CSW Industrials(CSWI) - 2025 Q4 - Annual Results

Revenue Performance - Total revenue for fiscal 2025 fourth quarter reached a record $230.5 million, a 9.3% increase compared to the prior year period[4] - For fiscal 2025, total revenue increased 10.8% to $878.3 million, with $47.5 million or 6.0% attributed to inorganic growth from acquisitions[19] - Contractor Solutions segment revenue for the fourth quarter was $165.9 million, a 17.5% increase, driven by both organic and inorganic growth[15] - Contractor Solutions segment revenue increased by $80.8 million or 15.1% year-over-year, reaching $617.3 million, driven by $47.5 million from acquisitions and $33.3 million from organic growth[30] - Engineered Building Solutions segment revenue increased by $6.4 million or 5.6% to $121.1 million, attributed to backlog conversion and market expansion[33] - For the year ended March 31, 2025, consolidated net revenue was $878,301,000, up from $792,840,000 in 2024, reflecting a year-over-year increase of 10.8%[64] Net Income and Earnings - Net income attributable to CSWI for the fourth quarter was $35.1 million, representing an 18.7% increase from $31.8 million in the prior year[4] - Net income attributable to CSWI for the full year improved 34.4% to $136.7 million, with adjusted EPS increasing 20.0% to $8.41[26] - Net income attributable to CSW Industrials, Inc. for the year was $136.652 million, up from $101.648 million in the prior year, reflecting a year-over-year increase of 34.4%[47] - Net income for the year ended March 31, 2025, increased to $137,484,000, up from $102,539,000 in 2024, representing a growth of 34%[51] - Adjusted net income attributable to CSWI for the year ended March 31, 2025, was $137,249,000, compared to $109,148,000 in 2024, reflecting a 26% increase[53] EBITDA and Operating Income - Adjusted EBITDA for the fourth quarter grew 7.1% to $59.8 million, with a margin of 25.9%[4] - Adjusted EBITDA for the year ended March 31, 2025, reached $227,860,000, up from $200,011,000 in 2024, indicating a growth of 14%[58] - Adjusted EBITDA for the Contractor Solutions segment was $205.4 million, or 33.3% of revenue, compared to $173.7 million, or 32.4% of revenue in the prior year[31] - Adjusted Operating Income for the year ended March 31, 2025, was $185,641,000, which is 21.1% of revenue, compared to $159,118,000 or 20.1% of revenue for the year ended March 31, 2024[64] Cash Flow and Liquidity - Cash and cash equivalents rose significantly to $225.845 million from $22.156 million year-over-year, indicating improved liquidity[49] - Cash flows from operating activities for the year ended March 31, 2025, totaled $168,362,000, slightly higher than $164,332,000 in 2024[51] - Free cash flow for the three months ended March 31, 2025, was $22,762,000, which is 38.1% of Adjusted EBITDA, compared to $17,511,000 or 31.4% for the same period in 2024[66] - For the year ended March 31, 2025, free cash flow was $152,096,000, representing 66.7% of Adjusted EBITDA, compared to $147,757,000 or 73.9% for the year ended March 31, 2024[66] Acquisitions and Investments - The company invested $84.7 million in acquisitions and returned $32.9 million to shareholders through dividends and share repurchases[4] - Following the fiscal year-end, the company announced the acquisition of Aspen Manufacturing for $313.5 million[4] - CSW Industrials closed the acquisition of Aspen Manufacturing for $313.5 million on May 1, 2025, with specific outlook metrics provided for fiscal year 2026[35] - Net cash used in investing activities increased significantly to $102,221,000 in 2025 from $42,504,000 in 2024, primarily due to cash paid for acquisitions[51] Operating Margins and Tax Rates - Operating income margin for fiscal 2025 improved to 20.6%, reflecting effective management of operating expenses[22] - The effective tax rate for the year ended March 31, 2025, was 23.7%, compared to 27.0% in 2024, showing an improvement in tax efficiency[55] - The adjusted effective tax rate for the year ended March 31, 2025, was 25.5%, compared to 26.1% in 2024, indicating a slight decrease[55] - The operating income margin for the Contractor Solutions segment improved to 26.9%, or 27.6% adjusted, an increase of 110 basis points from the prior year[31]