Zurn Elkay Water Solutions Earnings Call Transcripts
Fiscal Year 2026
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Q3 sales rose 9% and adjusted EBITDA grew 15%, with margin up 150 bps. FY 2026 EBITDA guidance increased; 2027 growth is expected despite a softer market, supported by share gains, adjacencies, and 40%+ incremental margins.
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Q2 2026 saw 10% organic sales growth and record EBITDA margins, driven by strong performance in Water Safety, Drinking Water, and Flow Systems. The Intellihot acquisition expands the addressable market, and full-year guidance for sales, EBITDA, and free cash flow has been raised.
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First quarter 2026 saw 11% organic sales growth, 18% adjusted EBITDA growth, and margin expansion, driven by strong performance in Drinking Water and Water Safety & Control. Guidance for Q2 remains robust, with ongoing focus on productivity, capital allocation, and managing tariff risks.
Fiscal Year 2025
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Q4 2025 saw 10% organic sales growth, 14% adjusted EBITDA growth, and strong free cash flow, with leverage at a record low. 2026 guidance calls for mid-single-digit core sales growth, 35% incremental EBITDA margins, and $335 million in free cash flow, with continued focus on organic and inorganic growth opportunities.
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Q3 delivered 11% organic sales growth and record EBITDA margins, with strong free cash flow supporting increased dividends and share repurchases. Full-year guidance was raised, and the company completed its U.S. pension plan termination, while maintaining a positive outlook for 2026 despite tariff and market uncertainties.
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Q2 delivered 8% organic sales growth, 13% adjusted EBITDA growth, and record margins, prompting a raised full-year outlook. All product categories grew, with strong momentum in filtration and non-residential markets, while tariff risks moderated and cash flow hit new highs.
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Q1 2025 delivered 5% organic growth and 110 bps EBITDA margin expansion, with strong cash flow and minimal tariff impact. Supply chain restructuring is reducing China exposure, and full-year guidance is affirmed despite ongoing tariff uncertainty.
Fiscal Year 2024
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Fourth quarter and full-year results exceeded guidance, with strong margin expansion and free cash flow. 2025 outlook anticipates similar core sales growth, robust EBITDA, and continued capital allocation flexibility, while monitoring tariff and macroeconomic uncertainties.
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Q3 results exceeded guidance with 4% core growth and 9% adjusted EBITDA growth, driving margin expansion and a raised full-year outlook. Strong cash flow enabled increased dividends and share repurchases, while legislative and market tailwinds support continued growth into 2025.
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Q2 2024 saw 3% core sales growth and 20% adjusted EBITDA growth, with margins reaching a record 25.3%. Full-year guidance was raised for EBITDA margin and free cash flow, while strong performance in institutional and drinking water segments offset commercial headwinds.