Preformed Line Products(US:PLPC)2025-10-30 18:05Financial Performance - Net sales for the three months ended September 30, 2025, were $178.1 million, an increase of $31.1 million or 21% year-over-year[90]. - Gross profit for the same period was $52.8 million, reflecting an increase of $7.1 million or 15% compared to 2024[96]. - Net income for the three months ended September 30, 2025, was $2.6 million, a decrease of $5.1 million, or 69%, compared to $7.7 million in 2024, primarily due to a pension termination charge[100]. - Net sales for the nine months ended September 30, 2025, were $496.2 million, an increase of $69.6 million, or 16%, compared to 2024, with a 19% increase in PLP-USA sales[103]. - Gross profit for the nine months ended September 30, 2025, was $156.9 million, an increase of $22.7 million, or 17%, compared to 2024[104]. - Net income for the nine months ended September 30, 2025, was $26.8 million, compared to $26.6 million for 2024, reflecting a slight increase of $0.2 million[109]. Segment Performance - The Americas segment reported net sales of $29.3 million, up $9.3 million or 47%, driven by higher energy product sales and the acquisition of JAP Telecom[95]. - EMEA segment net sales increased by $3.1 million or 9%, primarily due to higher volumes in energy product sales[95]. - PLP-USA net sales rose by $15.3 million or 23%, mainly due to increased volumes in energy and communications sales[95]. - The Americas net sales increased by $25.2 million, or 42%, primarily due to higher energy product sales and the acquisition of JAP Telecom in May 2025[103]. - EMEA net sales for the nine months ended September 30, 2025, were $100.0 million, an increase of $3.2 million, or 3%, driven by higher energy product sales[103]. - Asia-Pacific net sales increased by $6.3 million, or 8%, primarily due to volume increases in energy products and special industries sales[103]. Costs and Expenses - For the three months ended September 30, 2025, costs and expenses increased by $4.3 million, or 12%, to $39.7 million compared to 2024, with a 15% increase in PLP-USA costs and expenses[97]. - Consolidated costs and expenses for the nine months ended September 30, 2025, were $113.5 million, representing 22.9% of net sales, compared to 23.7% in 2024[102]. - Costs and expenses for the nine months ended September 30, 2025, were $113.5 million, an increase of $12.6 million or 12% compared to 2024[106]. - The Americas segment's costs and expenses increased by 21% to $19.7 million, primarily due to higher personnel costs[106]. Other Financial Metrics - The company incurred LIFO inventory valuation costs of $3.8 million and $6.2 million for the three-month and nine-month periods ending September 30, 2025, respectively[90]. - Other expense, net for the three months ended September 30, 2025, was $10.8 million, unfavorable compared to nominal other income in 2024, mainly due to an $11.7 million pension termination charge[98]. - Other expense, net for the nine months ended September 30, 2025, was $10.1 million, a decline of $10.3 million compared to other income of $0.2 million in 2024, primarily due to an $11.7 million pension termination charge[107]. - Income tax expense for the three months ended September 30, 2025, was $(0.3) million, compared to $2.7 million in 2024, reflecting a tax rate of (11)% versus 26%[99]. - Income taxes for the nine months ended September 30, 2025, were $6.5 million, with an effective tax rate of 19%, down from 20% in 2024[108]. Cash Flow and Debt - Net cash provided by operating activities for the nine months ended September 30, 2025, was $51.5 million, an increase of $8.1 million from $43.4 million in the prior year[121]. - Net cash used in investing activities for the nine months ended September 30, 2025, was $33.2 million, a significant increase from $7.7 million in the prior year, mainly due to the acquisition of JAP Telecom and increased capital expenditures[122]. - Total debt at September 30, 2025, was $38.9 million, with unused availability under the credit facility at $52.1 million[114][115]. - The Company expects future operating cash flows to be sufficient to cover debt repayments, capital expenditures, and dividends for the next 12 months[120]. Market and Economic Conditions - The overall demand for cable anchoring and control hardware is experiencing slow growth in mature markets like the U.S., Canada, Australia, and Western Europe, with potential delays in developing regions despite increasing power needs[128]. - Global economic conditions, including inflation, tariffs, and rising interest rates, may impact the Company's profitability and growth opportunities in core markets[128]. - The Company faces risks related to customers' ability to secure funding for necessary infrastructure projects[128]. - Technological developments, particularly in wireless communication, could affect long-term trends for communication lines[128]. - There is a decreasing demand for products supporting copper-based infrastructure due to new technologies and industry standards[128]. - The Company aims to develop proprietary technology and maintain high-quality products to meet new industry performance standards[128]. - Strengthening customer relationships and expanding geographically are key focuses for the Company to grow sales[128]. - The Company operates globally and is subject to risks from political and economic uncertainties, as well as market risks from interest rate and foreign currency fluctuations[129]. - There have been no material changes in the Company's exposure to market risk since December 31, 2024[130].