Wednesday, April 23, 2025
Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Fourth quarter and full year financial results. For fiscal year (FY) 2025, AZZ reported adjusted net income of $156.8 million or $5.20 per share compared to $132.8 million or $4.53 per share during FY 2024 and our estimate of $155.9 million or $5.17 per share. Compared to FY 2024, sales increased 2.6% to $1.578 billion. AZZ generated a 24.3% gross margin as a percentage of sales compared to 23.6% during the prior year. Adjusted EBITDA increased 4.3% to $347.9 million, representing 22.0% of sales compared to 21.7% of sales in FY 2024. Adjusted net income and EPS during the fourth quarter of FY 2025 were $29.6 million and $0.98, respectively, compared to our estimates of $28.8 million and $0.95 per share.
Updating estimates. We project FY 2026 revenue, adjusted EBITDA, and adjusted EPS of $1.676 billion, $381.7 million, and $5.83 respectively. Our FY 2026 estimates reflect a gross margin of $408.7 million or 24.4% of sales. We have assumed the company accelerates debt repayment to lower interest expense to offset the reduction of equity in earnings of unconsolidated subsidiaries caused by the AVAIL JV’s sale of its Electric Products business.
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