(Updated - July 3, 2018 6:33 AM EDT)

AZZ, Inc. (NYSE: AZZ) reported Q1 EPS of $0.60, $0.11 better than the analyst estimate of $0.49. Revenue for the quarter came in at $262.2 million versus the consensus estimate of $228.87 million.

Management Discussion

Tom Ferguson, president and chief executive officer of AZZ Inc., commented, "I am pleased to announce that we have started off fiscal year 2019 on a positive note, with 27.7% revenue growth year-over-year driven by strength in both our Energy and Metal Coatings segments. Overall, our bookings were up strongly in the quarter, growing to $320.5 million compared to $193.8 million in the first quarter last year. We booked some larger electrical projects in China, executed on meaningful refinery projects both domestically and internationally, and saw renewed demand in our metal coating segment that resulted in record quarterly sales of $115.3 million. The increase in bookings establishes a solid base of backlog to support our plan for the balance of this fiscal year."

"Metal Coatings segment revenue was up compared to the first quarter of last year. Operating margins were 21.9%, recovering sequentially from the 18.5% operating margin in the fourth quarter of fiscal 2018," Ferguson noted. \"We are pleased with the operating results, and we recognize that there are still headwinds in the galvanizing market due to both zinc and labor costs, but I am cautiously optimistic for this year. We believe that our Metal Coatings segment is well positioned for new revenue streams with our new powder coating facility in Crowley, Texas, as well as our two most recent Metal Coatings acquisitions of Enhanced Powder Coating, and Rogers Brothers Galvanizing. In addition, our new operation for AZZ's GalvaBar™ continuous galvanized rebar business is gaining traction."

Mr. Ferguson continued, "I am particularly happy to see our Energy segment\'s Welding Solutions group execute on several domestic refinery turnarounds, as well as several larger projects overseas. We are committed and focused on delivering organic growth and driving operational efficiencies including additional metal coatings offerings to drive future sales and maintaining an active M&A program to support our strategic growth initiatives. Looking forward, we are reaffirming our previously issued fiscal 2019 guidance of earnings per share in the range of $1.75 to $2.25 per diluted share and annual sales in the range of $900 million to $960 million. While we are somewhat optimistic at this point, we remain cautious due to the uncertainty related to tariffs and the Chinese trade situation, as well as the tighter market for craft labor."

First Quarter Results

• Revenues for the first quarter of fiscal year 2019 were $262.2 million compared to $205.3 million for the same quarter last year, an increase of 27.7%.
• Net income for the first quarter increased 30.3% to $15.7 million, or $0.60 per diluted share, compared to net income of $12.1 million, or $0.46 per diluted share, for the first quarter of fiscal year 2018.
• Gross margins for the first quarter of fiscal year 2019 were 22.4% compared to 23.1% in the first quarter of last year.
• Operating margins were 9.0% compared to 9.8% the first quarter of fiscal year 2018 as SG&A as a percentage of sales rose to 13.4% of sales compared to 13.3% of sales in the prior year.
• Additionally, the effective tax rate decreased to 22.0% in the current quarter compared to 28.4% in the first quarter of the prior year.
• Incoming orders for the quarter were $320.5 million while shipments for the quarter totaled $262.2 million, resulting in a book to ship ratio of 1.22.
• In the first quarter of fiscal year 2018 incoming orders were $193.8 million, resulting in a book to ship ratio of 0.94.
• Our backlog at the end of the first quarter of fiscal year 2019 increased 7.6% to $329.7 million compared to $306.4 million for the first quarter of last year.
• Approximately 43% of the current backlog is expected to be delivered outside the U.S., compared to 41% in the first quarter of fiscal year 2018.

For earnings history and earnings-related data on AZZ, Inc. (AZZ) click here.