Net sales climb 5.5% in Enerpac's fourth quarter
Enerpac Tool Group Corp. reported fourth quarter net sales were $167.5 million, a 5.5% increase compared to the prior year, with a 1.8% decrease in organic sales.
“I am proud of the investments we have made and actions we have taken in fiscal 2025 to continue to enhance business operations and the power of the Enerpac brand,” said President and CEO Paul Sternlieb. “In what remains a challenging macro-environment for the general industrial marketplace, the company posted record revenue, maintained industry-leading margins, generated strong cash flow, and returned $71 million to investors through share repurchases and dividends while preserving an extremely strong balance sheet and financial flexibility. Moreover, the integration of the acquired DTA business is fully on track, with an excellent sales funnel as we cross-sell its technology to legacy Enerpac customers.”
Highlights included:
- Operating profit margin was 23.8% and adjusted operating profit margin was 24.0%.
- Net earnings were $28.1 million, or $0.52 per diluted share. Adjusted net earnings were $27.9 million, or $0.52 per diluted share. Diluted earnings per share and adjusted diluted earnings per share increased 21% and 4%, respectively.
- Adjusted EBITDA was $44.5 million, an increase of 15% year-over-year. Adjusted EBITDA margin was 26.5%, an increase of 220 basis points.
Fiscal 2025 Consolidated Results from Continuing Operations Comparisons
Consolidated net sales were $616.9 million compared to $589.5 million in the prior-year period, an increase of 4.6%. On an organic basis, sales increased 1.0% year-over-year, driven by Industrial Tools & Services segment (IT&S) organic growth of 0.5% and 14.8% growth at Cortland Biomedical.
Net sales for IT&S increased 4.3%, driven by the acquisition of DTA and organic growth. On an organic basis, IT&S product revenue and service revenue increased 0.3% and 1.3%, respectively.
Gross profit margin declined 60 basis points year-over-year to 50.5% driven by service margins and the inclusion of DTA, partially offset by stronger margins at Heavy Lifting Technology (HLT) and Cortland Biomedical.
Selling, general and administrative expenses (SG&A) of $172.8 million decreased $3.2 million year-over-year. The decrease in SG&A expense was driven primarily by the absence of ASCEND-related charges in fiscal 2025. Adjusted SG&A expense, excluding ASCEND, restructuring, and M&A charges in both periods, increased $3.1 million to $165.5 million, but declined as a percentage of revenues as the Company continues to optimize SG&A efficiency.
Fiscal 2025 net earnings and diluted EPS were $92.7 million and $1.70 respectively, compared to $82.2 million and $1.50, respectively, in fiscal 2024.
Fiscal 2025 adjusted EBITDA was $153.6 million compared to $147.5 million in fiscal 2024, an increase of 4%. The adjusted EBITDA margin of 24.9% was roughly flat year-over-year.
Net cash provided by operating activities was $111.3 million in fiscal 2025, compared to $81.3 million in fiscal 2024. The increase in cash from operations was driven by improvements in working capital and higher net earnings. Capital expenditures for fiscal 2025 were $19.3 million, an increase of $7.9 million, primarily related to the build-out of the company’s new global headquarters in downtown Milwaukee.
Fourth Quarter Fiscal 2025 Consolidated Results Comparisons
Consolidated net sales for the fourth quarter of fiscal 2025 were $167.5 million compared to $158.7 million in the prior-year period, an increase of 5.5%. On an organic basis, sales decreased 1.8% year-over-year, driven by IT&S organic decline of 2.2%, partially offset by 10.4% growth at Cortland Biomedical.
Net sales for the IT&S segment increased 5.4%, driven by the acquisition of DTA. On an organic basis, IT&S product revenue and service revenue declined 1.0% and 7.4%, respectively.
Gross profit margin returned to normalized levels at 50.1% in the fourth quarter as compared to 48.8% in the prior-year period. The fourth quarter of fiscal 2024 gross profit margin was negatively impacted by service and HLT.
SG&A of $42.1 million decreased $4.5 million year-over-year. SG&A expense in the year-ago period included restructuring charges of $3.0 million and ASCEND charges of $2.1 million. Adjusted SG&A expense was $41.8 million, up slightly from $41.3 million in the year-ago period.
Fourth quarter fiscal 2025 net earnings and diluted EPS were $28.1 million and $0.52 respectively, compared to $23.4 million and $0.43, respectively, in the year-ago period.
Fourth quarter adjusted EBITDA was $44.5 million compared to $38.6 million in the year-ago period. Adjusted EBITDA margin improved 220 basis points year-over-year to 26.5%.
Outlook
“We believe with our strong brand and operating model we can continue to outperform the market and drive profitable growth in 2026,” said Sternlieb.
The company is introducing its fiscal 2026 guidance, including net sales of $635 million to $655 million, based on organic growth of 1% to 4%. The Company also forecasts adjusted EBITDA of $158 million to $168 million, adjusted EPS of $1.85 to $2.00, and free cash flow of $100 million to $110 million. This guidance is based on the company’s key foreign exchange rate assumptions and assumes no substantial change to the current tariff or regulatory environment.
INDUSTRIAL SUPPLY MAGAZINE
The September/October issue of Industrial Supply magazine features an in-depth cover story about American Producers Supply. Plus, we're featuring articles by contributing writers Dr. Bharani Nagarathnam and Frank Hurtte, as well as interviews with numerous product and distribution industry experts.
