Apogee Enterprises Enjoys Over $400 Million in Backlog Projects

By Tami Faram

Apogee Enterprises Inc., headquartered in Minneapolis, is enjoying a surplus in business during its first quarter of 2008, which is a growth that has steadily increased since the end of 2007.

During a recent investor teleconference, Russ Huffer, Apogee chairman and chief executive officer, said he anticipates the company's architectural segment will see an increased operating margin of 6.6 to 6.9 percent, with a continued revenue growth of 11 to 14 percent. He said the company has a backlog of $414 million in the architectural segment, up 15 percent from last year at the same time, yet down slightly at year's end.

"Our architectural segment backlog of $414 million with improving margins supports this level of performance," Huffer said. "Our commercial construction markets continue to be strong based on our backlog, bidding and market forecast. The sectors we serve value our energy-efficient hurricane and blast value-added glass, window and curtainwall products and services."

Other related items Huffer discussed at the first quarter meeting included:

• Final resolution of outstanding legal case (dating back to the late 1990s) relating to a French curtainwall project;
• Company debt increases from $35.4 million to $43.4 million due to distributions of incentives, pensions and taxes;
• Expected increases in 2009 operating margins due to improved company-wide productivity;
• Estimated EBITDA (earnings before interest, taxes, depreciation and amortization) from continuing operations to increase from $83 million to $88 million;
• Net cash increases expected to jump from $55 million to $65 million in 2008; and
• Apogee architectural glass expansions to include picture framing glass coating capacity, spending on productivity improvements and expansions of the window business.

When asked about possible acquisition targets, Jim Porter, Apogee chief financial officer said, "I think we have to look at it business by business. In any enviro cons, architectural, glass business, there are very few candidates that represent themselves as a fit."