Astec Industries, Inc. (Nasdaq: ASTE) today reported results for the third quarter ended September 30, 2006, including a rise in net sales.
Net sales for the third quarter of 2006 were $171.5 million compared to $149.1 million for the third quarter of 2005, for an increase of 15.0%. Domestic sales accounted for 65.8% and international sales 34.2% of the third quarter revenues of 2006 compared to 80.5% for domestic sales and 19.5% for international sales of the third quarter revenues for 2005. Net income for the third quarter of 2006 was $10.0 million, or $0.46 per diluted share.
Net income for the third quarter of 2005 was $10.0 million, or $0.47 per diluted share. Net income for the third quarter of 2005 included a gain on the sale of the Grapevine, Texas property, a real estate impairment charge and the charge-off of prepaid loan fees. Net income for the third quarter of 2006 was $10.0 million, or $0.46 per diluted share compared to net income excluding unusual items of $6.4 million for the third quarter of 2005, or $0.30 per diluted share, for a 57.4% increase in net income. These unusual items are presented in the attached reconciliation. The gain on the sale of real estate, offset by the impairment charge, is presented on a separate line on the 2005 income statement and the charge-off of prepaid loan fees is included in interest expense set forth therein.
Net sales for the nine months ended September 30, 2006 were $548.5 million compared with $481.6 million in the same period in 2005. Net income for the nine months ended September 30, 2006 was $33.3 million, or $1.52 per diluted share, compared to net income of $27.1 million, or $1.30 per diluted share for the same period in 2005. For the nine months ended September 30, 2005, excluding the unusual items mentioned above, net income was $23.4 million, or $1.12 per diluted share. Net income was $33.3 million for the nine months ended September 30, 2006 compared to net income of $23.4 million excluding unusual items in 2005, for a 42.4% increase.
Condensed consolidated financial statements for the third quarter and the first nine months of 2006 and 2005, and additional information related to segment revenues and profits are attached to this press release.
Astec's backlog at September 30, 2006 was $125.3 million compared with $72.2 million at September 30, 2005, for a 73% increase.
Commenting on the announcement, Dr. J. Don Brock, Chairman and Chief Executive Officer, stated, "We are pleased with the 15% increase in sales and 160 basis points improvement in gross margin for the third quarter of 2006 over the third quarter of 2005. All segments had increased sales for the quarter and are starting the fourth quarter with greatly improved backlogs totaling $125,000,000.
"Customers in general are busy and oil prices have moderated from their high in the second quarter. Legislation to confirm federal funding for 2007 seems to be firming up pending the return of Congress from recess. State tax receipts seem to be doing well. Interest rates appear to be stabilizing. We are pleased with the business climate as we enter the fourth quarter and prepare for opportunities in 2007. Our backlogs give us confidence regarding continued growth through next year."
Astec Industries, Inc. is a manufacturer of specialized equipment for building and restoring the world's infrastructure. Astec's manufacturing operations are divided into four business segments: aggregate processing and mining equipment; asphalt production equipment; mobile asphalt paving equipment; and underground boring, directional drilling and trenching equipment.