Apogee stock down 13% on 4Q results

The weak economy and depressed commercial construction market continue to punish Apogee Enterprises Inc., whose stock price fell more than 13 percent Thursday after the architectural glass manufacturer posted sharply lower fourth-quarter revenue and earnings.

Bloomington-based Apogee reported the weak results Wednesday after the stock market closed. The stock, which had just hit a 52-week high of $16.76 Tuesday, closed at $14.35 Thursday. The decline translated to a one-day drop of more than $62 million in the company's market capitalization.

Apogee's revenue fell 26 percent to $149 million, while earnings plummeted 95 percent to 2 cents share for the quarter ended Feb. 27. Analysts had estimated earnings per share of 7 to 9 cents.

The company's architectural products and services segment, which accounts for the vast majority of Apogee's business, was the main reason for the disappointing results. Revenue for the unit, which produces and installs glass and windows for commercial and institutional buildings, dropped 30 percent to $131 million, and the business had an operating loss of $3.6 million in the fourth quarter.

In a conference call with analysts, CEO Russell Huffer said the architectural segment has been hit by the economic recession and tight credit markets, which have hurt commercial construction. He said the downturn has been "deeper and longer than we've ever seen before." Revenue from smaller building projects, exports and institutional projects -- some related to the economic stimulus program -- wasn't enough to offset a sharp decline in large building project business, he said.

Huffer also said that the prospects for a rebound anytime soon in the commercial construction market are slim, and that Apogee's revenue is likely to drop another 10 to 15 percent in fiscal 2011.

The architectural segment is expected to post an operating loss, but the company should have an overall profit because of its large-scale optical segment, which makes glass and acrylic custom picture-framing products. The optical segment reported a 13 percent gain in revenue to $18 million and a 2 percent drop in operating earnings to $3.6 million in the fourth quarter.