Ingersoll Rand(US:IR)2026-02-17 21:36Financial Performance - Revenues for 2025 were $7,650.9 million, an increase of $415.9 million, or 5.7%, compared to $7,235.0 million in 2024[172]. - The increase in revenues was primarily due to acquisitions of $419.9 million and a favorable impact of foreign currencies of $92.0 million, partially offset by lower organic revenues of $96.0 million[173]. - Gross profit for 2025 was $3,336.3 million, with a gross profit margin of 43.6%, slightly down from 43.8% in 2024[172]. - Operating income for 2025 was $1,144.6 million, representing 15.0% of revenues, down from 18.0% in 2024[172]. - Net income attributable to Ingersoll Rand Inc. for 2025 was $581.4 million, a decrease from $838.6 million in 2024, resulting in a net income margin of 7.7%[172]. - Adjusted EBITDA for 2025 was $2,093.8 million, representing 27.4% of revenues, compared to 27.9% in 2024[172]. - Cash flows from operating activities for 2025 were $1,355.7 million, down from $1,396.7 million in 2024[172]. - Free cash flow for 2025 was $1,220.1 million, compared to $1,247.6 million in 2024[172]. - Interest expense was $253.9 million in 2025, an increase of $40.7 million compared to $213.2 million in 2024, primarily due to an increase in long-term debt[181]. - The provision for income taxes was $219.4 million in 2025, resulting in a 23.5% effective tax rate, compared to $262.5 million and a 23.2% rate in 2024[184]. Acquisitions and Growth - In February 2025, Ingersoll Rand completed the acquisition of SSI Aeration, Inc. for cash consideration of $97.8 million[31]. - In July 2025, the company acquired Termomeccanica Industrial Compressors S.p.A. and its subsidiary Adicomp S.p.A. for $193.2 million[31]. - Segment Orders for the Industrial Technologies and Services segment were $6,119.6 million in 2025, an increase of $413.0 million, or 7.2%, compared to $5,706.6 million in 2024[194]. - Segment Revenues for the Precision and Science Technologies segment were $1,594.5 million in 2025, an increase of $177.6 million, or 12.5%, compared to $1,416.9 million in 2024[199]. - Segment Adjusted EBITDA for the Precision and Science Technologies segment was $478.0 million in 2025, an increase of $59.2 million, or 14.1%, from $418.8 million in 2024[200]. Employee and Operational Insights - The company maintains over 60 key manufacturing facilities and more than 50 service and repair centers globally, employing over 21,000 people[16]. - The company has over 21,000 employees as of December 31, 2025, with approximately 6,100 located in the United States[53]. - The voluntary turnover rate for employees in 2025 was 8.1% for hourly and 7.8% for salaried employees, showing a slight improvement from 2024[54]. - The company is committed to employee engagement, achieving an engagement score of 81 in its Connections Engagement survey, placing it in the top 10% of manufacturing organizations surveyed[62]. - The company has a competitive compensation package designed to foster a culture of ownership among employees[56]. Market and Customer Base - Ingersoll Rand's aftermarket revenue represented 36.5% of total company revenue in 2025[18]. - The company has a diverse customer base across various end-markets, including life sciences, food and beverage production, and clean energy[15]. - The company maintains a diverse customer base, with no single customer accounting for more than 10% of consolidated revenues in 2025[49]. - 58% of the company's revenues for the year ended December 31, 2025, were generated from customers outside the United States[73]. Financial Position and Debt - As of December 31, 2025, the company's total indebtedness was $4,784.7 million, with $2,600 million available under the Revolving Credit Facility and Commercial Paper Program[124]. - The company has the ability to increase borrowing availability under the Revolving Credit Facility by up to $1,000 million[128]. - The projected benefit obligations under pension and other postretirement benefit plans exceeded the fair value of plan assets by $132.5 million, indicating an unfunded status[122]. - The company may face liquidity problems if cash flow is insufficient to service its debt obligations, potentially leading to reduced investments or asset disposals[126]. - The company was in compliance with all debt covenants as of December 31, 2025, with no events of default ongoing[210]. Risks and Compliance - The company is subject to various environmental regulations and has an active environmental management program to comply with these laws[66]. - The company faces risks related to compliance with U.S. and foreign laws, which could significantly impact its financial condition and strategic objectives[102]. - Environmental compliance costs and liabilities are increasing, potentially leading to substantial fines and operational changes[119]. - The company may face reputational challenges if it fails to meet environmental, social, and governance (ESG) goals, which could adversely affect its financial condition[115]. - The company is exposed to interest rate risks due to fixed rate to floating rate swap contracts, which could impact net income and cash flows[129]. Product and Technology Development - The company is investing in the development of new products and technologies, including those incorporating AI, which is critical for maintaining its competitive position[88]. - The company has over 2,000 patents, with significant reliance on technical competence and creativity rather than individual patents for business success[50]. Restructuring and Charges - The company incurred restructuring charges of $51.4 million and $31.2 million in the years ended December 31, 2025 and 2024, respectively[110]. - Restructuring and related business transformation costs rose to $51.7 million in 2025 from $32.3 million in 2024[205].