Powell Industries, Inc. (NASDAQ:POWL) Q1 2025 Earnings Conference Call February 6, 2025 11:00 AM ET Company Participants Ryan Coleman - Alpha IR Brett Cope - Chairman, President & CEO Michael Metcalf - EVP, CFO, Secretary & Principal Accounting Officer Conference Call Participants Alfred Moore - Roth John Franzreb - Sidoti Jon Braatz - Kansas City Capital Operator Good day, and welcome to the Powell Industries Fiscal First Quarter 2025 Earnings Conference Call. All participants will be in a listen-only mode ...

Financial Performance - In Q1 Fiscal 2025, the company reported revenues of $241.4 million, a 24% increase from the previous year, with net income of $34.8 million, or $2.86 per diluted share[91][105]. - Gross profit increased by 24% to $59.5 million, maintaining a gross profit margin of 25%[102]. - Selling, general and administrative expenses increased by 6% to $21.5 million, but as a percentage of revenues decreased to 9%[103]. - The effective tax rate for Q1 Fiscal 2025 was 12%, down from 19% in the same quarter of the previous year[104]. - Operating cash flow provided $37.1 million, influenced by project volume and working capital requirements[112]. Revenue Breakdown - Revenue from the oil and gas market increased by 14% to $95.7 million, while revenue from the electric utility market rose by 26% to $51.2 million[101]. - The order backlog remained at $1.3 billion, with approximately $893 million expected to be recognized as revenue within the next twelve months[92][106]. - Bookings in Q1 Fiscal 2025 increased by 36% to $268.6 million compared to the same period last year[106]. Cash and Investments - Cash, cash equivalents, and short-term investments rose to $373.4 million, up from $358.4 million at the end of the previous fiscal year[108]. Future Plans - The company plans to spend approximately $11 million on a facility expansion project in Houston, scheduled for completion by mid-Fiscal 2025[116].

Core Insights - Powell Industries (POWL) reported quarterly earnings of $2.86 per share, exceeding the Zacks Consensus Estimate of $2.83 per share, and showing an increase from $1.98 per share a year ago, representing an earnings surprise of 1.06% [1] - The company posted revenues of $241.43 million for the quarter ended December 2024, which was below the Zacks Consensus Estimate by 1.12%, but an increase from $194.02 million year-over-year [2] - Powell Industries has outperformed the S&P 500 with a 10.5% gain since the beginning of the year compared to the S&P 500's 3.1% gain [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $3.37, with expected revenues of $277.33 million, and for the current fiscal year, the EPS estimate is $13.70 on revenues of $1.11 billion [7] - The estimate revisions trend for Powell Industries is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6] Industry Context - The Manufacturing - Electronics industry, to which Powell Industries belongs, is currently in the top 34% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Another company in the same industry, Plug Power (PLUG), is expected to report a quarterly loss of $0.23 per share, with revenues projected at $260.18 million, reflecting a year-over-year increase of 17.1% [9]

Exhibit 99.1 PRESS RELEASE For Immediate Release Contact: Michael Metcalf, CFO Powell Industries, Inc. 713-947-4422 Robert Winters or Ryan Coleman Alpha IR Group POWL@alpha-ir.com 312-445-2870 POWELL INDUSTRIES ANNOUNCES FIRST QUARTER FISCAL 2025 RESULTS HOUSTON — February 6, 2025 — Powell Industries, Inc. (NASDAQ: POWL), a leading supplier of custom- engineered solutions for the management, control and distribution of electrical energy, today announced results for the first quarter fiscal 2025 ended Decemb ...

Core Insights - Powell Industries, Inc. reported a strong start to Fiscal 2025 with new order growth of 36% and revenue growth of 24% compared to the same quarter last year [3][4] - The company delivered earnings per diluted share of $2.86, reflecting a 44% increase year-over-year [7][9] - Powell's backlog remained stable at $1.3 billion, indicating sustained demand across various market sectors [6][9] Financial Performance - Revenues for the first quarter totaled $241.4 million, up from $194.0 million in the prior year, but down 12% from $275.1 million in the previous quarter [4] - Gross profit increased to $59.5 million, representing 24.7% of revenue, compared to $48.2 million (24.8% of revenue) in the prior year [5] - Net income rose to $34.8 million, or $2.86 per diluted share, compared to $24.1 million, or $1.98 per diluted share, in the prior year [7][9] Market Activity - New orders reached $269 million, a significant increase from $198 million in the prior year, driven by strong activity in the Oil & Gas and Electric Utility sectors [6] - Revenue from the Oil & Gas sector increased by 14% to $95.7 million, while Electric Utility revenue grew by 26% to $51.2 million, and Commercial & Other Industrial revenue surged by 80% to $44.3 million [4] Strategic Outlook - The company is on track with planned manufacturing capacity upgrades, expected to be completed in mid-Fiscal 2025, which will support organic growth and new product commercialization [8] - Powell's diversification efforts are yielding new opportunities across various markets, including data centers, utilities, carbon capture, and hydrogen [8] - The CFO expressed optimism about maintaining quality and quantity in the backlog, positioning the company for robust revenue and earnings growth throughout Fiscal 2025 [10]

Company Overview - Powell Industries, Inc. is a leading supplier of custom engineered solutions for the management, control, and distribution of electrical energy [2] - The company designs, manufactures, and services custom-engineered equipment and systems for various markets, including utilities, oil and gas producers, refineries, petrochemical plants, pulp and paper producers, mining operations, and commuter railways [2] Financial Announcement - The Board of Directors of Powell Industries has declared a quarterly cash dividend of $0.2675 per share on the company's common stock [1] - This dividend is payable on March 19, 2025, to shareholders of record at the close of business on February 19, 2025 [1]

Core Viewpoint - Powell Industries, Inc. is set to release its first-quarter fiscal 2025 results, with earnings estimates showing a decline in expectations despite projected revenue growth [1][2]. Earnings Estimates - The Zacks Consensus Estimate for fiscal first-quarter earnings is $2.83 per share, reflecting a 6.6% decline over the past 60 days but indicating a 42.9% growth from the previous year [2]. - Revenue estimates stand at $244.2 million, representing a 25.9% increase year-over-year [2]. Earnings Surprise History - Powell has a strong earnings surprise history, exceeding the Zacks Consensus Estimate in the last four quarters with an average surprise of 57.6% [3]. Market Conditions and Growth Drivers - The company's performance is bolstered by favorable conditions in the oil, gas, and petrochemical markets, alongside a growing presence in data centers and electric utilities [4][7]. - Increased demand for electrical power from data centers in the U.S. is driving product demand [8]. Backlog and Orders - Powell's backlog reached $1.3 billion at the end of the fourth quarter of fiscal 2024, supported by a healthy volume of small and medium-sized orders [9]. Facility Expansion - The expansion of the Houston product factory is expected to enhance the company's ability to meet current demand and support volume growth [10]. Cost Challenges - The company faces rising costs of sales and operating expenses, with material costs accounting for 47% of revenues in fiscal 2024 [11]. - Supply-chain constraints for engineered components are anticipated to inflate costs and delay product deliveries [11][12]. Stock Performance - Powell's shares have increased by 193.9% over the past year, outperforming both the industry and the S&P 500 [13]. - The forward 12-month price-to-earnings ratio is 17.03X, below the industry average of 24.60X, indicating potential attractiveness for investors [15]. Investment Thesis - Powell is well-positioned to capitalize on opportunities in oil, gas, and petrochemical markets, with a diversified product portfolio and strong backlog [18]. - However, near-term challenges such as escalating costs and supply-chain issues may impact margin performance [19].

Group 1 - Powell Industries (POWL) closed at $236.37, reflecting a -1.72% change from the previous day, underperforming the S&P 500's 0.53% gain [1] - Over the past month, POWL shares have appreciated by 8.5%, outperforming the Industrial Products sector's gain of 2.99% and the S&P 500's gain of 1.24% [1] - The upcoming earnings report is set for February 6, 2025, with projected EPS of $2.83, indicating a 42.93% increase year-over-year, and revenue expected at $244.17 million, up 25.85% from the prior-year quarter [2] Group 2 - Full-year Zacks Consensus Estimates predict earnings of $13.70 per share and revenue of $1.11 billion, representing year-over-year changes of +11.47% and +9.33% respectively [3] - Recent shifts in analyst projections for Powell Industries are important, as positive estimate revisions are seen as a good sign for the company's business outlook [3][4] - The Zacks Rank system, which includes estimate changes, currently ranks Powell Industries at 4 (Sell), with a stagnant consensus EPS projection over the past 30 days [5] Group 3 - Powell Industries has a Forward P/E ratio of 17.56, which is below the industry average of 22.48, indicating it is trading at a discount [6] - The company has a PEG ratio of 1.25, compared to the industry average PEG ratio of 1.81, suggesting favorable valuation metrics [7] - The Manufacturing - Electronics industry, part of the Industrial Products sector, has a Zacks Industry Rank of 182, placing it in the bottom 28% of over 250 industries [7]

Company Performance - Powell Industries (POWL) closed at $290.80, with a slight increase of +0.12% compared to the previous day, outperforming the S&P 500, which fell by 0.29% [1] - Over the past month, shares of Powell Industries have increased by 25.58%, significantly outperforming the Industrial Products sector's gain of 5.98% and the S&P 500's gain of 2.52% [1] Upcoming Earnings - The earnings report for Powell Industries is anticipated on February 6, 2025, with expected earnings of $2.83 per share, indicating a year-over-year growth of 42.93% [2] - Revenue is projected to be $244.17 million, reflecting a 25.85% increase compared to the same quarter last year [2] Full Year Projections - For the full year, earnings are projected at $13.70 per share and revenue at $1.11 billion, representing increases of +11.47% and +9.33% respectively from the prior year [3] - Recent analyst estimate revisions suggest a positive outlook for Powell Industries, indicating optimism about the company's business trends [3] Valuation Metrics - Powell Industries is currently trading at a Forward P/E ratio of 21.21, which is lower than the industry average of 22.73 [6] - The company has a PEG ratio of 1.51, compared to the Manufacturing - Electronics industry's average PEG ratio of 1.94, suggesting a favorable valuation relative to expected earnings growth [6] Industry Context - The Manufacturing - Electronics industry, part of the Industrial Products sector, holds a Zacks Industry Rank of 141, placing it in the bottom 44% of over 250 industries [7] - Research indicates that industries in the top 50% of the Zacks Industry Rank outperform those in the bottom half by a factor of 2 to 1 [7]

HOUSTON, Jan. 23, 2025 (GLOBE NEWSWIRE) -- Powell Industries, Inc. (NASDAQ: POWL), a leading supplier of custom engineered solutions for the management, control and distribution of electrical energy, today announced that it will release results for the fiscal first quarter ended December 31, 2024 on Thursday, February 6, 2025 after the market closes. In conjunction with the release, Powell Industries has scheduled a conference call, which will be broadcast live within the Investor Relations section of the C ...