Astec sales rise 14 percent but profits drop in quarter

Despite a 14 percent rise in sales in the first quarter, Astec Industries Inc. said its net income in the first three months of 2017 was down 16 percent from a year ago, or 3 cents per share below analysts’ expectations.

The Chattanooga-based asphalt and heavy equipment builder earned $15.1 million, or 65 cents per share, on sales of $318.4 million in the first quarter. A year ago, Astec earned $17.7 million, or 77 cents per share, on sales of $278.7 million.

Despite the drop in earnings, Astec CEO Ben Brock said he was pleased with the results and optimistic about the future with a 14 percent increase in the backlog of orders from a year ago.

“We were able to grow revenues and, as expected, our gross margins were lower than usual, mainly due to new products being manufactured in many of our facilities,” Brock said. “The domestic market remained strong for our Infrastructure Group’s products targeted at the road construction industry.”

Astec shares Tuesday jumped by 3.14 percent, or $1.99 per share, to close at $65.33 per share.