Atkore (ATKR) - 2025 Q3 - Quarterly Results

Executive Summary Atkore Inc. achieved strong Q3 2025 results, meeting the high end of guidance for Net Sales, Adjusted EBITDA, and Adjusted EPS, while maintaining its full-year outlook Q3 2025 Highlights Atkore Inc. achieved strong Q3 2025 results, meeting the high end of guidance for Net Sales, Adjusted EBITDA, and Adjusted EPS, while maintaining its full-year outlook - Atkore delivered strong financial results for Q3 2025, with Net Sales, Adjusted EBITDA, and Adjusted EPS reaching the top end of previously guided ranges[3] - Organic volume grew 2% year-over-year, accompanied by solid productivity improvements[3] Q3 2025 Key Financial Highlights (YoY Change) | Metric | Q3 2025 Value | Q3 2024 Value | Change | % Change | Source Chunk | | :-------------------------------- | :------------ | :------------ | :----- | :------- | :----------- | | Net sales | $735.0 million | $822.4 million | $(87.3) million | (10.6)% | 4, 5 | | Net income | $43.0 million | $123.4 million | $(80.5) million | (65.2)% | 4, 5 | | Adjusted EBITDA | $99.9 million | $206.1 million | $(106.2) million | (51.5)% | 4, 5 | | Net income per diluted share | $1.25 | $3.33 | $(2.08) | - | 5 | | Adjusted net income per diluted share | $1.63 | $3.80 | $(2.17) | - | 5 | - The Board of Directors approved a quarterly dividend payment of $0.33 per share, payable on August 29, 2025[5] CEO Commentary & Retirement Bill Waltz, Atkore's President and CEO, expressed pride in the team's achievements and confidence in future growth, announcing his decision to retire - Bill Waltz, President and CEO, announced his decision to retire from Atkore, with a focus on ensuring a seamless transition until a successor is appointed[3] - Waltz highlighted the company's strength derived from its strategy, process, and people[3] Consolidated Financial Results (Q3 2025) Consolidated financial results for Q3 2025 show significant year-over-year declines across key metrics, including net sales, gross profit, and net income Net Sales Analysis Consolidated net sales for Q3 2025 decreased by 10.6% year-over-year, primarily driven by a significant decline in average selling prices and the impact of divestitures Consolidated Net Sales (Q3 2025 vs. Q3 2024) | Metric | Q3 2025 | Q3 2024 | Change | % Change | Source Chunk | | :-------- | :-------- | :-------- | :----- | :------- | :----------- | | Net sales | $735.0 million | $822.4 million | $(87.3) million | (10.6)% | 4, 6 | - The decrease in net sales was primarily due to decreased average selling prices ($100.5 million) and the impact of fiscal 2025 divestitures ($4.2 million), partially offset by increased sales volume ($15.4 million)[6] Gross Profit & Margin Analysis Gross profit saw a substantial decrease of 38.5% in Q3 2025, leading to a significant drop in gross margin, mainly due to lower average selling prices and increased freight costs Consolidated Gross Profit & Margin (Q3 2025 vs. Q3 2024) | Metric | Q3 2025 | Q3 2024 | Change | % Change | Source Chunk | | :---------- | :-------- | :-------- | :----- | :------- | :----------- | | Gross profit | $172.1 million | $279.7 million | $(107.6) million | (38.5)% | 7 | | Gross margin | 23.4% | 34.0% | (10.6) pp | - | 7 | - The decline in gross profit was primarily driven by decreased average selling prices ($100.5 million) and increased freight costs ($4.2 million)[7] Net Income Analysis Net income for Q3 2025 decreased significantly by 65.2% year-over-year, primarily due to lower gross profit, partially mitigated by reduced income tax expense and intangible amortization Consolidated Net Income (Q3 2025 vs. Q3 2024) | Metric | Q3 2025 | Q3 2024 | Change | % Change | Source Chunk | | :--------- | :-------- | :-------- | :----- | :------- | :----------- | | Net income | $43.0 million | $123.4 million | $(80.5) million | (65.2)% | 4, 8 | - The decrease was mainly attributed to lower gross profit ($107.6 million), partially offset by lower income tax expense ($22.4 million) and lower intangible amortization ($3.1 million)[8] Adjusted EBITDA Analysis Adjusted EBITDA decreased by 51.5% in Q3 2025 compared to the prior year, primarily due to the decline in gross profit Consolidated Adjusted EBITDA (Q3 2025 vs. Q3 2024) | Metric | Q3 2025 | Q3 2024 | Change | % Change | Source Chunk | | :-------------- | :-------- | :-------- | :----- | :------- | :----------- | | Adjusted EBITDA | $99.9 million | $206.1 million | $(106.2) million | (51.5)% | 4, 9 | - The decrease in Adjusted EBITDA was primarily driven by lower gross profit[9] Earnings Per Share (EPS) Analysis Both GAAP and Adjusted diluted EPS decreased significantly in Q3 2025, primarily reflecting the lower net income for the quarter Diluted EPS (Q3 2025 vs. Q3 2024) | Metric | Q3 2025 | Q3 2024 | Change | Source Chunk | | :-------------------------------- | :------ | :------ | :----- | :----------- | | Net income per diluted share (GAAP) | $1.25 | $3.33 | $(2.08) | 5, 10 | | Adjusted net income per diluted share | $1.63 | $3.80 | $(2.17) | 5, 10 | - The decrease in diluted earnings per share is primarily attributed to lower net income in the quarter[10] Segment Results (Q3 2025) Segment results for Q3 2025 indicate varied performance, with the Electrical segment experiencing declines while Safety & Infrastructure showed resilience Electrical Segment The Electrical segment experienced a notable decline in net sales and Adjusted EBITDA in Q3 2025, primarily due to decreased average selling prices and divestitures Electrical Segment Performance (Q3 2025 vs. Q3 2024) | Metric | Q3 2025 | Q3 2024 | Change | % Change | Source Chunk | | :-------------------- | :-------- | :-------- | :----- | :------- | :----------- | | Net sales | $521.3 million | $606.0 million | $(84.7) million | (14.0)% | 4, 11 | | Adjusted EBITDA | $81.2 million | $182.6 million | $(101.3) million | (55.5)% | 4, 12 | | Adjusted EBITDA margin | 15.6% | 30.1% | (14.5) pp | - | 12 | - The decrease in net sales was primarily due to decreased average selling prices ($92.2 million) and fiscal 2025 divestitures ($4.2 million), partially offset by increased sales volume ($9.5 million)[11] - The decline in Adjusted EBITDA and Adjusted EBITDA margin was largely due to lower average selling prices[12] Safety & Infrastructure Segment The Safety & Infrastructure segment saw a slight decrease in net sales but an increase in Adjusted EBITDA and Adjusted EBITDA margin in Q3 2025, driven by higher sales volume and improvements Safety & Infrastructure Segment Performance (Q3 2025 vs. Q3 2024) | Metric | Q3 2025 | Q3 2024 | Change | % Change | Source Chunk | | :-------------------- | :-------- | :-------- | :----- | :------- | :----------- | | Net sales | $214.0 million | $217.0 million | $(3.1) million | (1.4)% | 4, 13 | | Adjusted EBITDA | $30.7 million | $30.0 million | $0.7 million | 2.3% | 4, 14 | | Adjusted EBITDA margin | 14.4% | 13.8% | 0.6 pp | - | 14 | - The net sales decrease was primarily attributed to lower selling prices ($8.3 million), partially offset by higher sales volume ($5.9 million)[13] - The increase in Adjusted EBITDA and margin was largely due to improvements in the construction business and cable management and metal framing products in North America[14] Liquidity & Capital Resources The company's liquidity position is supported by a declared quarterly dividend, reflecting its capital allocation strategy Dividend Declaration Atkore's Board of Directors approved a quarterly dividend payment of $0.33 per share of common stock - A quarterly dividend of $0.33 per share of common stock was approved on July 30, 2025[15] - The dividend is payable on August 29, 2025, to stockholders of record on August 19, 2025[15] Full-Year Outlook (FY2025) Atkore is maintaining its full-year Adjusted EBITDA outlook midpoint and increasing its Adjusted net income per diluted share midpoint for fiscal year 2025 FY2025 Full-Year Outlook | Metric | Previous Outlook | Updated Outlook | Source Chunk | | :-------------------------------- | :--------------- | :-------------- | :----------- | | Adjusted EBITDA midpoint | $400 million | $400 million (range $390M - $410M) | 5, 16 | | Adjusted net income per diluted share midpoint | - | $6.50 (range $6.25 - $6.75) | 5, 16 | - The outlook may vary due to changes in assumptions, market conditions, and other factors[16] Company Information This section provides an overview of Atkore Inc., including its business, investor relations, and communication policies About Atkore Inc. Atkore Inc. is a leading manufacturer of electrical products, providing sustainable solutions for electrification and digital transformation with 5,600 employees and $3.2 billion in sales in fiscal year 2024 - Atkore is a leading manufacturer of electrical products for commercial, industrial, data center, telecommunications, and solar applications[20] - The company has 5,600 employees and reported $3.2 billion in sales in fiscal year 2024[20] - Atkore delivers sustainable solutions to meet the growing demands of electrification and digital transformation[20] Conference Call & Investor Relations Atkore hosted a conference call on August 5, 2025, to discuss financial results, with replay and webcast options available for investors - A conference call was held on August 5, 2025, at 8 a.m. Eastern time to discuss financial results[17] - Investors can access the webcast and replay via the Investor Relations section of the company's website[18] Dissemination of Company Information Atkore plans to disseminate future company developments and financial performance through its website, press releases, SEC filings, conference calls, media broadcasts, and webcasts - Atkore will make future announcements via its website (www.atkore.com), press releases, SEC filings, conference calls, media broadcasts, and webcasts[21] Contacts Contact information for media and investor relations is provided for inquiries regarding Atkore Inc - Media Contact: Lisa Winter, Vice President - Communications (708-225-2453, AtkoreCommunications@atkore.com)[22] - Investor Contact: Matthew Kline, Vice President - Treasury & Investor Relations (708-225-2116, Investors@atkore.com)[22] Forward-Looking Statements This section outlines the inherent risks and uncertainties associated with forward-looking statements, emphasizing that actual results may differ materially from projections due to various factors - Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond the company's control[24] - Actual performance and outcomes may differ materially from those made or suggested in forward-looking statements[24] - Important factors that could cause differences include declines in general business and economic conditions, weakness in the non-residential construction industry, changes in raw material prices, intense competition, and regulatory changes[25] Non-GAAP Financial Measures This section defines and explains the non-GAAP financial measures used by the company, including Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP measures used by management to evaluate business performance and profitability, providing insights into operating trends and strategies - Adjusted EBITDA is defined as net income (loss) before income taxes, adjusted for unallocated expenses, depreciation and amortization, interest expense, stock-based compensation, and other specific items[29] - Adjusted EBITDA margin is Adjusted EBITDA as a percentage of Net sales[29] - These measures are used for evaluating business performance, preparing operating budgets, viewing operating trends, and identifying improvement strategies[28] Adjusted Net Income and Adjusted Net Income per Share Adjusted net income and Adjusted net income per share are non-GAAP measures that provide additional views of the company's results by excluding the impact of unusual and certain non-cash items - Adjusted net income is defined as net income before stock-based compensation, loss on extinguishment of debt, asset impairment charges, intangible asset amortization, and other specific items, along with their tax effects[31][32] - Adjusted net income per share excludes the per share impact of these adjustments[32] - These measures offer insights into performance and profitability by excluding unusual and non-cash items[31] Free Cash Flow Free Cash Flow is a non-GAAP measure defined as net cash provided by (used in) operating activities less capital expenditures, providing meaningful information regarding the company's liquidity - Free Cash Flow is defined as net cash provided by (used in) operating activities, less capital expenditures[33] - This measure provides meaningful information regarding the Company's liquidity[33] Financial Statements This section presents the condensed consolidated statements of operations, balance sheets, and cash flows for the reported periods Condensed Consolidated Statements of Operations The condensed consolidated statements of operations show a significant decline in net income for both the three and nine months ended June 27, 2025, compared to the prior year Condensed Consolidated Statements of Operations (Key Figures, in thousands) | Metric | Three months ended June 27, 2025 | Three months ended June 28, 2024 | Nine months ended June 27, 2025 | Nine months ended June 28, 2024 | Source Chunk | | :-------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | :----------- | | Net sales | $735,045 | $822,364 | $2,098,367 | $2,413,756 | 35 | | Gross profit | $172,060 | $279,655 | $528,265 | $861,770 | 35 | | Operating income | $63,813 | $168,452 | $79,930 | $522,719 | 35 | | Net income | $42,962 | $123,417 | $39,243 | $399,753 | 35 | | Diluted Net income per share | $1.25 | $3.33 | $1.14 | $10.61 | 35 | Condensed Consolidated Balance Sheets The balance sheet as of June 27, 2025, shows a decrease in total assets and total equity compared to September 30, 2024, with notable changes in intangible assets and retained earnings Condensed Consolidated Balance Sheets (Key Figures, in thousands) | Metric | June 27, 2025 | September 30, 2024 | Source Chunk | | :-------------------------- | :-------------- | :----------------- | :----------- | | Total Assets | $2,917,152 | $3,021,403 | 37 | | Total Liabilities | $1,451,432 | $1,481,503 | 37 | | Total Equity | $1,465,720 | $1,539,900 | 37 | | Cash and cash equivalents | $331,017 | $351,385 | 37 | | Intangible assets, net | $208,566 | $340,431 | 37 | | Retained earnings | $954,589 | $1,049,390 | 37 | Condensed Consolidated Statements of Cash Flows For the nine months ended June 27, 2025, net cash provided by operating activities decreased significantly compared to the prior year, while net cash used in investing and financing activities also saw changes Condensed Consolidated Statements of Cash Flows (Key Figures, in thousands) | Metric | Nine months ended June 27, 2025 | Nine months ended June 28, 2024 | Source Chunk | | :---------------------------------- | :------------------------------ | :------------------------------ | :----------- | | Net cash provided by operating activities | $192,359 | $349,957 | 38 | | Net cash used in investing activities | $(69,302) | $(110,677) | 38 | | Net cash used in financing activities | $(143,149) | $(324,595) | 38 | | Decrease in cash and cash equivalents | $(20,368) | $(84,457) | 38 | | Cash and cash equivalents at end of period | $331,017 | $303,657 | 38 | Free Cash Flow (Nine months ended, in thousands) | Metric | Nine months ended June 27, 2025 | Nine months ended June 28, 2024 | Source Chunk | | :----------- | :------------------------------ | :------------------------------ | :----------- | | Free Cash Flow | $107,439 | $244,859 | 39 | Non-GAAP Reconciliations This section provides detailed reconciliations of non-GAAP financial measures, including Adjusted EBITDA, Adjusted Net Income, and Net Debt, to their most directly comparable GAAP measures Adjusted EBITDA Reconciliation This section provides a reconciliation of Adjusted EBITDA to net income for the three and nine months ended June 27, 2025, detailing the adjustments made from GAAP net income Adjusted EBITDA Reconciliation (Q3 & YTD, in thousands) | Metric | Three months ended June 27, 2025 | Three months ended June 28, 2024 | Nine months ended June 27, 2025 | Nine months ended June 28, 2024 | Source Chunk | | :-------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | :----------- | | Net income | $42,962 | $123,417 | $39,243 | $399,753 | 42 | | Interest expense, net | $8,873 | $9,944 | $25,343 | $26,058 | 42 | | Income tax expense | $12,128 | $34,531 | $7,935 | $95,606 | 42 | | Depreciation and amortization | $29,033 | $29,932 | $87,603 | $88,407 | 42 | | Stock-based compensation | $7,246 | $4,488 | $21,056 | $14,273 | 42 | | Asset impairment charges | — | — | $127,733 | — | 42 | | Adjusted EBITDA | $99,921 | $206,125 | $315,479 | $631,563 | 42 | Segment Information (Net Sales & Adjusted EBITDA Margin) This section provides a detailed breakdown of Net sales and Adjusted EBITDA margin for the Electrical and Safety & Infrastructure segments for both the three and nine months ended June 27, 2025 Segment Net Sales and Adjusted EBITDA Margin (Q3 & YTD, in thousands) | Segment | Metric | Three months ended June 27, 2025 | Three months ended June 28, 2024 | Nine months ended June 27, 2025 | Nine months ended June 28, 2024 | Source Chunk | | :---------------------- | :-------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | :----------- | | Electrical | Net sales | $521,308 | $605,962 | $1,479,340 | $1,790,443 | 45 | | | Adjusted EBITDA | $81,235 | $182,568 | $264,564 | $582,679 | 45 | | | Adjusted EBITDA margin | 15.6% | 30.1% | 17.9% | 32.5% | 45 | | Safety & Infrastructure | Net sales | $213,963 | $217,024 | $619,960 | $624,569 | 45 | | | Adjusted EBITDA | $30,731 | $30,042 | $82,374 | $75,084 | 45 | | | Adjusted EBITDA margin | 14.4% | 13.8% | 13.3% | 12.0% | 45 | Adjusted Net Income Per Diluted Share Reconciliation This section reconciles Adjusted net income to GAAP net income and calculates Adjusted net income per diluted share for the three and nine months ended June 27, 2025, showing the impact of various adjustments Adjusted Net Income Per Diluted Share Reconciliation (Q3 & YTD, in thousands, except per share data) | Metric | Three months ended June 27, 2025 | Three months ended June 28, 2024 | Nine months ended June 27, 2025 | Nine months ended June 28, 2024 | Source Chunk | | :-------------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | :----------- | | Net income | $42,962 | $123,417 | $39,243 | $399,753 | 47 | | Stock-based compensation | $7,246 | $4,488 | $21,056 | $14,273 | 47 | | Intangible asset amortization | $10,108 | $13,216 | $31,972 | $41,904 | 47 | | Asset impairment charges | — | — | $127,733 | — | 47 | | Adjusted net income | $55,304 | $139,046 | $182,407 | $446,241 | 47 | | Diluted weighted average common shares outstanding | 33,853 | 36,616 | 34,391 | 37,174 | 47 | | Adjusted net income per diluted share | $1.63 | $3.80 | $5.30 | $12.00 | 47 | Net Debt Reconciliation This section presents the reconciliation of Net debt to Total debt across several quarters, showing the calculation of net debt by subtracting cash and cash equivalents from total debt Net Debt Reconciliation (Quarterly, in thousands) | Metric | June 27, 2025 | March 28, 2025 | December 27, 2024 | September 30, 2024 | June 28, 2024 | March 29, 2024 | Source Chunk | | :------------------------ | :-------------- | :------------- | :---------------- | :----------------- | :------------ | :------------- | :----------- | | Long-term debt | $764,387 | $765,913 | $765,375 | $764,838 | $764,300 | $763,762 | 50 | | Total debt | $764,387 | $765,913 | $765,375 | $764,838 | $764,300 | $763,762 | 50 | | Less cash and cash equivalents | $331,017 | $330,385 | $310,444 | $351,385 | $303,657 | $368,050 | 50 | | Net debt | $433,370 | $435,528 | $454,931 | $413,453 | $460,643 | $395,712 | 50 | Trailing Twelve Months Adjusted EBITDA Reconciliation This section provides a reconciliation of Adjusted EBITDA for the trailing twelve months (TTM) ended June 27, 2025, by summing the Adjusted EBITDA from the current and preceding three quarters Trailing Twelve Months Adjusted EBITDA Reconciliation (in thousands) | Metric | TTM June 27, 2025 | Q3 2025 (June 27, 2025) | Q2 2025 (March 28, 2025) | Q1 2025 (December 27, 2024) | Q4 2024 (September 30, 2024) | Source Chunk | | :-------------------------- | :------------------ | :---------------------- | :----------------------- | :-------------------------- | :-------------------------- | :----------- | | Net income (loss) | $112,360 | $42,962 | $(50,057) | $46,336 | $73,119 | 52 | | Interest expense, net | $34,869 | $8,873 | $8,261 | $8,209 | $9,526 | 52 | | Income tax expense (benefit) | $26,694 | $12,128 | $(16,452) | $12,260 | $18,759 | 52 | | Depreciation and amortization | $120,215 | $29,033 | $29,238 | $29,333 | $32,611 | 52 | | Stock-based compensation | $27,083 | $7,246 | $7,713 | $6,097 | $6,027 | 52 | | Loss on sale of business | $6,101 | — | $6,101 | — | — | 52 | | Asset impairment charges | $127,733 | — | $127,733 | — | — | 52 | | Adjusted EBITDA | $455,629 | $99,921 | $116,408 | $99,150 | $140,150 | 52 |