ASTE Astec Industries Inc

CHATTANOOGA, Tenn., April 24 /PRNewswire-FirstCall/ -- Astec Industries, Inc. (NASDAQ:ASTE) today reported results for their first quarter ended March 31, 2006. Net income for the first quarter of 2006 was $.50 per diluted share compared to $.33 per diluted share in 2005 for a 51.5% increase. A key factor in the increase was an improvement of 260 basis points in gross profit margin. Revenues for the first quarter of 2006 were $185.7 million compared with $161.6 million for the first quarter of 2005 for a 14.9% increase. Domestic sales accounted for 81.3% and international sales for 18.7% of revenues during the first quarter of 2006 compared to 82.4% for domestic sales and 17.6% for international sales during the first quarter of 2005. The Company reported net income of $10.9 million for the first quarter of 2006 compared to net income of $6.8 million for the first quarter of 2005 for an increase of 60.4%. The Company's backlog at March 31, 2006 was $144.5 million compared to $111.2 million at March 31, 2005 for a 30% increase. Consolidated financial statements for the first quarter ended March 31, 2006 and additional information related to segment revenues and profits are attached as addenda to this press release. Commenting on the announcement, Dr. J. Don Brock, Chairman and Chief Executive Officer, stated, "We are pleased with the increased volumes, improved margins and the net income for the first quarter of 2006. The Company had implemented initiatives striving to increase gross margins in 2005. We are beginning to see the effects of this effort. The gross margin percentage improved in the first quarter of 2006 to 24.3% up from 21.7% in the first quarter of 2005 for an increase of 260 basis points. We will continue to focus on these initiatives and will monitor inflation closely and take the necessary actions to stabilize or increase margins." "The Company believes that its increase in volume is reflective of an improving economy, contribution of new products, and some improvement in market share. With energy and material costs increasing, both new products and recycle equipment are getting attention. We finished the first quarter with a backlog 30% ahead of the prior year." Investor Conference Call and Web Simulcast Astec will conduct a conference call on April 24, 2006, at 10:00 A.M. Eastern Time to review its first quarter results as well as current business conditions. The number to call for this interactive teleconference is (877) 407-9210. International callers should dial (201) 689-8049. Please reference Astec Industries. The company will also provide an online Web simulcast and rebroadcast of the conference call. The live broadcast of Astec's conference call will be available online at the Company's website: http://www.astecindustries.com/investors, Conference Calls Section. An archived webcast will be available for 90 days at http://www.astecindustries.com/. A replay of the conference call will be available through midnight on Monday, May 1, 2006 by dialing (877) 660-6853, or (201) 612-7415 for international callers, Account #286, Conference ID# 199727. A transcription of the conference call will be made available under the Investor Relations section of the Astec Industries, Inc. website within 5 days after the call. 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. The information contained in this press release contains "forward-looking statements" (within the meaning of the Private Securities Litigation Reform Act of 1995) regarding the future performance of the Company, including statements about the Company's financial performance for the second quarter and future generally, the ability to stabilize or increase margins, the improving economy, the contribution of new products, and the Company's improvement in market share. These forward-looking statements reflect management's expectations and are based upon currently available information, and the Company undertakes no obligation to update or revise such statements. These statements are not guarantees of performance and are inherently subject to risks and uncertainties, many of which cannot be predicted or anticipated. Future events and actual results, financial or otherwise, could differ materially from those expressed in or implied by the forward-looking statements. Important factors that could cause future events or actual results to differ materially include: general uncertainty in the economy, downturns in the general economy or the commercial construction industry, cyclical nature of the commercial, construction industry and the customization of the equipment the Company sells, increases in the price of oil or decreases in the availability of oil, increases in the price of raw materials, a failure to comply with covenants in the Company's amended credit agreement, contingent liability for certain customer debt, rising interest rates, rising steel and steel component pricing, delayed or decreased funding for highway construction and maintenance, managing and expanding in international markets, the timing of large contracts, production capacity, general business conditions in the industry, demand for the Company's products, seasonality of sales volumes, competitive activity and those other factors listed from time to time in the Company's reports filed with the Securities and Exchange Commission, including but not limited to the Company's annual report on Form 10-K for the year ended December 31, 2005. Astec Industries, Inc. and Subsidiaries Consolidated Balance Sheets (In thousands) (Unaudited) March 31 March 31 2006 2005 Assets Current Assets Cash and cash equivalents $20,856 $9,426 Receivables, net 78,025 65,227 Inventories 148,167 130,059 Prepaid expenses and other 13,215 16,452 Total current assets 260,263 221,164 Property and equipment, net 99,453 97,985 Other assets 24,647 29,708 Total assets $384,363 $348,857 Liabilities and shareholders' equity Current liabilities Revolving credit loan $- $15,393 Current maturities of long-term debt - 3,310 Accounts payable - trade 46,181 43,551 Other accrued liabilities 61,978 51,388 Total current liabilities 108,159 113,642 Long-term debt, less current maturities - 24,655 Other non-current liabilities 15,636 11,282 Minority interest in consolidated subsidiary 606 530 Total shareholders' equity 259,962 198,748 Total liabilities and shareholders' equity $384,363 $348,857 Astec Industries, Inc. and Subsidiaries Consolidated Statements of Income (In thousands) (Unaudited) Three Months Ended March 31 2006 2005 Net sales $185,724 $161,635 Cost of sales 140,584 126,602 Gross profit 45,140 35,033 Selling, general, administrative & engineering expenses 27,759 22,971 Income from operations 17,381 12,062 Interest expense 430 1,180 Other income, net of expense 296 38 Income before income taxes and minority interest 17,247 10,920 Income taxes 6,347 4,106 Minority interest in earnings 3 22 Net income $10,897 $6,792 Earnings per Common Share Net income: Basic $0.51 $0.34 Diluted $0.50 $0.33 Weighted average common shares outstanding Basic 21,194,708 19,899,819 Diluted 21,897,073 20,415,669 Astec Industries, Inc. and Subsidiaries Segment Revenues and Profits For the three months ended March 31, 2006 and 2005 (in thousands) (Unaudited) Aggregate Mobile and Asphalt Under- Asphalt Mining Paving ground All Group Group Group Group Others Total 2006 Revenues 55,732 71,262 36,353 22,377 - 185,724 2005 Revenues 53,535 57,845 28,807 21,448 - 161,635 Change $ 2,197 13,417 7,546 929 - 24,089 Change % 4.1% 23.2% 26.2% 4.3% - 14.9% 2006 Gross Profit 14,562 17,210 9,253 4,220 (106) 45,139 2006 Gross Profit % 26.1% 24.2% 25.5% 18.9% - 24.3% 2005 Gross Profit 10,657 13,601 7,015 3,774 (14) 35,033 2005 Gross Profit % 19.9% 23.5% 24.4% 17.6% - 21.7% Change 3,905 3,609 2,238 446 (92) 10,106 2006 Profit (Loss) 8,293 7,982 4,932 302 (10,424) 11,085 2005 Profit (Loss) 5,656 5,184 3,430 157 (7,549) 6,878 Change $ 2,637 2,798 1,502 145 (2,875) 4,207 Change % 46.6% 54.0% 43.8% 92.4% (38.1%) 61.2% Segment revenues are reported net of intersegment revenues. Segment gross profit is net of profit on intersegment revenues. A reconciliation of total segment profits to the Company's consolidated net income is as follows: For the three months ended March 31 2006 2005 Total profit for all segments 11,085 6,878 Minority interest in earnings of subsidiary (3) (22) Elimination of intersegment profit (185) (64) Consolidated net income 10,897 6,792 Astec Industries, Inc. and Subsidiaries Backlog by Segment March 31, 2006 and 2005 (in thousands) (Unaudited) Aggregate Mobile and Asphalt Under- Asphalt Mining Paving ground All Group Group Group Group Others Total 2006 Backlog 44,744 77,829 5,713 16,195 - 144,481 2005 Backlog 37,803 55,954 10,075 7,339 - 111,171 Change $ 6,941 21,875 (4,362) 8,856 - 33,310 Change % 18.4% 39.1% (43.3%) 120.7% - 30.0% DATASOURCE: Astec Industries, Inc. CONTACT: J. Don Brock, Chairman of the Board & C.E.O., +1-423-867-4210, or fax, +1-423-867-4127, or , or F. McKamy Hall, Vice President and Chief Financial Officer, , or Stephen C. Anderson, Director of Investor Relations, , or +1-423-899-5898, or fax, +1-423-899-4456, all of Astec Industries, Inc. Web site: http://www.astecindustries.com/ http://www.astecindustries.com/investors

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