Financial Data and Key Metrics Changes - Full year 2025 sales increased by 5.4% to $2.1 billion, with segment operating income up 10% to $269 million [5][17][18] - Fourth quarter 2025 sales were $506.9 million, a year-over-year increase of 4.4%, with operating income rising 20% to $51.6 million [12][13][15][16] - Adjusted diluted earnings per share for 2025 was $4.14, a 6% increase from $3.92 in 2024, while GAAP diluted EPS was $3.22, down from $3.86 due to a pension settlement charge [12][17] Business Line Data and Key Metrics Changes - Global Water Systems sales increased by 6% for the full year 2025, driven by strong pricing and acquisitions, while operating income was up 5.2% [22][23] - Energy Systems sales rose by 9% to $299 million for the full year, with operating income increasing by 6% to $99 million [24] - Distribution segment sales increased by 2% to $700.7 million, with operating income up 64% to $39.8 million, reflecting margin enhancement initiatives [25] Market Data and Key Metrics Changes - Water Systems in the U.S. and Canada saw a 4% decline in Q4 due to softer HVAC markets, while international sales increased by 15% [19] - Energy Systems sales outside the U.S. and Canada increased by 19%, indicating strong international demand [20] - Distribution segment's operating income margin improved by 300 basis points to 3.3% in Q4, driven by higher volumes and price realization [21] Company Strategy and Development Direction - The company aims to position itself as an innovation and growth leader, with over 35 new products expected to generate $160 million in revenue by year three [8] - Focus on enhancing margins through a value acceleration office, utilizing AI and process engineering to streamline operations and manage costs [10][31] - The company is committed to strategic acquisitions to fill portfolio gaps and enhance market reach, with a healthy M&A pipeline anticipated for 2026 [60][61] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate a turbulent global market, with a healthy order book and backlog as they move into 2026 [5][6] - The outlook for 2026 includes expected sales growth of 3% to 4% across segments, with adjusted EPS guidance of $4.40 to $4.60 [27][28] - Management noted that the company is well-positioned to capitalize on urbanization and increasing demand for high-quality water and energy solutions [29][30] Other Important Information - The company completed approximately $120 million in acquisitions and $160 million in share buybacks in 2025, maintaining a strong balance sheet [6][26] - A quarterly cash dividend of $0.28 was announced, marking the 34th consecutive year of dividend increases [26] Q&A Session Summary Question: Organic outlook across segments for revenue guidance - Management indicated a 3%-5% growth outlook for the water business, with a mix of volume and price increases expected [36] Question: Specifics on water business end markets and geographic demand - Management noted stabilization in HVAC markets and expected growth in the U.S. and Europe, with no pronounced weaknesses anticipated [40][41] Question: Impact of HVAC on water segment performance - Management clarified that HVAC weakness was isolated to Q4 and expected normalization in early 2026 [45] Question: Energy segment margin challenges - Management acknowledged tariff impacts and indicated expectations for margin recovery in 2026 [50] Question: Integration progress of recent acquisitions - Management reported smooth integration of PumpEng and Barnes, with positive growth synergies anticipated for 2026 [58][59] Question: Value acceleration office and its impact - Management highlighted the office's focus on process reengineering and growth, with expected benefits in productivity and efficiency [64][66]

Franklin Electric (NasdaqGS:FELE) Q4 2025 Earnings call February 17, 2026 09:00 AM ET Speaker6Hello, and welcome to the Franklin Electric reports fourth quarter, 2025 and full year 2025 results conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand has been raise ...

Financial Data and Key Metrics Changes - The company reported better than expected results in Q1 2025, with revenue and profitability slightly above plan across all business segments [6][15] - Organic sales declined by 1% year-over-year, primarily due to difficult comparisons in semiconductor, agriculture, chemical, and energy businesses [15] - Adjusted EBITDA margin decreased by 50 basis points to 25.5% due to volume deleverage and margin dilution from the acquisition of Mak, partially offset by positive price cost and productivity [15][16] - Adjusted EPS for Q1 2025 was $1.75, exceeding the high end of the guidance by $0.10 [15] Business Line Data and Key Metrics Changes - In Health and Science Technology (HST), organic sales declined by 1%, while organic orders increased by 3% [18] - In Flow Measurement Technology (FMT), organic sales declined by 4% and organic orders declined by 3% [19] - Fire and Safety Division (FSD) saw organic sales increase by 5% and organic orders up by 2% [20] Market Data and Key Metrics Changes - The company experienced resilient demand overall, with organic orders up by 1% and backlog increasing by approximately $60 million [15] - The semiconductor business faced headwinds, particularly in wafer fabrication, while the MRO facing businesses provided a slight tailwind [9][18] Company Strategy and Development Direction - The company is focusing on five strong growth platforms and has identified integrative threats to support higher growth and expanded margins [25][26] - The strategy includes flat organizational structures with autonomous decision rights and a focus on quick iterative innovation [25][26] - The company is committed to returning capital to shareholders while exploring multiple avenues for capital deployment [26] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the fluid trade and geopolitical situation but noted that they have not observed any immediate signs of demand softening [21][22] - The company has proactively identified an additional $20 million in savings targets for 2025 to mitigate potential volume pressures [22] - Management expressed confidence in their ability to absorb the impact of tariffs through pricing actions and operational efficiencies [21][23] Other Important Information - The company reported a $40 million multiyear agreement for a custom wastewater filtration solution, with 25% of the order booked in Q1 [13] - The company has $490 million remaining under its current share repurchase authorization [16] Q&A Session Summary Question: Clarification on guidance and inputs - Management confirmed comfort with guidance and flexibility to manage inputs, including FX and cost savings [30][32] Question: Resilience of the portfolio amid macro pressures - Management highlighted strong growth platforms and productivity optimization as key to resilience [38][39] Question: Tariff impacts and pricing - Management indicated that the majority of tariff impacts will be seen in Q3 and Q4, with proactive pricing actions in place [45][46] Question: Strategic growth platforms and branding - Management explained the rationale behind combining businesses into strategic growth platforms while maintaining individual brand equity [77][78] Question: Update on semiconductor recovery - Management acknowledged industry challenges but noted some growth tailwinds in MRO facing businesses [70][72]