Company Overview - Fanuc Corp. (FANUY) is a notable stock within the Industrial Products sector, which comprises 190 individual stocks and holds a Zacks Sector Rank of 9 [2] - The Zacks Rank system focuses on earnings estimates and revisions, indicating that Fanuc Corp. currently has a Zacks Rank of 2 (Buy) [3] Performance Analysis - The Zacks Consensus Estimate for Fanuc Corp.'s full-year earnings has increased by 1.4% over the past quarter, reflecting improved analyst sentiment [4] - Year-to-date, Fanuc Corp. has gained approximately 0.9%, outperforming the average return of -1.7% for the Industrial Products sector [4] - In the Industrial Automation and Robotics industry, which includes only 2 stocks, Fanuc Corp. ranks 2 in the Zacks Industry Rank, while the industry has experienced an average loss of 63.9% this year [6] Comparison with Peers - Gorman-Rupp (GRC) is another stock in the Industrial Products sector that has outperformed, with a year-to-date return of 2.1% and a Zacks Rank of 2 (Buy) [5] - Gorman-Rupp belongs to the Manufacturing - General Industrial industry, which has a lower Zacks Industry Rank of 138 and has seen a decline of -0.3% this year [6] Investment Outlook - Investors interested in Industrial Products stocks should monitor both Fanuc Corp. and Gorman-Rupp for their strong performance trends [7]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited consolidated financial statements for Q1 2025 and 2024, covering income, balance sheet, cash flow, and equity, with notes on accounting policies, revenue, debt, and the company's single business segment in pumps and pump systems Consolidated Statements of Income (Q1 2025 vs Q1 2024) | (Dollars in thousands, except per share amounts) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net sales** | $163,948 | $159,268 | | **Gross profit** | $50,332 | $48,394 | | **Operating income** | $22,125 | $20,429 | | **Net income** | $12,128 | $7,884 | | **Earnings per share** | $0.46 | $0.30 | Consolidated Balance Sheet Highlights | (Dollars in thousands) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total current assets** | $224,270 | $220,827 | | **Total assets** | $857,847 | $858,469 | | **Total current liabilities** | $92,684 | $87,527 | | **Total liabilities** | $475,776 | $484,669 | | **Total equity** | $382,071 | $373,800 | Consolidated Statements of Cash Flows (Q1 2025 vs Q1 2024) | (Dollars in thousands) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $21,100 | $10,742 | | **Net cash used for investing activities** | ($3,001) | ($3,854) | | **Net cash used for financing activities** | ($20,648) | ($9,374) | | **Net (decrease) in cash and cash equivalents** | ($2,373) | ($2,746) | Net Sales by End Market (Q1 2025 vs Q1 2024) | End Market | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :--- | :--- | :--- | | Industrial | $32,617 | $33,560 | | Fire | $32,977 | $32,289 | | Agriculture | $19,463 | $20,406 | | Construction | $18,781 | $21,482 | | Municipal | $22,049 | $20,215 | | Petroleum | $6,927 | $5,902 | | OEM | $10,633 | $8,158 | | Repair parts | $20,501 | $17,256 | | **Total net sales** | **$163,948** | **$159,268** | - International sales represented approximately **26% of total net sales** for Q1 2025, up from 24% in Q1 2024[22](index=22&type=chunk) - The company's backlog (remaining performance obligations) was **$217.8 million** as of March 31, 2025, with substantially all expected to be recognized as revenue within one year[23](index=23&type=chunk) - The company operates in a single business segment: the design, manufacture, and sale of pumps and pump systems[49](index=49&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 financial results, noting a **2.9% increase in net sales** to **$163.9 million**, improved gross margin, and a **53.8% rise in net income** to **$12.1 million** due to debt refinancing, supported by a strong backlog and consistent dividends - The company's order backlog was **$217.8 million** at March 31, 2025, compared to $234.2 million a year prior. Incoming orders for Q1 2025 decreased by **0.7%** compared to Q1 2024[56](index=56&type=chunk) Q1 2025 vs Q1 2024 Performance Summary | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $163.9M | $159.3M | +2.9% | | **Gross Profit** | $50.3M | $48.4M | +3.9% | | **Operating Income** | $22.1M | $20.4M | +8.3% | | **Net Income** | $12.1M | $7.9M | +53.8% | | **EPS** | $0.46 | $0.30 | +53.3% | - Net sales growth was primarily driven by the municipal (**+9.1%**), petroleum (**+17.4%**), OEM (**+30.3%**), and repair parts (**+18.8%**) markets, offsetting declines in construction (**-12.6%**) and agriculture (**-4.6%**)[60](index=60&type=chunk)[61](index=61&type=chunk) - Interest expense decreased by **38.4%** to **$6.2 million** from $10.1 million in Q1 2024, primarily due to debt refinancing transactions completed in May 2024[65](index=65&type=chunk) - The Board of Directors authorized a quarterly dividend of **$0.185 per share**, marking the 301st consecutive quarterly dividend[57](index=57&type=chunk)[75](index=75&type=chunk) - The company has **$48.1 million** available for repurchase under its **$50.0 million** share repurchase program as of March 31, 2025[76](index=76&type=chunk) Adjusted EBITDA Reconciliation (Non-GAAP) | (Dollars in thousands) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Reported net income –GAAP basis** | $12,128 | $7,884 | | Interest expense | $6,203 | $10,073 | | Provision for income taxes | $3,408 | $2,200 | | Depreciation and amortization expense | $6,963 | $7,065 | | Non-cash LIFO expense | $995 | $993 | | **Non-GAAP adjusted EBITDA** | **$29,697** | **$28,215** | [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=25&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company identifies primary market risks as interest rate fluctuations on its variable-rate Senior Term Loan Facility, partially mitigated by swaps, and limited foreign currency exchange rate exposure managed by local currency invoicing - The company is exposed to interest rate risk on its **$326.1 million** in borrowings under the Senior Term Loan Facility, which bears interest at a variable rate of Adjusted Term SOFR plus **2.0%** as of March 31, 2025[85](index=85&type=chunk) - To mitigate interest rate risk, the company uses interest rate swap agreements, which are designated as cash flow hedges[86](index=86&type=chunk) - A hypothetical **100 basis point increase** in interest rates is estimated to increase annual interest expense by approximately **$1.8 million**[87](index=87&type=chunk) - Foreign currency risk is primarily limited to the Euro, Canadian Dollar, South African Rand, and British Pound. Foreign currency transaction losses were minimal at **($0.1) million** for Q1 2025[88](index=88&type=chunk) [Item 4. Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[90](index=90&type=chunk) - No changes occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[91](index=91&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=28&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no material changes to legal proceedings from those previously disclosed in its 2024 Annual Report on Form 10-K - There are no material changes from the legal proceedings previously reported in the Company's 2024 Form 10-K[92](index=92&type=chunk) [Item 1A. Risk Factors](index=28&type=section&id=Item%201A.%20Risk%20Factors) This section supplements previously disclosed risk factors, emphasizing the potential adverse effects of U.S. trade policy and tariffs on imported material costs and international sales, which could impact financial results - A supplemental risk factor was added concerning U.S. trade policy. Tariffs could increase the cost of imported materials and adversely affect the company's business and financial results if not properly mitigated[93](index=93&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=28&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company did not repurchase common shares during Q1 2025, with approximately **$48.1 million** remaining available under its authorized share repurchase program as of March 31, 2025 - No shares were purchased as part of the publicly announced repurchase program during the first quarter of 2025[94](index=94&type=chunk) - As of March 31, 2025, approximately **$48.1 million** remained available for repurchase under the authorized program[34](index=34&type=chunk)[76](index=76&type=chunk)[94](index=94&type=chunk) [Item 3. Defaults Upon Senior Securities](index=29&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities during the period - None[96](index=96&type=chunk) [Item 4. Mine Safety Information](index=29&type=section&id=Item%204.%20Mine%20Safety%20Information) This item is not applicable to the company - Not applicable[97](index=97&type=chunk) [Item 5. Other Information](index=29&type=section&id=Item%205.%20Other%20Information) No director or officer adopted or terminated any Rule 10b5-1 trading arrangement during the quarter ended March 31, 2025 - During the quarter ended March 31, 2025, no director or officer of the Company adopted or terminated any Rule 10b5-1 trading arrangement[98](index=98&type=chunk) [Item 6. Exhibits](index=30&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications required by Sarbanes-Oxley Act and financial statements in Inline XBRL format - The report includes CEO and CFO certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[101](index=101&type=chunk) - Financial statements are provided in Inline eXtensible Business Reporting Language (XBRL) format[101](index=101&type=chunk)

Core Viewpoint - Investors are increasingly seeking growth stocks that demonstrate above-average growth potential, with Gorman-Rupp (GRC) identified as a strong candidate due to its favorable growth metrics and Zacks Rank [2][9]. Earnings Growth - Gorman-Rupp has a historical EPS growth rate of 8.7%, but projected EPS growth for this year is expected to be 13.7%, significantly outperforming the industry average of 6.4% [5]. Cash Flow Growth - The company exhibits a year-over-year cash flow growth of 19.3%, which is substantially higher than the industry average of 1.3%. Over the past 3-5 years, Gorman-Rupp's annualized cash flow growth rate has been 10.6%, compared to the industry average of 8.5% [6][7]. Earnings Estimate Revisions - There has been a positive trend in earnings estimate revisions for Gorman-Rupp, with the Zacks Consensus Estimate for the current year increasing by 0.5% over the past month, indicating strong near-term stock price movement potential [8]. Overall Assessment - Gorman-Rupp has achieved a Growth Score of B and holds a Zacks Rank 2, reflecting its strong growth prospects and positive earnings estimate revisions, making it a solid choice for growth investors [9][10].

Investors interested in stocks from the Manufacturing - General Industrial sector have probably already heard of Gorman-Rupp (GRC) and Trimble Navigation (TRMB) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and ...

Exhibit 99 GORMAN-RUPP REPORTS FIRST QUARTER 2025 FINANCIAL RESULTS Mansfield, Ohio – April 24, 2025 – The Gorman-Rupp Company (NYSE: GRC) reports financial results for the first quarter ended March 31, 2025. First Quarter 2025 Highlights Net sales for the first quarter of 2025 were $163.9 million compared to net sales of $159.3 million for the first quarter of 2024, an increase of 2.9% or $4.7 million. Sales increased $1.8 million in the municipal market and $3.2 million in the repair market due to water a ...

Financial Performance - Net sales for 2024 were $659.7 million, a slight increase of 0.1% or $0.2 million from $659.5 million in 2023[103] - Gross profit for 2024 was $204.3 million, with a gross margin of 31.0%, up from $196.3 million and 29.8% in 2023[105] - Operating income increased by 5.1% to $91.4 million in 2024, resulting in an operating margin of 13.9%[108] - Net income for 2024 was $40.1 million, or $1.53 per share, compared to $35.0 million, or $1.34 per share, in 2023, representing a 14.8% increase[111] - Reported net income for 2024 was $40.1 million, an increase of 15.8% from $34.9 million in 2023 and a significant rise from $11.2 million in 2022[115] - Non-GAAP adjusted earnings for 2024 reached $46.0 million, up 28.3% from $35.8 million in 2023 and 87.5% from $24.5 million in 2022[115] - Adjusted earnings per share for 2024 was $1.75, a 27.7% increase from $1.37 in 2023 and a 86.2% increase from $0.94 in 2022[115] Orders and Backlog - The Gorman-Rupp Company's backlog of orders decreased by 5.6% to $206.0 million as of December 31, 2024, compared to $218.1 million in 2023[97] - Incoming orders for the year ending December 31, 2024, increased by 6.8% to $659.3 million compared to 2023[98] Expenses and Cash Flow - Interest expense decreased by 18.5% to $33.6 million in 2024, down from $41.3 million in 2023 due to debt refinancing[109] - Net cash provided by operating activities in 2024 was $69.8 million, a decrease from $98.2 million in 2023[121] - Rental expenses for operating and financing leases were $3.6 million in 2024, up from $2.8 million in 2023[128] Debt and Capital Management - The company had $340.8 million in debt outstanding due in 2029 and $30.0 million due in 2031, remaining compliant with debt covenants[118] - The Company had $340.8 million in borrowings under the Senior Term Loan Facility as of December 31, 2024[155] - The Board of Directors has authorized a share repurchase program of up to $50.0 million, with approximately $48.1 million remaining to be repurchased[127] Dividends and Shareholder Returns - The company declared a quarterly dividend of $0.185 per share, marking the 300th consecutive quarterly dividend payment[99] Pension and Employee Benefits - The company plans to contribute $2.9 million to its defined benefit pension plan in 2025, following a contribution of $5.1 million in 2024[120] - The discount rates used to value pension plan obligations were 5.3% at December 31, 2024, compared to 4.7% at December 31, 2023[138] - The expected rate of return on pension assets was 7.2% for 2024 and 6.2% for 2023[138] Goodwill and Assets - Goodwill relating to the National reporting unit is $13.6 million, or 1.6% of the Company's total assets as of December 31, 2024[147] - Goodwill relating to the Fill-Rite reporting unit is $230.7 million, or 26.9% of the Company's total assets as of December 31, 2024[147] Inventory and Contract Estimates - The Company uses the last-in, first-out (LIFO) method for the majority of its inventories[136] - The Company estimates profit on long-term contracts based on total estimated revenue and expected costs to complete[134] - The Company regularly reviews and updates its contract-related estimates to reflect significant changes[135] Market Conditions and Future Outlook - The company remains focused on benefiting from infrastructure spending and strong demand for flood control and storm water management[101] - A hypothetical increase of 100 basis points in interest rates would increase interest expense by approximately $1.9 million annually[157] - Foreign currency transaction losses for 2024 and 2023 were $(0.4) million each, while gains for 2022 were $0.2 million[158]

Financial Performance - Net sales for Q4 2024 were $162.7 million, an increase of 1.3% or $2.1 million compared to Q4 2023[2] - Net income for Q4 2024 was $11.0 million, or $0.42 per share, compared to $9.0 million, or $0.34 per share in Q4 2023[7] - Full-year 2024 net sales were $659.7 million, a slight increase of 0.1% or $0.2 million from 2023[10] - Full-year 2024 net income was $40.1 million, or $1.53 per share, compared to $35.0 million, or $1.34 per share in 2023[17] - Net sales for Q4 2024 reached $162.704 million, a slight increase from $160.565 million in Q4 2023, while total net sales for the year were $659.667 million compared to $659.511 million in 2023[29] - Net income for Q4 2024 increased to $10.977 million, up from $8.976 million in Q4 2023, resulting in an annual net income of $40.115 million compared to $34.951 million in 2023[29] - Earnings per share for Q4 2024 were $0.42, compared to $0.34 in Q4 2023, with annual earnings per share of $1.53 versus $1.34 in 2023[29] Operational Metrics - Incoming orders for Q4 2024 increased by 15.8% compared to Q4 2023[9] - Adjusted EBITDA for 2024 was $124.6 million, representing an increase of 2.4% from $121.7 million in 2023[20] - Gross profit for 2024 was $204.3 million, resulting in a gross margin of 31.0%, up from 29.8% in 2023[12] - Gross profit for Q4 2024 was $49.193 million, down from $50.937 million in Q4 2023, with a yearly gross profit of $204.328 million compared to $196.253 million in 2023[29] - SG&A expenses for 2024 were $100.5 million, or 15.2% of net sales, compared to $96.7 million, or 14.7% of net sales in 2023[13] Balance Sheet and Cash Flow - Total assets decreased to $858.469 million in 2024 from $890.358 million in 2023, while total liabilities also decreased to $484.669 million from $540.899 million[31] - Cash and cash equivalents at the end of 2024 were $24.213 million, down from $30.518 million at the end of 2023[33] - The company reported a net cash provided by operating activities of $69.830 million for 2024, down from $98.225 million in 2023[33] - Total debt decreased by $43.0 million during 2024, improving leverage[20] - The company experienced a decrease in inventory levels, with net inventories at $99.205 million in 2024 compared to $104.156 million in 2023[31] Strategic Focus and Challenges - The company plans to continue focusing on cost savings and synergies from recent acquisitions, although risks related to integration and performance remain[26] - The company is facing challenges from competitive markets and rising costs of raw materials and labor, which may impact future performance[26] - The backlog of orders was $206.0 million at December 31, 2024, compared to $218.1 million at December 31, 2023[18]

Company Performance - Gorman-Rupp reported quarterly earnings of $0.42 per share, missing the Zacks Consensus Estimate of $0.45 per share, but showing an increase from $0.34 per share a year ago, resulting in an earnings surprise of -6.67% [1] - The company posted revenues of $162.7 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 1.46%, and compared to year-ago revenues of $160.57 million [2] - Over the last four quarters, Gorman-Rupp has surpassed consensus EPS estimates only once and has not beaten consensus revenue estimates during the same period [2] Stock Outlook - Gorman-Rupp shares have declined approximately 0.3% since the beginning of the year, while the S&P 500 has gained 3.4% [3] - The company's earnings outlook is mixed, with the current consensus EPS estimate for the coming quarter at $0.45 on revenues of $164.05 million, and $1.98 on revenues of $683.3 million for the current fiscal year [7] - The current Zacks Rank for Gorman-Rupp is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Industry Context - The Manufacturing - General Industrial industry, to which Gorman-Rupp belongs, is currently ranked in the bottom 39% of over 250 Zacks industries, suggesting potential challenges for stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Gorman-Rupp's stock performance [5]

Group 1 - The Gorman-Rupp Company (NYSE: GRC) is experiencing a recovery in revenue, EBITDA, and net income after a prolonged decline [1] - The recovery in fundamentals is mirrored by an increase in the company's share price [1]

Market Overview - The Nasdaq reached an all-time closing high, but market volatility has increased recently, with the Dow and S&P 500 ending a six-week winning streak due to inflation concerns [1] - The Federal Reserve's recent 50-basis point rate cut was initially welcomed, but inflation data for September has created uncertainty [3][5] - The consumer price index (CPI) rose by 0.2% in September, exceeding the expected 0.1% increase, while year-over-year CPI increased by 2.4%, the smallest rise in over three and a half years [3][4] Dividend-Paying Stocks - In light of market volatility, investors may consider dividend-paying stocks as a stable income source [2][6] - The following companies have announced dividends: - **The Gorman-Rupp Company (GRC)**: Dividend of $0.19 per share with a yield of 1.93%, increased dividends six times in the past five years, payout ratio at 43% [8] - **Kontoor Brands, Inc. (KTB)**: Dividend of $0.52 per share with a yield of 2.60%, increased dividends four times in the past five years, payout ratio at 42% [9] - **West Pharmaceutical Services, Inc. (WST)**: Dividend of $0.21 per share with a yield of 0.26%, increased dividends five times in the past five years, payout ratio at 12% [11] - **Standex International Corporation (SXI)**: Dividend of $0.32 per share with a yield of 0.68%, increased dividends six times in the past five years, payout ratio at 17% [13]