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Standex(SXI) - 2025 Q3 - Quarterly Results
SXIStandex(SXI)2025-05-02 19:55

Financial Performance - Net sales for Q3 FY2025 reached 207.8million,a17.2207.8 million, a 17.2% increase year-over-year and a 9.5% increase quarter-over-quarter[3] - Adjusted operating income was 40.3 million, reflecting a 37.3% increase year-over-year and a 13.8% increase quarter-over-quarter[3] - The company achieved a record adjusted gross margin of 42.3%, up 140 basis points sequentially and 230 basis points year-over-year[5] - Net income from continuing operations for the fiscal third quarter of 2025 was 22.8million,up42.522.8 million, up 42.5% from 15.9 million in the same quarter of 2024[31] - GAAP diluted EPS increased by 35.4% year-over-year to 1.81,whileadjusteddilutedEPSroseby3.71.81, while adjusted diluted EPS rose by 3.7% to 1.95[3] - Diluted earnings per share from net income attributable to Standex reported at 1.81forQ32025,a34.41.81 for Q3 2025, a 34.4% increase from 1.35 in Q3 2024[42] - Adjusted diluted earnings per share increased by 3.6% to 1.95inQ32025comparedto1.95 in Q3 2025 compared to 1.88 in Q3 2024[42] - For the nine months ended March 31, 2025, diluted earnings per share from net income attributable to Standex decreased by 24.8% to 3.41from3.41 from 4.54 in the same period of 2024[42] Segment Performance - Fast growth market sales totaled 60.4million,accountingforapproximately2960.4 million, accounting for approximately 29% of total sales, on track to meet the fiscal year target of 170 million[4] - The Electronics segment reported revenue of 111.3million,a38.4111.3 million, a 38.4% increase year-over-year, with a book-to-bill ratio of 0.98 indicating market stability[8] - The electronics segment saw a significant increase in net sales, rising by 17.2% to 284,939,000 for the nine months ended March 31, 2025, compared to 241,538,000in2024[38]−TheacquisitionofMcStarliteisexpectedtobeaccretivetoearningsinthefirstyearandcontributedtoa36.2241,538,000 in 2024[38] - The acquisition of McStarlite is expected to be accretive to earnings in the first year and contributed to a 36.2% revenue increase in the Engineering Technologies segment[16] Cash Flow and Debt - Free cash flow decreased by 81.9% year-over-year to 3.5 million, reflecting a significant decline from 19.3millioninQ3FY2024[3]−NetcashprovidedbycontinuingoperatingactivitiesforthethreemonthsendedMarch31,2025,was19.3 million in Q3 FY2024[3] - Net cash provided by continuing operating activities for the three months ended March 31, 2025, was 9.6 million, down from 24.4millionintheprioryear′squarter[23]−TheCompanyhadnet(cash)debtof24.4 million in the prior year's quarter[23] - The Company had net (cash) debt of 470.4 million as of March 31, 2025, compared to 10.0millionattheendofthefiscalthirdquarterof2024[23]−FundeddebttoEBITDAratioincreasedto2.8x,reflectinga366.710.0 million at the end of the fiscal third quarter of 2024[23] - Funded debt to EBITDA ratio increased to 2.8x, reflecting a 366.7% increase year-over-year, indicating a significant rise in leverage[3] - Interest expense for the fiscal third quarter of 2025 was 8.4 million, significantly higher than 0.9millioninthesamequarterof2024[31]−TheCompanyexpectsinterestexpensetobeapproximately0.9 million in the same quarter of 2024[31] - The Company expects interest expense to be approximately 9 million in the fiscal fourth quarter of 2025[23] Capital Expenditures and Investments - Capital expenditures in the fiscal third quarter of 2025 were 6.1million,upfrom6.1 million, up from 5.2 million in the same quarter of 2024, with expectations for total capital expenditures in fiscal year 2025 to be between 25millionand25 million and 30 million[23] - The company incurred 477,381,000inexpendituresforacquisitionsduringtheninemonthsendedMarch31,2025,comparedto477,381,000 in expenditures for acquisitions during the nine months ended March 31, 2025, compared to 47,696,000 in 2024[36] - The company reported a net cash used in investing activities of 493,343,000fortheninemonthsendedMarch31,2025,comparedto493,343,000 for the nine months ended March 31, 2025, compared to 53,957,000 in 2024[36] Other Financial Metrics - Gross profit for the fiscal third quarter of 2025 was 82.4million,comparedto82.4 million, compared to 68.3 million in the prior year, reflecting a gross margin improvement[31] - Average diluted shares outstanding increased to 12.1 million in the fiscal third quarter of 2025 from 11.8 million in the same quarter of 2024[31] - Adjusted income from operations for the nine months ended March 31, 2025, increased by 14.5% to 104,830,000comparedto104,830,000 compared to 91,585,000 in 2024[40] - The adjusted EBITDA for the nine months ended March 31, 2025, increased by 13.3% to 119,004,000comparedto119,004,000 compared to 105,076,000 in 2024[40] Restructuring and Acquisition Costs - Total restructuring charges amounted to 0.13inQ32025,downfrom0.13 in Q3 2025, down from 0.26 in Q3 2024[42] - Acquisition-related costs increased significantly to 0.14inQ32025from0.14 in Q3 2025 from 0.04 in Q3 2024[42] - Amortization of acquired intangible assets rose to 0.29inQ32025,comparedto0.29 in Q3 2025, compared to 0.13 in Q3 2024[42] - Discrete tax items negatively impacted earnings by (0.77)inQ32025,whiletherewerenosuchitemsinQ32024[42]−Purchaseaccountingexpensesincreasedto(0.77) in Q3 2025, while there were no such items in Q3 2024[42] - Purchase accounting expenses increased to 0.35 in Q3 2025 from $0.05 in Q3 2024[42] Future Outlook - The company expects slightly to moderately higher revenue in Q4 FY2025, driven by recent acquisitions and higher sales into fast growth end markets[7]