirms FY09 Guidance

July 28, 2008 7:55 AM EDT

Apogee Enterprises, Inc. (Nasdaq: APOG) reaffirmed its fiscal 2009 earnings guidance and updated its revenue outlook prior to participating in investor meetings in late July and August. Apogee provides distinctive value-added glass solutions for the architectural and picture framing industries.

“For full-year fiscal 2009, Apogee continues to expect earnings from continuing operations of $1.82 to $1.94 per share on revenue growth of 13 to 16 percent, up slightly from prior guidance of 12 to 15 percent growth,� said Russell Huffer, Apogee chairman and chief executive officer. “In addition, our fiscal 2010 outlook for 8 percent revenue and 20 percent earnings growth remains achievable based on the visibility resulting from our high backlog and commitment levels, as well as ongoing bidding activity, although in a more competitive environment. (FY09 EPS consensus is $1.84)

“Regarding quarterly timing of earnings for fiscal 2009, we anticipate that second quarter and first half earnings will be lower than Apogee and external expectations, as our architectural glass fabrication business works through internal production challenges carried over from the first quarter which have led to increased costs while we maintain our focus on delivering complete, high-quality product orders on-time to customers,� Huffer explained. He added that a small percentage of architectural work has also moved from the second quarter into the second half.

“In addition, earnings reported in equity in affiliates from our joint venture with PPG will be weaker than expected in the normally strong second quarter due to challenging aftermarket windshield market conditions and cost pressures,� he said. “With PPG’s agreement to sell a majority interest in its automotive glass and services businesses, expected to close in the next few months, we anticipate exercising our option to sell our full interest in this business – this will be the last step in our strategic exit of the auto replacement glass market. When PPG completes the sale of these businesses, Apogee anticipates receiving cash proceeds of approximately $25 million for its 34 percent interest in PPG Auto Glass.

“We anticipate fiscal 2009 second quarter earnings per share from continuing operations to be approximately equivalent to prior-year period earnings of $0.41 per share..." (Consensus is $0.46)[SM]

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