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Hammond Power Solutions Reports Third Quarter 2025 Financial Results
Globenewswireยท2025-10-23 21:15

Core Insights - Hammond Power Solutions Inc. (HPS) reported strong financial results for Q3 2025, with revenues of $218 million, marking a 13.7% increase compared to Q3 2024, and the second highest quarter for shipments in the company's history [3][6] - The U.S. market showed significant growth, with sales increasing by 21.5% in Q3 2025 compared to the same quarter in 2024, driven by strong distribution and private label sales [3][4] - The company's backlog increased by 22.4% year-over-year and 27.7% since the beginning of 2025, indicating strong future demand [4][6] Financial Performance - Revenue for Q3 2025 was $218 million, up from $191.972 million in Q3 2024, reflecting a $26.369 million increase [14] - Adjusted EBITDA for Q3 2025 was $30 million, representing 13.9% of sales, while net earnings reached $17.4 million, an increase from $16.311 million in Q3 2024 [6][10] - The gross margin for Q3 2025 was 30.1%, down from 33.8% in Q3 2024, primarily due to higher material costs and inflation [5][7] Market Dynamics - The U.S. market's sales growth was attributed to strong performance in the private label channel and steady growth in distribution, particularly in data centers and related sectors [3][4] - The Canadian market experienced a slight decline of 2.9%, while sales in India decreased by 0.4% year-over-year [3][4] Cost Management - Selling and distribution expenses increased to $24.224 million in Q3 2025, accounting for 11.1% of sales, up from 10.5% in Q3 2024 [8] - General and administrative expenses decreased to $16.534 million, or 7.6% of sales, compared to 11.0% in Q3 2024, mainly due to reduced share-based compensation costs [9] Future Outlook - The company anticipates increased capital expenditures in the upcoming quarters to support new data center orders and production shifts [5] - Significant orders received after the close of Q3 2025 are expected to be shipped primarily in 2026, indicating a positive outlook for future revenue [3][4]