Apogee Expects to Complete Exit from Auto Glass Replacement Market, Huffer Says
In an update today on the company's fiscal 2009 guidance, Apogee chairman and chief executive officer Russ Huffer said the company may sell its full interest in its joint venture with PPG Industries, which recently announced it plans to sell its automotive business and services unit to private equity firm Kohlberg & Co.
" Earnings reported in equity in affiliates from our joint venture with PPG will be weaker than expected in the normally strong second quarter due to challenging aftermarket windshield market conditions and cost pressures," says Huffer. "With PPG's agreement to sell a majority interest in its automotive glass and services businesses, expected to close in the next few months, we anticipate exercising our option to sell our full interest in this business-this will be the last step in our strategic exit of the auto replacement glass market. When PPG completes the sale of these businesses, Apogee anticipates receiving cash proceeds of approximately $25 million for its 34 percent interest in PPG Auto Glass."
In addition, Huffer provided an update on the company's fiscal 2009 financial standing.
"For full-year fiscal 2009, Apogee continues to expect earnings from continuing operations of $1.82 to $1.94 per share on revenue growth of 13 to 16 percent, up slightly from prior guidance of 12 to 15 percent growth," says Huffer. "In addition, our fiscal 2010 outlook for 8 percent revenue and 20 percent earnings growth remains achievable based on the visibility resulting from our high backlog and commitment levels, as well as ongoing bidding activity, although in a more competitive environment."
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