AZZ incorporated (NYSE:AZZ) Q2 2020 Earnings Conference Call - Preliminary Transcript

Dec 05, 2019 • 11:00 am ET


AZZ incorporated (NYSE:AZZ) Q2 2020 Earnings Conference Call - Preliminary Transcript


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Good morning and welcome to the AZZ, Inc Second Quarter Fiscal Year 2020 Financial Results Conference Call. All participants will be in listen-only mode. (Operator Instructions) Please note this event is being recorded. I would now like to turn the conference over to Joe Dorame. Please go ahead.

Joe Dorame

Thanks, Ben. Good morning and thank you for joining us today to review the financial results of AZZ Inc for the second quarter of fiscal year 2020 ended August 31, 2019. On the call representing the company are Mr. Tom Ferguson, Chief Executive Officer and Mr. Paul Fehlman Chief Financial Officer. After the conclusion of today's prepared remarks we will open the call for question-and-answer session. Please note, there is a slide presentation for today's call, which can be found on AZZ's Investor Relations page under Financial Information at Before we begin with prepared remarks, I'd like to remind everyone certain statements made by the management team of AZZ during this conference call constitute forward

looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Except for the statements of historical fact this conference call may contain forward-looking statements that involve risks and uncertainties, some of which are detailed from time to time in documents filed by AZZ with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the fiscal year ended February 28th, 2019. Those risks and uncertainties include but are not limited to, changes in customer demand and response to products and services offered by the company, including demand by the power generation markets, electrical transmission and distribution markets, the industrial markets and the metal coatings markets. Prices and raw material costs including zinc and natural gas, which are used in the hot-dip galvanizing process changes in the political stability and economic conditions of the various markets that AZZ serves foreign and domestic customer requested delays of shipments, acquisition opportunities, currency exchange rates adequate financing and availability of experienced management and employees to implement the company's growth strategies.

The company can give no assurance to such forward-looking statements will prove to be correct. These statements are based on information as of the date hereof and AZZ assumes no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise. With that said, let me turn the call over to Mr. Tom Ferguson, Chief Executive Officer of AZZ. Tom?

Thomas E. Ferguson

Thanks, Joe. Welcome to our second quarter fiscal year 2020 earnings call. And thank you for joining us this morning. We are pleased with the continued strong performance of our business groups in fiscal year 2020. We generated 6% revenue growth of 38% net income growth versus prior year. Operating margins improved overall 9.4% in spite of about 1 million of tariff and FX impact on the Chinese project shipments during the quarter. Year-to-date, our business is tracking nicely ahead of our plans, which bodes well for the full fiscal year.

Our Energy segment experienced a normally