Insteel(IIIN) - 2025 Q2 - Quarterly Results

Financial Performance - Net earnings for Q2 2025 increased to $10.2 million, or$ 0.52 per diluted share, compared to $6.9 million, or$ 0.35 per diluted share in Q2 2024[3] - Net earnings for the three months ended March 29, 2025, were $10.23 million, up 47.0% from$ 6.94 million in the same period last year[24] - For the first six months of fiscal 2025, net earnings increased to $11.3 million, or$ 0.58 per share, from $8.1 million, or$ 0.41 per share in the same period a year ago[8] Sales and Revenue - Net sales rose 26.1% to $160.7 million from$ 127.4 million in the prior-year quarter, driven by a 28.9% increase in shipments[4] Margins and Costs - Gross margin expanded by 300 basis points to 15.3% from 12.3% in the same quarter last year, reflecting higher shipment volumes and lower unit manufacturing costs[4] Cash Flow and Liquidity - Operating activities used $3.3 million of cash during the quarter, compared to generating$ 1.4 million in the prior year quarter, primarily due to changes in net working capital[5] - Cash and cash equivalents decreased to $28.42 million at the end of March 2025 from$ 83.95 million at the end of March 2024, a decline of 66.1%[24] - The company reported a net cash used for operating activities of $3.32 million for the three months ended March 29, 2025, compared to a net cash provided of$ 1.38 million in the same period last year[24] Capital Expenditures - Capital expenditures for the first six months of fiscal 2025 decreased to $4.9 million from$ 14.2 million in the prior year period[9] - Capital expenditures for the six months ended March 29, 2025, were $4.89 million, down from$ 14.23 million in the same period last year[24] - The company expects capital outlays for fiscal 2025 to total approximately $17.0 million, focusing on cost and productivity improvement initiatives[9] Assets and Liabilities - Total assets increased to$ 421.86 million in December 2025 from $404.70 million in September 2024, reflecting a growth of 4.8%[22] - Accounts receivable increased significantly to$ 79.79 million in December 2025 from $49.44 million in September 2024, a rise of 61.3%[22] - Total current liabilities rose to$ 54.43 million in December 2025, compared to $47.08 million in September 2024, an increase of 15.0%[22] Shareholder Equity - Retained earnings increased to$ 234.65 million in December 2025 from $225.91 million in September 2024, a growth of 3.4%[22] - Total shareholders' equity reached$ 341.41 million in December 2025, up from $331.65 million in September 2024, reflecting an increase of 2.1%[22] Market Outlook - The company is encouraged by strengthening demand and a cautiously positive market outlook, driven by improving business conditions[11] - The expansion of the Section 232 steel tariff to derivative products is expected to reduce the adverse impact of low-priced imports in the U.S. market[12] Business Acquisitions - The company incurred$ 71.46 million in cash outflows for business acquisitions during the six months ended March 29, 2025[24]