Apogee Enterprises Reports 3.2% Revenue Growth to $1.40 Billion Amid Declining Organic Sales

Apogee Enterprises, Inc. reported a consolidated net sales increase of 3.2% for the fiscal year ending February 28, 2026, reaching $1.40 billion, compared to $1.36 billion in the previous fiscal year. The growth was primarily driven by the acquisition of UW Solutions, which contributed $65.3 million in revenue. However, the company experienced a decline in organic sales, particularly in its Architectural Glass and Metals segments, which faced lower demand. Gross profit decreased to $319.5 million, resulting in a gross margin of 22.7%, down from 26.4% in fiscal 2025, largely due to increased aluminum costs and lower sales volume.

The company’s operating income fell significantly by 28.5% to $84.5 million, with an operating margin of 6.0%, compared to 8.7% in the prior year. Net earnings also declined by 36.4% to $54.1 million, translating to diluted earnings per share of $2.52, down from $3.89. The increase in interest expense, which rose to $14.0 million from $6.2 million, was attributed to a higher average debt balance following the UW Solutions acquisition. Additionally, the company recorded a $9.4 million expense related to an arbitration award in the previous fiscal year, which impacted the prior year’s results.

Strategically, Apogee continued to implement its Project Fortify initiative, aimed at optimizing its operational footprint and enhancing cost efficiencies. The second phase of this project, announced in April 2025, resulted in $27.4 million in pre-tax costs, with expected annualized savings of approximately $26 million. The company also integrated UW Solutions into its Performance Surfaces segment, which saw a 62.1% increase in net sales to $198.0 million, reflecting the successful execution of the acquisition strategy.

Operationally, Apogee's workforce decreased to approximately 4,100 employees as of February 28, 2026, down from 4,500 the previous year. The company reported a backlog of $693.8 million in its Architectural Services segment, a slight decrease from $720.3 million in the prior year. The company’s focus on enhancing customer value and operational excellence is expected to drive future growth, although it remains cautious about market conditions and potential economic headwinds.

Looking ahead, Apogee anticipates continued challenges in the non-residential construction market, influenced by macroeconomic factors such as interest rates and inflation. The company remains committed to its strategic initiatives aimed at improving profitability and operational efficiency while navigating these market dynamics.