On November 21, 2024, Atkore Inc (ATKR, Financial) released its 8-K filing detailing its financial performance for the fourth quarter and fiscal year 2024. Atkore Inc is a diversified industrials company specializing in electrical, mechanical, and safety infrastructure solutions, with significant operations in the United States.
Performance Overview
For the fourth quarter of 2024, Atkore Inc reported a decrease in net sales by $81.6 million, bringing the total to $788.3 million. This represents a 9.4% decline compared to the same period last year. The company's net income also fell significantly by $67.8 million to $73.1 million, while adjusted EBITDA decreased by $91.8 million to $140.2 million. The net income per diluted share dropped to $2.02 from $3.63 in the prior year period.
Financial Achievements and Challenges
Despite the challenges, Atkore Inc managed to achieve annual volume growth of 3.5% across its key product categories. However, the company faced significant headwinds due to pricing normalization and the economic value of solar tax credits, which impacted its revenue and profitability. The decrease in average selling prices was a major factor contributing to the decline in gross profit and margins.
Income Statement Highlights
Net sales for the electrical segment decreased by $85.3 million, or 13.1%, to $564.5 million, primarily due to lower average selling prices. Conversely, the safety and infrastructure segment saw a slight increase in net sales by $4.3 million, or 1.9%, to $224.5 million, driven by higher volumes.
Gross profit for the fourth quarter decreased by $85.4 million to $216.1 million, with gross margins declining from 34.7% to 27.4%. The decrease in gross profit was largely due to the reduction in average selling prices, partially offset by slower declines in raw material costs.
Balance Sheet and Cash Flow
Atkore Inc's net cash provided by operating activities was $549.0 million for fiscal 2024, with free cash flow amounting to $399.2 million. The company repurchased $381.0 million in outstanding shares and paid dividends totaling $34.5 million, reflecting its strong cash flow generation and disciplined capital allocation strategy.
Commentary and Outlook
“Atkore achieved annual volume growth of 3.5% with contributions from each of our key product categories in fiscal 2024,” said Bill Waltz, Atkore President and Chief Executive Officer. “Given the expected decline in net sales and profitability this year, we remained focused on executing our strategic initiatives which we believe will further strengthen our Company for the long-term.”
Looking ahead, Atkore Inc expects full-year 2025 net sales to be in the range of $2.9 to $3.2 billion, with adjusted EBITDA projected between $475 and $525 million. The company remains optimistic about participating in secular trends and is focused on being the customer's first choice despite market challenges.
Conclusion
Atkore Inc's fourth-quarter results reflect the impact of pricing normalization and economic factors on its financial performance. While the company faces challenges, its strategic initiatives and strong cash flow position it well for future growth. Investors and stakeholders will be keen to see how Atkore navigates these challenges and capitalizes on emerging opportunities in the industrial products sector.
Explore the complete 8-K earnings release (here) from Atkore Inc for further details.
