Core Points - Standex International Corporation declared a quarterly cash dividend of $0.32 per share, marking a year-on-year increase of approximately 6.7% [1] - This dividend represents the Company's 244th consecutive quarterly cash dividend, with a history of paying dividends since becoming a public corporation in November 1964 [1] Company Overview - Standex International Corporation operates as a global multi-industry manufacturer across five business segments: Electronics, Engraving, Scientific, Engineering Technologies, and Specialty Solutions [2] - The Company has a diverse operational presence in regions including the United States, Europe, Canada, Japan, Singapore, Mexico, Turkey, India, and China [2]

Core Insights - Standex International Corporation announced participation in the 19th Annual Barrington Research Virtual Spring Investment Conference on May 29, 2025 [1] - The presentation will be accessible through the Investor Relations section of Standex's website [1] Company Overview - Standex International Corporation operates as a global multi-industry manufacturer across five business segments: Electronics, Engraving, Scientific, Engineering Technologies, and Specialty Solutions [2] - The company has a diverse operational footprint with locations in the United States, Europe, Canada, Japan, Singapore, Mexico, Turkey, India, and China [2]

Core Viewpoint - Bragar Eagel & Squire, P.C. is investigating potential claims against Standex International Corporation regarding possible breaches of fiduciary duties by its board of directors [1]. Group 1: Investigation Details - The investigation is focused on whether the board of directors of Standex International Corporation has acted in a manner that breaches their fiduciary responsibilities to the company [1]. - Stockholders of Standex are encouraged to reach out if they have information or questions regarding the claims [2]. Group 2: Law Firm Background - Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York and California, representing both individual and institutional investors in various types of litigation [3]. - The firm handles complex litigation in state and federal courts across the country [3].

Financial Performance - Net sales for Q3 FY2025 reached $207.8 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 $22.8 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, while adjusted diluted EPS rose by 3.7% to $1.95[3] - Diluted earnings per share from net income attributable to Standex reported at $1.81 for Q3 2025, a 34.4% increase from $1.35 in Q3 2024[42] - Adjusted diluted earnings per share increased by 3.6% to $1.95 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 $3.41 from $4.54 in the same period of 2024[42] Segment Performance - Fast growth market sales totaled $60.4 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 $111.3 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 $241,538,000 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 $19.3 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 $24.4 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 $10.0 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 $0.9 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 $6.1 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 $25 million and $30 million[23] - The company incurred $477,381,000 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 $493,343,000 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 $82.4 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 $104,830,000 compared to $91,585,000 in 2024[40] - The adjusted EBITDA for the nine months ended March 31, 2025, increased by 13.3% to $119,004,000 compared to $105,076,000 in 2024[40] Restructuring and Acquisition Costs - Total restructuring charges amounted to $0.13 in Q3 2025, down from $0.26 in Q3 2024[42] - Acquisition-related costs increased significantly to $0.14 in Q3 2025 from $0.04 in Q3 2024[42] - Amortization of acquired intangible assets rose to $0.29 in Q3 2025, compared to $0.13 in Q3 2024[42] - Discrete tax items negatively impacted earnings by $(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]

Financial Performance - Net sales for the third quarter of fiscal year 2025 increased by $30.5 million or 17.2% compared to the prior year quarter, driven by acquisitions contributing $46.7 million or 26.3%[135] - Organic sales decreased by $14.4 million or 8.1% due to lower demand in the automotive end market in North America and Europe, partially offset by favorable project timing in the Engineering Technologies segment[135] - Gross profit for the third quarter of fiscal year 2025 increased to $82.4 million, with a gross margin of 39.7%, compared to $68.3 million and 38.5% in the prior year quarter[137] - Net sales for the nine months ended March 31, 2025 decreased by $27.6 million or 5.1% compared to the prior year period, with organic sales down $50.2 million or 9.3%[136] - Gross profit for the nine months ended March 31, 2025 increased to $223.9 million, with a gross margin of 39.4%, compared to $212.5 million and 39.3% in the prior year period[138] - Income from operations for Q3 fiscal year 2025 was $26.3 million, a 20.2% increase from $21.8 million in the prior year quarter, driven by recent acquisitions and productivity improvements[144] - For the nine months ended March 31, 2025, income from operations decreased by $15.8 million, or 21.2%, to $58.8 million, primarily due to lower organic sales[145] Expenses and Costs - Selling, General, and Administrative (SG&A) expenses for the third quarter of fiscal year 2025 were $52.0 million, or 25.1% of sales, up from $41.8 million or 23.6% of sales in the prior year quarter[139] - The company incurred restructuring expenses of $2.0 million in the third quarter of fiscal year 2025, with an expectation of approximately $1.0 million in restructuring costs for the remainder of the fiscal year[141] - Acquisition-related expenses totaled $2.2 million in the third quarter of fiscal year 2025 and $20.4 million in the first nine months of fiscal year 2025[142] - Interest expense for Q3 fiscal year 2025 was $8.4 million, up from $0.9 million in the prior year quarter, with an effective interest rate of 6.00% for the nine months ended March 31, 2025[146] Tax and Compliance - The effective tax rate from continuing operations for Q3 fiscal year 2025 was 29.6%, compared to 21.4% in the prior year quarter, influenced by a discrete tax benefit and jurisdictional mix of earnings[147] - The Company does not anticipate any material non-compliance with environmental laws that would affect future capital expenditures or earnings[198] Strategic Initiatives - The company completed several strategic acquisitions, including McStarlite Co. and Nascent Technology Manufacturing, enhancing its capabilities in aerospace and defense sectors[129] - The company continues to focus on both organic and inorganic growth initiatives to enhance shareholder value and operational efficiency[124] Sales Performance by Segment - Net sales in the Electronics Group for Q3 fiscal year 2025 increased by $30.9 million, or 38.4%, compared to the prior year quarter, with recent acquisitions contributing $38.7 million[153] - Net sales in the Engraving Group decreased by $5.7 million, or 15.7%, in Q3 fiscal year 2025, primarily due to organic sales declines from delays in new platform rollouts[159] - The Scientific Group's net sales increased by $1.4 million, or 8.1%, in Q3 fiscal year 2025, aided by a recent acquisition, despite an organic sales decrease due to NIH funding cuts[164] - Engineering Technologies Group's net sales increased by $7.3 million, or 36.2%, in Q3 fiscal year 2025, reflecting a $5.3 million benefit from a recent acquisition[168] Cash and Debt Management - Total cash balance as of March 31, 2025, was $109.8 million, with $88.8 million held by foreign subsidiaries[180] - Net cash provided by continuing operating activities for the nine months ended March 31, 2025, was $36.2 million, down from $64.6 million in the prior year[181] - As of March 31, 2025, the Company had borrowings of $579.4 million under its credit facility[188] - The Company's Interest Coverage Ratio was 9.42:1, and the leverage ratio was 2.78:1 as of March 31, 2025[186][187] - The Company's effective interest rate on borrowings was 5.63% as of March 31, 2025, with a potential 25-basis point increase in interest rates expected to raise annual interest expense by approximately $1.5 million[204] Risk Management - The Company is exposed to fluctuating market prices for commodities, particularly steel, aluminum, rhodium, and copper, which are critical to its manufacturing processes[206][207] - The Company has implemented proactive risk management techniques to mitigate exposure to market risks from interest rates, commodity prices, and foreign currency exchange[201] - The fair value of the Company's interest rate swaps was an asset of $0.1 million as of March 31, 2025[204] Customer and Supplier Relations - No single customer accounted for more than 5% of the Company's consolidated outstanding receivables or sales as of March 31, 2025, indicating a diversified customer base[205] - The Company does not enter into purchase contracts that extend beyond one operating cycle, minimizing long-term supply risks[206] Labor Relations - The Company has labor agreements with several union locals in the United States and European trade unions, indicating a structured employee relations framework[199]

Financial Data and Key Metrics Changes - Total revenue increased approximately 17.2% year on year to $207.8 million, reflecting a 26.3% benefit from recent acquisitions, partially offset by an organic revenue decline of 8.1% [15][16] - Adjusted operating margin increased 280 basis points year on year to a record 19.4% [15][16] - Adjusted earnings per share increased 3.7% year on year to $1.95 [16] Business Line Data and Key Metrics Changes - **Electronics Segment**: Revenue increased 38.4% year on year to $111.3 million, with a 48.1% benefit from acquisitions, partially offset by an organic decline of 8.9% [17] - **Engraving Segment**: Revenue decreased 15.7% to $30.6 million, driven by an organic decline of 12.6% [19] - **Scientific Segment**: Revenue increased 8.1% to $18.3 million, due to a 16.1% benefit from recent acquisitions, partially offset by an organic decline of 8% [20] - **Engineering Technologies Segment**: Revenue increased 36.2% to $27.4 million, driven by a 26.3% benefit from recent acquisitions and organic growth of 9.9% [21] - **Specialty Solutions Segment**: Revenue decreased 13.9% year on year to $20.2 million, primarily due to general market softness [23] Market Data and Key Metrics Changes - Sales into fast growth markets increased to 29% of total company sales, primarily driven by electrical grid, commercialization of space, defense applications, and renewable energy [7][25] - Electronics organic bookings were up more than 10% year on year, with a book to bill of 0.98 indicating stable markets [5][17] Company Strategy and Development Direction - The company plans to continue investing in key growth priorities and new product developments while navigating tariff impacts through pricing and productivity actions [12][27] - Expansion plans in India, Europe, and the USA are underway, with significant customer commitments extending years into the future [6][12] - The company aims to achieve long-term targets of sales greater than $1.15 billion, adjusted operating margin greater than 23%, and ROIC greater than 15.5% by fiscal 2028 [27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's agility and resilience to navigate current economic challenges, emphasizing strong customer relationships and regional operations [10][12] - The company anticipates slightly to moderately higher revenue in the fiscal fourth quarter driven by recent acquisitions and higher sales into fast growth end markets [8][19] - Management remains optimistic about organic growth in fiscal 2026, particularly in the electronics segment, supported by strong order intake rates [35][51] Other Important Information - The company declared its 243rd consecutive quarterly cash dividend of $0.32 per share, reflecting a 6.7% increase year on year [24] - The integration of recent acquisitions, including McStarlight, is progressing well, expanding the addressable market within engineering technologies by over $300 million [13][14] Q&A Session Summary Question: Impact of tariffs on cost of goods sold - Management confirmed that approximately 6% of COGS is imported from China, split across electronics, specialty, and scientific segments [31] Question: Organic growth expectations for fiscal 2026 - Management indicated that they expect to see organic growth in electronics and engineering technologies, with a strong order book and positive market conditions [35][51] Question: Capacity utilization and margin impact from new plant in Europe - Current capacity utilization is around 60-70%, with no anticipated margin impact from the new plant in Europe [48][50] Question: Plans for new product releases in fiscal 2026 - The company plans to release a similar number of new products in fiscal 2026 as in fiscal 2025, with ongoing adoption expected from products released in 2025 [71] Question: Leverage and debt management strategies - Management emphasized the priority of paying down debt while also focusing on organic growth initiatives [53][56]

Financial Data and Key Metrics Changes - Total revenue increased approximately 17.2% year on year to $207.8 million, reflecting a 26.3% benefit from recent acquisitions, partially offset by an organic revenue decline of 8.1% [16][18] - Adjusted operating margin increased 280 basis points year on year to a record 19.4% [16] - Adjusted earnings per share increased 3.7% year on year to $1.95 [17] - Free cash flow for the third quarter was $3.5 million, down from $19.3 million a year ago, impacted by one-time transaction-related payments and longer customer credit terms [18] Business Line Data and Key Metrics Changes - **Electronics Segment**: Revenue increased 38.4% year on year to $111.3 million, with a 48.1% benefit from acquisitions, partially offset by an organic decline of 8.9% [19] - **Engraving Segment**: Revenue decreased 15.7% to $30.6 million, driven by an organic decline of 12.6% [21] - **Scientific Segment**: Revenue increased 8.1% to $18.3 million, due to a 16.1% benefit from recent acquisitions, partially offset by an organic decline of 8% [22] - **Engineering Technologies Segment**: Revenue increased 36.2% to $27.4 million, driven by a 26.3% benefit from recent acquisitions and organic growth of 9.9% [23] - **Specialty Solutions Segment**: Revenue decreased 13.9% year on year to $20.2 million, primarily due to general market softness [24] Market Data and Key Metrics Changes - Sales into fast growth markets increased to 29% of total company sales, primarily driven by electrical grid, commercialization of space, defense applications, and renewable energy [7][26] - Electronics organic bookings were up more than 10% year on year, with a book to bill ratio of 0.98, indicating stable markets [5][19] Company Strategy and Development Direction - The company plans to continue investing in new product development and applications across markets with growth potential, with 13 new products released year to date [26][28] - The company is expanding its footprint in Europe and the U.S. to support additional demand, with a greenfield site in Europe expected to be operational within six months [6][20] - The company anticipates achieving long-term targets of sales greater than $1.15 billion, adjusted operating margin greater than 23%, and ROIC greater than 15.5% by fiscal 2028 [28] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's agility and resilience to navigate through current economic challenges, emphasizing strong customer relationships and a disciplined approach to pricing and productivity actions [11][28] - The company expects slightly to moderately higher revenue and adjusted operating margin in the fiscal fourth quarter, driven by recent acquisitions and higher sales into fast growth end markets [9][21] Other Important Information - The company declared its 243rd consecutive cash dividend of $0.32 per share, representing a 6.7% increase year on year [25] - The company has a current liquidity of approximately $170 million and net debt of $470.4 million, with a leverage ratio of 2.8 [24][25] Q&A Session Summary Question: What is the impact of tariffs on the company's operations? - Approximately 6% of the cost of goods sold is due to imports from China, split across electronics, specialty, and scientific segments [32] - The company believes it can cover about 70% of the incremental tariff with price and productivity actions in the scientific segment, while other segments are expected to manage better [34][35] Question: What are the expectations for organic growth in fiscal 2026? - Management is optimistic about organic growth in electronics, with a robust order book and expected contributions from recent acquisitions [36][38] Question: What are the plans for new product releases in fiscal 2026? - The company plans to release a similar number of new products in fiscal 2026 as in fiscal 2025, with ongoing adoption expected from products released in 2025 [75] Question: How is the company managing its leverage and potential acquisitions? - The company aims to prioritize paying down debt while also focusing on organic growth initiatives, with a current leverage ratio of about 2.8 [56][58]

Core Viewpoint - Standex International (SXI) reported quarterly earnings of $1.95 per share, exceeding the Zacks Consensus Estimate of $1.93 per share, and showing an increase from $1.75 per share a year ago, indicating a positive earnings surprise of 1.04% [1] Financial Performance - The company achieved revenues of $207.78 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 1.33%, compared to $177.27 million in the same quarter last year [2] - Over the last four quarters, Standex has consistently surpassed consensus EPS estimates four times and topped revenue estimates two times [2] Stock Performance and Outlook - Standex shares have declined approximately 24.4% since the beginning of the year, contrasting with the S&P 500's decline of 5.3% [3] - The company's future stock performance will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] Earnings Estimates - The current consensus EPS estimate for the upcoming quarter is $2.33 on revenues of $220.56 million, and for the current fiscal year, it is $7.86 on revenues of $785.88 million [7] - The estimate revisions trend for Standex is currently mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Manufacturing - General Industrial industry, to which Standex belongs, is currently ranked in the bottom 41% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Financial Performance - Sales increased by 17.2% in Q3 FY25, driven by acquisitions, but partially offset by organic decline[6, 14] - Adjusted gross margin reached a record 42.3% in Q3 FY25, up 230 bps year-over-year[6, 38] - Adjusted operating margin also hit a record 19.4% in Q3 FY25, an increase of 280 bps year-over-year[6, 38] - Adjusted EPS was $1.95[14, 38] Segment Performance - Electronics segment sales increased 38.4% year-over-year, with acquisitions contributing significantly[16, 41] - Engraving segment revenue decreased by 15.7% year-over-year[19, 41] - Scientific segment revenue increased by 8.1% year-over-year[20, 41] - Engineering Technologies segment revenue increased by 36.2% year-over-year[27, 41] Acquisitions and Expansion - Amran/Narayan Group sales exceeded $33 million with a book-to-bill ratio of 1.04[6, 18] - McStarlite acquisition expands the addressable market by over $300 million[8] Outlook - Expect slightly to moderately higher revenue in Q4 FY25, driven by acquisitions and growth in fast-growing markets[6] - New products are expected to contribute over 200 bps of incremental growth in FY25[6, 38]

Core Viewpoint - Standex International Corporation reported strong financial results for the third quarter of fiscal year 2025, with record sales and operating margins, driven by acquisitions and solid performance in core businesses [1][3]. Financial Performance - Net sales increased to $207.8 million, a 17.2% year-over-year increase from $177.3 million [2]. - Operating income on a GAAP basis rose to $26.3 million, up 20.2% from $21.8 million [2]. - Adjusted operating income increased to $40.3 million, reflecting a 37.3% year-over-year growth [2]. - Net income from continuing operations on a GAAP basis was $21.9 million, a 37.6% increase from $15.9 million [2]. - Diluted EPS on a GAAP basis was $1.81, up 35.4% from $1.35 [2]. Segment Performance - Electronics segment revenue reached $111.3 million, a 38.4% increase year-over-year, with a GAAP operating income of $25.5 million [6][7]. - Engraving segment revenue decreased by 15.7% to $30.6 million, primarily due to softness in North America [10][17]. - Scientific segment revenue increased by 8.1% to $18.3 million, benefiting from the Custom Biogenic Systems acquisition [12]. - Engineering Technologies segment revenue grew by 36.2% to $27.4 million, driven by the McStarlite acquisition and organic growth [14]. - Specialty Solutions segment revenue decreased by 13.9% to $20.2 million, reflecting market softness [16]. Strategic Initiatives - The company launched three new products in the third quarter, achieving a total of 13 year-to-date, contributing over 2% to incremental sales [3]. - Standex is focused on managing costs and productivity while investing in strategic growth priorities [3]. - The acquisition of McStarlite is expected to be accretive to earnings in the first year and enhances capabilities in commercial aviation, space, and defense [3]. Outlook - For the fourth quarter of fiscal 2025, the company anticipates slightly to moderately higher revenue and adjusted operating margins, driven by recent acquisitions and pricing initiatives [4][9].