Acuity Brands, Inc. (NYSE: AYI) announced fiscal 2019 first quarter results. Net sales increased to USD 9.32 Million, a 10.7% increase compared to a year ago. Operating profit fell to USD 116.4 Million, a detriment of USD 3.8 Million compared to a year ago.
Vernon J. Nagel, Chairman, President, and Chief Executive Officer of Acuity Brands, said, “Our first quarter performance was solid despite continuing inflationary cost pressures. We have taken several actions to address these cost issues, including price increases and productivity improvements. Further, our top line growth this quarter continued our long trend of outpacing the overall growth rates of the markets we serve, and diluted earnings per share rose nearly 17 percent while adjusted diluted earnings per share increased approximately 20 percent. Our significant growth in net sales this quarter was due in large part from continued efforts to expand our customer base and the introduction of new products and solutions. Net sales through our independent sales network, which historically comprises approximately 70 percent of our total net sales, were up 10 percent in the first quarter compared with the year ago period, primarily as demand for lighting solutions used in small and medium sized lighting projects improved as well as continued strong growth for our building management solutions. This was partially offset by continued weak demand for larger non-residential lighting projects as well as continued product substitution to lower priced alternatives for certain lighting products. During the quarter, we implemented two price increases to recover higher costs for both components and other input items due to inflation as well as government tariffs enacted on certain Chinese-sourced finished goods and components. While we believe that some of the increase in net sales was due in part to customers buying products in advance of the effective dates of these announced price increases, it is impossible to quantify the exact impact this had on our first quarter sales growth or the impact from a potential pull-forward of sales from the second quarter.”
Gross profit for the first quarter is USD 367.5 Million, an USD 17.6 Million increase from the previous year of USD 349.9 million primarily due to higher sales volumes and productivity improvements.
Mr. Nagel stated, “We remain cautiously optimistic for fiscal 2019 and do not believe that the demand outlook has meaningfully changed since our prior outlook provided in early October 2018. Our wide and varied base of customers generally remains positive about current year growth prospects. Many customers continue to have record backlogs though they too are concerned about the timing of releases, particularly for larger projects, and the potential impact of tariffs and inflation on overall demand. Third-party forecasts and leading indicators continue to suggest that the North American lighting market, the Company’s primary market, should grow in the low-single digit range in fiscal 2019.”