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Astec provides update on wood pellet plant business
 

 
Astec Industries recently released fourth quarter 2017 financial results, providing an update of ongoing pellet

plant activities in Georgia and Arkansas and discussing the company’s future plans as an equipment supplier

to the pellet industry.
 
Astec reported net sales of $312.4 million, down from $326.6 million during the fourth quarter of 2016. Domestic

sales dropped 7.4 percent, from $2.65 million during the final quarter of 2016 to $245.4 million during the same

period of last year. International sales, however, increased 8.7 percent from $61.6 million during the fourth

quarter of 2016 to $67 million during the fourth quarter of 2017.
 
Earnings for the fourth quarter reached $10.9 million, or 47 cents per share, compared to $12.4 million, or 53 per

diluted share, during the same period of 2016.
 
Net sales for the full year 2017 reached $1.185 billion, up 3.3 percent from $1.147 billion in 2016. Domestic sales

were down 1 percent, decrease from $941.3 million in 2016 to $932.3 million in 2017. International sales were up 22.5

percent, from $206.2 million in 2016 to $252.4 million in 2017.
 
Earnings for 2017 reached $37.8 million, or $1.63 per diluted share, compared to $55.2 million, or $2.38 per diluted

share in 2016. Astec said that it initiated significant design upgrades to its customers’ Georgia and Arkansas wood

pellet plants to meet full production rates, which negatively impacted earnings per share by approximately 59 cents

during the third quarter of last year.
 
During an investor call, David Silvious, chief financial officer of Astec, said that fourth quarter pellet plant revenues

reached $5.6 million, down from $70.6 million during the fourth quarter of 2016. For the full year, he said pellet plant

revenues were $8 million, down from $135.2 million in 2016.
 
Benjamin Brock, CEO of Astec, called 2017 an extremely challenging year for the company with regard to the

Georgia and Arkansas wood pellet plants, noting the company took significant charges related to getting the two

facilities installed, up to speed and producing. The company is making good progress at both sites, he added.
According to Brock, Astec has additional pellet projects in the pipeline, but stressed the company will not sign a new

pellet plant order until it has finished activities at the Georgia and Arkansas sites. Given progress at the two sites, he

said the company believes it will be in position to add an order for a new pellet plant in time to deliver one in 2019.

He also stressed that if Astec does get an order for another pellet plant, it will act only as a supplier of equipment in

accordance with the company’s traditional equipment parts and service offerings.


                                                                                                                                                                                                          Source:Biomass Magazine