Armstrong World (AWI) Tops Q3 EPS by 20c, Revenues Beat; Offers FY20 Revenue Guidance Above Consensus

Armstrong World (NYSE: AWI) reported Q3 EPS of $1.13, $0.20 better than the analyst estimate of $0.93. Revenue for the quarter came in at $246.3 million versus the consensus estimate of $228.3 million.

• Net sales of $246.3 million, down 11% versus the prior year quarter
• Operating income of $72.3 million, down 36% versus the prior year quarter
• Adjusted EBITDA down 19% versus the prior year quarter
• Acquired Turf Design and Moz Designs during the quarter
• 2020 Guidance: Net Sales of $920-$935 million, EBITDA of $320-$330 million, and adjusted Free Cash Flow of $200-$210 million

“As expected, we saw a sequentially better demand environment in the third quarter, and we expect this improving trend to continue into the fourth quarter. I am pleased that in a quarter impacted by a pandemic we were able to close on two more strategic acquisitions, Turf Design and Moz Designs, our sixth and seventh acquisitions since 2017. Turf gives us the leading position in the growing category of felt ceilings, walls and barriers, and Moz extends our leadership position and capabilities in metal ceilings, walls and column covers,” said Vic Grizzle, President and CEO of Armstrong. “Ceilings play a critical role in the creation of healthy spaces and our recently announced 24/7 Defend line of products represent innovative new solutions to enable everyone to get back to life and work in a healthy and safe way.”

GUIDANCE:

Armstrong World sees FY2020 revenue of $920-935 million, versus the consensus of $905.92 million.

“Assuming continued sequential market improvement and no second wave of construction site shutdowns, we expect sales for the full year in the range of $920-$935 million, adjusted EBITDA in the range of $320-$330 million, and adjusted free cash flow of $200-$210 million,” said Brian MacNeal, CFO of Armstrong. “With a strong balance sheet and ample liquidity, we continue to remain confident in our ability to execute on our long-term value creation strategy.”

For earnings history and earnings-related data on Armstrong World (AWI) click here.

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