Exceeds Q3 Earnings Guidance, Achieving GAAP EPS of $0.64 and Adjusted EPS of $0.67;

Revises Full Year Revenue and Narrows Earnings Guidance

BUFFALO, N.Y.--(BUSINESS WIRE)--Nov. 3, 2017-- Gibraltar Industries, Inc. (Nasdaq: ROCK), a leading manufacturer and distributor of building products for industrial, infrastructure, residential, and renewable energy and conservation markets, today reported its financial results for the three- and nine-month periods ended September 30, 2017. All financial metrics in this release reflect only the Company’s continuing operations unless otherwise noted.

Third-quarter Consolidated Results

Gibraltar reported the following consolidated results:

The Company reported third-quarter 2017 net sales of $275 million, attaining the lower end of the Company’s expectations of $275 million to $280 million as noted in its second-quarter earnings release. The 1 percent year-over-year sales increase was driven primarily by sales in the Residential and Renewable Energy & Conservation segments and the effect of its recent acquisitions, which offset the impact of the exit of the U.S. bar grating product line and its European residential solar racking business at the end of 2016, which provided $17 million in sales in the third quarter of 2016, as well as lower infrastructure activity. GAAP and adjusted earnings exceeded Company guidance due to the strong performance of the Residential Products business, improving margins in the Renewable Energy & Conservation space, and the benefit of lower corporate costs related to compensation plans.

The adjusted amounts for the third-quarter 2017 and 2016 remove special items from both periods, as described in the appended reconciliation of adjusted financial measures.

Management Comments

“We delivered another quarter of solid results as we continue to build positive momentum at Gibraltar,” said President and CEO Frank Heard. “We exceeded our GAAP and adjusted earnings guidance, reporting a 49% increase in GAAP EPS and a 22% increase in adjusted EPS. Earnings growth outpaced the increase in sales, which were in line with guidance, as a result of the success of our value creation strategy.

“During the quarter, we made excellent progress on our four-pillar strategy, as we achieved a number of notable accomplishments,” added Heard. “We delivered 190 basis points of margin improvement from 80/20 simplification projects, our innovation efforts are resulting in new product development successes across Gibraltar’s businesses, and the integration of the Nexus and Package Concierge acquisitions are generating improved financial results and enhancing Gibraltar’s long-term competitive position.”

Third-quarter Segment Results

Residential Products

For the third quarter, the Residential Products segment reported:

The 10 percent increase in third-quarter 2017 net sales in Gibraltar’s Residential Products segment reflects improvement in the repair and remodel and new housing construction markets, growing demand for the Company’s commercial package solutions, and the contribution of the Package Concierge acquisition.

Strong demand for electronic package lockers, as well as the benefit of 80/20 initiatives contributed to the segment’s GAAP and adjusted operating margin improvement. The adjusted operating margin for the third quarter of 2017 and 2016 removes the special charges for restructuring initiatives under the 80/20 program from both periods.

Industrial & Infrastructure Products

For the third quarter, the Industrial & Infrastructure Products segment reported:

Third-quarter 2017 revenues in Gibraltar’s Industrial & Infrastructure Products segment were down, with 94 percent of the decline driven by the 2016 divestiture of the U.S. bar grating product line. The remaining decline reflects lower activity in the infrastructure marketplace. Backlog and bookings for the infrastructure business increased year over year and the Company expects continued backlog improvement for the remainder of 2017 as the infrastructure market recovers. The Company also expects new products in the industrial business to continue to gain traction during the fourth quarter of 2017.

GAAP and adjusted operating margins for the segment were affected by lower volumes and continue to reflect less favorable alignment of material costs to customer selling prices. GAAP operating margin in 2016 reflects restructuring charges. This segment’s adjusted operating margin for the third quarter of 2017 and 2016 removes the special charges for portfolio management activities and restructuring initiatives under the 80/20 program.

Renewable Energy & Conservation

For the third quarter, the Renewable Energy & Conservation segment reported:

Renewable Energy & Conservation segment revenues were up 7 percent year over year due to the addition of the recently acquired Nexus business and an increase in the Company’s domestic markets, which offset a decline in international revenues and the exit of the European solar market. Segment backlog increased both sequentially and year over year on a proforma basis.

While improving significantly from the second-quarter 2017 and approaching its target margin profile, the third-quarter 2017 GAAP and adjusted operating margin still reflects a less favorable alignment of material costs to customer selling prices. This segment’s adjusted operating margin for the third quarter of 2017 removes the special charges for restructuring initiatives under the Company’s 80/20 program and portfolio management activities.

Business Outlook

“Looking ahead, we continue to expect generally favorable market conditions for each of our segments, and increased bidding activity and continued backlog growth in our Industrial & Infrastructure and Renewable Energy & Conservation segments. While we see reason for some caution in certain of our end markets, we are optimistic about the final quarter of the year and are narrowing full-year earnings guidance within our previous guidance range.

“For the fourth quarter of 2017 our priorities will be to accelerate new product development initiatives, seek value-added acquisitions in attractive end markets, and advance 80/20 projects. We expect that the execution of our five-year strategy and the continued success of these initiatives will build sustainable long-term value for our shareholders,” concluded Heard.

The Company is adjusting its full-year revenue guidance in the range of $960 million and $965 million. The Company is narrowing its full-year earnings guidance and expects GAAP EPS to be between $1.40 and $1.47 per diluted share, or $1.60 to $1.67 on an adjusted basis. In 2016, GAAP EPS was $1.05, or $1.67 on an adjusted basis. While year-over-year adjusted earnings are projected to be essentially flat, the Company continues to expect increasing return on invested capital and liquidity.

For the fourth quarter of 2017, the Company is expecting revenue in the range of $231 million to $236 million, and GAAP EPS to be between $0.23 and $0.30 per diluted share, or $0.29 to $0.36 per diluted share on an adjusted basis.

Third-quarter Conference Call Details

Gibraltar has scheduled a conference call today starting at 9:00 a.m. ET to review its results for the third quarter of 2017. Interested parties may access the call by dialing (877) 407-5790 or (201) 689-8328. The presentation slides that will be discussed in the conference call are expected to be available this morning, prior to the start of the call. The slides may be downloaded from the Gibraltar website: www.gibraltar1.com. A webcast replay of the conference call and a copy of the transcript will be available on the website following the call.

About Gibraltar

Gibraltar Industries is a leading manufacturer and distributor of building products for industrial, infrastructure, residential, and renewable energy and conservation markets. With a four-pillar strategy focused on operational improvement, product innovation, acquisitions and portfolio management, Gibraltar’s mission is to drive best-in-class performance. Gibraltar serves customers primarily throughout North America and to a lesser extent Asia. Comprehensive information about Gibraltar can be found on its website at www.gibraltar1.com.

Safe Harbor Statement

Information contained in this news release, other than historical information, contains forward-looking statements and is subject to a number of risk factors, uncertainties, and assumptions. Risk factors that could affect these statements include, but are not limited to, the following: the availability of raw materials and the effects of changing raw material prices on the Company’s results of operations; energy prices and usage; changing demand for the Company’s products and services; changes in the liquidity of the capital and credit markets; risks associated with the integration and performance of acquisitions; and changes in interest and tax rates. In addition, such forward-looking statements could also be affected by general industry and market conditions, as well as general economic and political conditions. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law or regulation.

Non-GAAP Financial Data

To supplement Gibraltar’s consolidated financial statements presented on a GAAP basis, Gibraltar also presented certain adjusted financial data in this news release. Adjusted financial data excluded special charges consisting of gains/losses on sales of assets, restructuring primarily associated with the 80/20 simplification initiative, acquisition-related items, and other reclassifications. These adjustments are shown in the non-GAAP reconciliation of adjusted financial measures excluding special charges provided in the supplemental financial schedules that accompany this news release. The Company believes that the presentation of results excluding special charges provides meaningful supplemental data to investors, as well as management, that are indicative of the Company’s core operating results and facilitates comparison of operating results across reporting periods as well as comparison with other companies. Special charges are excluded since they may not be considered directly related to the Company’s ongoing business operations. These adjusted measures should not be viewed as a substitute for the Company’s GAAP results, and may be different than adjusted measures used by other companies.

Next Earnings Announcement

Gibraltar expects to release its financial results for the three-month and full-year periods ending December 31, 2017, on Thursday, February 22, 2018, and hold its earnings conference call later that morning, starting at 9:00 a.m. ET.

View source version on businesswire.com: http://www.businesswire.com/news/home/20171103005334/en/

Source: Gibraltar Industries, Inc.

Gibraltar Industries, Inc.
Timothy Murphy, 716-826-6500 ext. 3277
Chief Financial Officer
tfmurphy@gibraltar1.com