Astec Industries, Inc. boosted its second quarter earnings by 17 percent over the same period a year ago but fell below analysts projections, in part, due to rain delays on many paving projects that use Astec equipment.
The Chattanooga-based asphalt and construction equipment maker reported today that it earned $11.1 million, or 48 cents per share, on sales of $248.1 million during the spring quarter. A year ago, Astec earned $9.5 million, or 41 cents per share, on sales of $238.3 million.
Analysts who follow Astec had projected, on average, the company would earn 55 cents per share in the second quarter.
"We were able to reduce our SG&A (selling, general and administrative expenses) compared to the first quarter of 2013 but our gross margin came in below our expectations in the Asphalt Group due to product mix and decreased overhead absorption," Astec CEO Dr. J. Don Brock said in a statement announcing the second quarter results. "Many areas of the Central and Eastern United States have experienced historically high rainfall, delaying construction work. This has also delayed many of our shipments."
But Brock said the industry is picking up in the residential and commercial construction sector.
"With the delayed work for the first half of the year we expect to see their business much stronger in the second half," Brock said. "Hopefully this will improve demand during the fourth quarter and into next year."
Astec also expects future growth in its energy business with its new pellet plant, high tech drill rigs, pump trailers, water heaters and gas processing heaters. But Brock said the fall quarter may show a decline in that sector before a rebound in the fourth quarter.