Loading...
•
May 31, 2020
Acuity Brands Q3 2020 Earnings Report
Acuity Brands' third quarter results for fiscal year 2020 were announced, reflecting the impact of the COVID-19 pandemic on sales volume, while gross margins expanded and cash generation remained strong.
Key Takeaways
Acuity Brands reported a decrease in net sales by 18.1% compared to the prior-year period, primarily due to a decrease in volume attributed to the COVID-19 pandemic. However, the company expanded gross margins and generated cash through strategic actions taken before and during the pandemic.
Net sales decreased by 18.1% due to a 20% decrease in volume, offset by a 2% benefit from acquisitions.
Gross profit margin increased by 170 basis points due to lower input costs and contributions from acquisitions.
Operating profit margin decreased by 200 basis points, while adjusted operating profit margin decreased by 80 basis points.
Diluted EPS decreased by 31.5%, and adjusted diluted EPS decreased by 23.3% compared to the prior-year period.
Acuity Brands
Acuity Brands
Forward Guidance
Acuity Brands anticipates continued uncertainty around demand and economic recovery, expecting pricing pressure and ongoing tariff-related costs in the fourth quarter of fiscal 2020. The company plans to balance cost management with investments in its transformation and leverage its new product portfolio to capitalize on demand recovery.
Positive Outlook
- Company demonstrates durability of business.
- Company shows continued ability to generate cash
- Company plans to continue to balance the management of our costs with the investment in our transformation
- Company has a robust new product portfolio
- Company portfolio is positioned to benefit from a recovery in demand
Challenges Ahead
- Great uncertainty around demand.
- Uncertainty around the timing of any economic recovery.
- Company expects pricing pressure in the fourth quarter of fiscal 2020.
- Company anticipates continued costs related to tariffs in the fourth quarter of fiscal 2020.
- The pandemic had negative impact on demand.