Exchange Income Corporation Posts All Time Record Results in the Third Quarter Driven by the Diversification of its Business Model and Announces a Dividend Increase

Core Insights - Exchange Income Corporation (EIC) reported record financial results for Q3 2025, with significant increases in revenue, net earnings, and free cash flow, driven by a diversified business model [1][2][4][11] - The company announced a dividend increase of $0.12 per share, raising the annual dividend to $2.76, reflecting a 5% increase [1][5][6] Financial Performance - EIC achieved record quarterly revenues of $960 million, an increase of $250 million or 35% compared to the prior year [5][11] - Adjusted EBITDA reached $231 million, up $38 million or 20% year-over-year [5][11] - Net earnings for the quarter were $69 million, a 23% increase from $56 million in the same period last year [5][14] - Free cash flow was reported at $171 million, a 26% increase from $136 million in the prior period [5][11] - Adjusted net earnings also set a record at $76 million, reflecting a 23% increase compared to the previous year [5][11] Segment Performance - The Aerospace & Aviation segment saw revenue growth of $247 million or 57%, totaling $680 million, with adjusted EBITDA increasing by 30% to $202 million [12][11] - The Manufacturing segment's revenue increased by $3 million to $279 million, but adjusted EBITDA decreased by $6 million to $45 million due to operational inefficiencies and tariffs on aluminum [13][11] Capital Structure and Strategy - EIC completed the redemption of its Series K and L convertible debentures, reducing leverage and increasing equity by over $200 million [4][17] - The company plans to eliminate all convertible debentures by year-end, simplifying its capital structure [6][17] - EIC maintains a strong liquidity position with approximately $1.2 billion available for acquisitions and growth capital investments [17] Future Outlook - The company anticipates adjusted EBITDA for fiscal 2026 to be between $825 million and $875 million, based on current contracts and acquisitions [20] - EIC's diversification strategy continues to yield consistent financial performance, with strong growth opportunities identified across its operating segments [19][20]