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Sep 30, 2020
ADS Q2 2021 Earnings Report
ADS reported strong Q2 fiscal 2021 results with increased net sales and profitability.
Key Takeaways
Advanced Drainage Systems announced a strong second quarter for fiscal year 2021, with net sales increasing by 9.7% to $544.2 million and net income increasing significantly to $80.6 million. The company's adjusted EBITDA also saw a substantial increase of 47.3% to $174.1 million. The company is optimistic about the second half of the fiscal year, expecting normal seasonal patterns and capitalizing on residential development and horizontal construction.
Net sales increased by 9.7% to $544.2 million.
Net income increased to $80.6 million, compared to $8.5 million in the prior year.
Adjusted EBITDA (Non-GAAP) increased 47.3% to $174.1 million.
The company's national presence and exposure to residential end market benefitted the results.
ADS
ADS
ADS Revenue by Segment
Revenue by Segment
Pipe Revenue
CapyFin.comInfiltrator Revenue
CapyFin.comInternational Pipe Revenue
CapyFin.comInternational Allied Products & Other Revenue
CapyFin.comAllied Products & Other Revenue
CapyFin.com Forward Guidance
ADS expects net sales to be in the range of $1.790 billion to $1.840 billion and Adjusted EBITDA to be in the range of $495 million to $515 million for fiscal year 2021. Capital expenditures are expected to be in the range of $80 million to $90 million.
Positive Outlook
- Based on current orderbook and market trends.
- Visibility into the second half of fiscal 2021.
- Strong financial performance in the first half of fiscal 2021.
- Expect volume in the second half of the year to be consistent with the prior year, driven by seasonality.
- Expect modest improvement in year-over-year profitability despite inflationary pressure as well as investments in both capital and our organization to drive future value.
Challenges Ahead
- Guidance does not contemplate any further change in economic conditions due to the COVID-19 pandemic.
- Inflationary pressure.
- Investments in capital.
- Investments in organization to drive future value.
- Uncertainties still exist regarding the broader market environment.
Revenue & Expenses
Visualization of income flow from segment revenue to net income