AZZ Eyes Growth Spurt: Strong Markets Fuel FY25 Sales, Profit Forecast

AZZ Inc. AZZ raised the guidance for FY25 thanks to strength in several end markets. 

The company raised the outlook for sales to $1.525 billion – $1.625 billion (from $1.5 billion- $1.6 billion prior) vs. consensus of $1.568 billion and adjusted EPS to $4.50 – $5.00 (from $4.25 – $4.75 earlier) vs. $4.69 estimate.

The company boosted adjusted EBITDA to $310 million – $360 million from $300 million – $350 million for FY25.

AZZ reiterated its capital expenditures outlook at $100 million – $120 million and expects to further deleverage the company by approximately $60 million – $90 million in the year. 

Tom Ferguson, President, and Chief Executive Officer of AZZ, said, “We again successfully repriced our Term Loan B in March, reducing the interest rate margin by another 50 basis points. In addition, S&P Global recently upgraded the rating on our senior secured debt to ‘BB-‘ from ‘B’ a solid two notch increase. We are gaining confidence in the outlook from our minority interest in the AVAIL joint venture and have increased our estimates of equity income.”

“As we continue to progress through the fiscal year, our focus will be on organic growth within our Metal Coatings and Precoat Metals segments. We intend to grow market share and ensure that superior customer service, quality, and operational excellence remain differentiators for the company.”

The company plans to report fourth-quarter results on April 22, 2024.

Investors can gain exposure to the stock via Ballast Small/Mid Cap ETF MGMT and Gabelli Automation ETF GAST.

Price Action: AZZ shares are up 1.82% at $80.05 premarket on the last check Monday.