LANCASTER, Pa. – Armstrong World Industries, Inc. (NYSE:AWI) has surpassed analyst expectations for the fourth quarter, reporting adjusted earnings per share (EPS) of $1.22, which is $0.18 higher than the consensus estimate of $1.04. The company's revenue for the quarter also exceeded forecasts, coming in at $312.3 million against the anticipated $305.07 million.
The company's fourth-quarter performance showcased a 2.6% increase in net sales compared to the same period last year, driven by better-than-expected Mineral Fiber volumes and improved Average Unit Value (AUV). However, operating income saw a 6.1% decline, primarily due to acquisition-related expenses. Despite this, adjusted operating income rose by 5%, and adjusted diluted EPS from continuing operations grew by an impressive 13%.
For the full year 2023, Armstrong World Industries enjoyed a 5% increase in net sales, with operating income and adjusted diluted EPS from continuing operations both climbing by 12%. The company's cash flow from operating and investing activities improved by 6%, and adjusted free cash flow saw a significant 19% boost.
Looking ahead, the company has issued guidance for the fiscal year 2024, forecasting net sales growth between 3% to 6% and adjusted EBITDA growth ranging from 5% to 9%. The projected adjusted EPS for FY2024 is set at $5.60 to $5.90, which, at the midpoint, aligns with the analyst consensus of $5.61.
President and CEO Vic Grizzle attributed the robust results to the company's strategic execution and the resilience of its business model. "We delivered record fourth quarter net sales and adjusted EBITDA results, highlighted by adjusted EBITDA margin expansion in both our segments while continuing to face soft market conditions," Grizzle said.
The stock responded positively to the earnings release and guidance, moving up 1%. This uptick reflects investor confidence in the company's performance and future outlook.
Armstrong World Industries continues to focus on delivering profitable growth and value for shareholders, as emphasized by Senior Vice President and CFO Chris Calzaretta. "Our 2024 outlook reflects a laser-focused approach to delivering profitable growth, margin expansion, and adjusted free cash flow growth despite modestly softer economic conditions," Calzaretta stated.
Investors will be keeping a close eye on the company's progress as it navigates the upcoming fiscal year with its strategic initiatives and capital allocation priorities firmly in place.
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