Advanced Drainage Systems(WMS) - 2025 Q3 - Quarterly Results

Financial Performance - Net sales increased by $28.2 million, or 4.3%, to $690.5 million compared to $662.4 million in the prior year quarter[3] - Infiltrator sales increased by $31.4 million, or 30.3%, to $135.3 million, with organic revenue growth of 5.8% excluding the acquisition of Orenco[3] - Year-to-date net sales increased by $67.9 million, or 3.1%, to $2.3 billion, with Infiltrator sales up by $51.1 million, or 14.9%[7] - Net sales for the three months ended December 31, 2024, increased to $690,538,000, up 4.0% from $662,367,000 in the same period of 2023[23] Income and Earnings - Net income decreased by $24.6 million, or 23.0%, to $82.3 million, with diluted earnings per share decreasing by $0.30, or 22.3%, to $1.04[4] - Net income attributable to ADS for the three months ended December 31, 2024, was $81,231,000, down 23.1% from $105,639,000 in the prior year[23] - The company reported a decrease in net income for the nine months ended December 31, 2024, to $375,785,000, down 10.1% from $417,812,000 in 2023[27] - Diluted Earnings Per Share for Q3 2024 was $1.04, a decrease of 22.4% from $1.34 in Q3 2023[40] - Adjusted Earnings per Share for Q3 2024 was $1.09, down 20.4% from $1.37 in Q3 2023[40] Expenses - Selling, general and administrative expenses increased by $9.5 million, or 10.4%, to $100.8 million, representing 14.6% of sales[5] - Operating expenses for the three months ended December 31, 2024, rose to $100,778,000, an increase of 10.5% from $91,289,000 in 2023[23] - Total Gross Profit for Q3 2024 was $241,594, down 7.0% from $259,849 in Q3 2023[36] - Total Segment Adjusted Gross Profit for Q3 2024 was $275,943, a decrease of 2.3% from $284,253 in Q3 2023[36] Cash Flow and Liquidity - Net cash provided by operating activities was $540.3 million, down from $700.3 million in the prior year[12] - Net cash provided by operating activities for the nine months ended December 31, 2024, was $540,264,000, down from $700,262,000 in 2023[27] - Free Cash Flow for the nine months ended December 31, 2024, was $373,854, a decline of 33.7% compared to $563,877 in the same period of 2023[38] - Total liquidity was $1,078.4 million, including cash of $488.9 million and $589.6 million available under credit facilities[14] Capital Expenditures and Debt - Capital expenditures for the nine months ended December 31, 2024, were $166,410,000, compared to $136,385,000 in the same period of 2023[27] - Long-term debt obligations, net, as of December 31, 2024, were $1,253,129,000, slightly down from $1,259,522,000 as of March 31, 2024[25] Future Outlook - The company confirmed its fiscal 2025 financial targets, expecting net sales in the range of $2.900 billion to $2.975 billion and Adjusted EBITDA between $880 million and $920 million[16] Acquisition - The company completed the acquisition of Orenco on October 1, 2024, enhancing its offerings in decentralized wastewater management[13] Depreciation and Interest - Depreciation and amortization for Q3 2024 was $47,766, an increase of 25.5% from $38,053 in Q3 2023[37] - Interest expense for Q3 2024 was $23,094, a slight increase from $22,331 in Q3 2023[37]