Apogee Enterprises (APOG) investor relations material

Executive summary

• Net sales rose 4.6% year-over-year to $358.2 million, driven by the UW Solutions acquisition and growth in Performance Surfaces and Architectural Services, offset by declines in Glass and Metals.

• Adjusted diluted EPS declined to $0.98, down 31.9% year-over-year, impacted by lower EBITDA and higher interest expense.

• Adjusted EBITDA margin decreased to 12.4% from 15.5%, reflecting lower price/volume, unfavorable mix, and higher costs.

• Operating income fell to $26.9 million, with operating margin down to 7.5%.

• Strategic initiatives, including Project Fortify Phase 2 and Apogee Management System, are underway to drive productivity and cost savings.

Financial highlights

• Q2 net sales reached $358.2 million, up 4.6% year-over-year, with $24.9 million from the UW Solutions acquisition.

• Adjusted EBITDA was $44.4 million, down 16.4% year-over-year; adjusted EBITDA margin at 12.4%.

• Gross margin declined to 23.1% from 28.4% due to higher material, tariff, and health insurance costs.

• Net cash from operating activities was $57.1 million for the quarter; $37.3 million year-to-date.

• $11 million returned to shareholders via dividends in the first half.

Outlook and guidance

• Fiscal 2026 net sales expected between $1.39 billion and $1.42 billion; adjusted diluted EPS guidance revised to $3.60–$3.90, with a $0.35–$0.45 EPS headwind from tariffs.

• CapEx projected at $35 million–$40 million; effective tax rate around 27%.

• Second half net sales and adjusted EPS expected to grow year-over-year, led by Performance Surfaces.

• Project Fortify Phase 2 to incur $24–26 million in pre-tax charges and deliver $13–15 million in annualized pre-tax cost savings by Q4 FY26.

• Guidance lowered for glass and metals due to market headwinds, but year-over-year growth still expected.