Apogee Enterprises reports increased first-quarter sales

Apogee Enterprises, Inc. (parent company of Chromaluxe), reported first-quarter results for fiscal 2026, ended May 31, 2025. Net sales increased 4.6% to $346.6 million, primarily driven by $22.0 million of inorganic sales from the acquisition of UW Solutions (which includes Chromaluxe). Growth from inorganic sales was partially offset by lower volume in Architectural Glass and a less favorable mix in Architectural Metals.

Gross margin decreased to 21.7% from 29.8% primarily due to restructuring charges of $6.9 million, a less favorable mix, and higher aluminum costs in Architectural Metals, and higher tariff expense in Architectural Services.

Selling, general and administrative (SG&A) expense as a percent of net sales increased 240 basis points to 19.7%, primarily due to restructuring charges of $8.4 million and increased amortization expense associated with the UW Solutions transaction, partially offset by lower long-term incentive expense.

Operating income decreased to $6.9 million, primarily driven by restructuring charges related to Project Fortify Phase 2 of $15.3 million, a less favorable mix and higher aluminum costs in Architectural Metals, higher tariff expense in Architectural Services, and increased amortization expense associated with the UW Solutions transaction, partially offset by lower long-term incentive expense.

Adjusted EBITDA decreased to $34.4 million and adjusted EBITDA margin decreased to 9.9%. The decrease in adjusted EBITDA margin was primarily driven by a less favorable mix and higher aluminum costs in Architectural Metals, as well as higher tariff expense in Architectural Services, partially offset by lower long-term incentive expense.

Net income decreased from net earnings of $31.0 million to a net loss of $2.7 million.

“We are pleased to deliver results ahead of our expectations in the first quarter amid challenging market conditions and year-over-year headwinds,” said Ty R. Silberhorn, Apogee’s Chief Executive Officer. “We are also raising our fiscal year outlook for net sales and adjusted diluted EPS as we build momentum for what we expect will be a stronger second half of the year.

“Although tariffs adversely impacted our first quarter results, we continue to execute our mitigation plans and barring any material change to tariff policies, we expect to be able to substantially mitigate the impact of tariffs on the second half of the fiscal year.

“We also continue to be excited about the opportunities to build a platform for growth in our Performance Surfaces segment. Our recent investments in additional capacity, and the acquisition of UW Solutions, expand our market reach and broaden our product offerings. We are executing a structured integration plan to bring out the best in both businesses. We are encouraged by the early results of the acquisition, and they demonstrate how we can use our balance sheet to acquire assets to set us up for future growth.”

Architectural Metals

Architectural Metals net sales were $128.6 million, compared to $133.2 million, primarily reflecting a less favorable mix, partially offset by higher volume. Adjusted EBITDA was $9.4 million, or 7.3% of net sales, compared to $23.8 million, or 17.9% of net sales. The lower adjusted EBITDA margin was primarily driven by a less favorable mix, higher aluminum costs, unfavorable productivity, and unfavorable sales leverage, partially offset by the impact from higher volume.

Architectural Services

Architectural Services net sales were $106.5 million compared to $99.0 million, primarily due to increased volume. Adjusted EBITDA was $6.1 million, or 5.7% of net sales, compared to $6.6 million, or 6.6% of net sales. The decrease in adjusted EBITDA margin was primarily driven by the impact of higher tariff expense, partially offset by a more favorable mix of projects and favorable sales leverage. Segment backlog² at the end of the quarter was $682.9 million, compared to $720.3 million at the end of the fourth quarter.

Architectural Glass

Architectural Glass net sales were $73.3 million, compared to $86.7 million, primarily reflecting reduced volume due to lower end-market demand. Adjusted EBITDA was $13.4 million, or 18.3% of net sales, compared to $20.2 million, or 23.3% of net sales. The lower adjusted EBITDA margin was primarily driven by unfavorable sales leverage.

Performance Surfaces

Performance Surfaces net sales were $42.3 million, compared to $21.2 million. Net sales included $22.0 million of inorganic sales contribution from the acquisition of UW Solutions. Adjusted EBITDA was $8.0 million, or 18.8% of net sales compared to $5.6 million, or 26.6% of net sales. The lower adjusted EBITDA margin was primarily driven by the dilutive impact of lower adjusted EBITDA margin from UW Solutions, unfavorable mix, and increased corporate allocations expense.

Selected financial results: