Financial Data and Key Metrics Changes - The company achieved a gross profit dollar growth of 16% and revenue growth of 8% in the fourth quarter compared to the same period last year, generating $61 million in operating cash flow [4][15] - The fourth quarter gross profit margin reached a record 31.4%, which is 215 basis points higher than the prior year [4][18] - For the full fiscal year 2025, revenues increased by 9% to $1.1 billion, with net income rising to $180.7 million, or $14.86 per diluted share, compared to $149.8 million, or $12.29 per diluted share in the prior year [22][23] Business Line Data and Key Metrics Changes - The electric utility sector saw revenues double compared to the same period last year, while the light rail traction sector increased by 85% [17][19] - The commercial and other industrial sectors experienced a 9% decline due to project timing, while revenues from petrochemical and oil and gas sectors decreased by 25% and 10%, respectively [17][19] - The company booked $271 million in new orders during the fourth quarter, a 1% increase year-over-year, with a total of $1.2 billion in new orders for the full year, representing a 9% increase [7][21] Market Data and Key Metrics Changes - The company reported that electric utility and oil and gas sectors each now make up one-third of the total backlog, which increased to $1.4 billion, $41 million higher than the end of fiscal 2024 [16][22] - International revenues increased by 38% to $68 million, while domestic revenues rose by 2% to $239 million [17][19] - The backlog is well balanced across markets and geographies, with 60% of it convertible in 2026 [68] Company Strategy and Development Direction - The company is focusing on diversifying its business and growing in strategic markets, particularly electric utility and commercial sectors, which now account for 41% of revenue and 48% of total backlog [5][6] - A $12.4 million investment is being made to expand capacity at the JacintoPort facility, primarily to support oil and gas customers and anticipated LNG project developments [9][10] - The acquisition of REMSDAC is expected to enhance the company's electrical automation strategy and expand its product offerings in various markets [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the commercial environment for all end markets, expecting continued momentum into fiscal 2026, particularly in the oil and gas and electric utility sectors [12][13] - The company noted a divergence in market performance, with some softness in traditional oil and gas markets being offset by strength in electric utility and data center opportunities [8][12] - Management highlighted the importance of maintaining a stable pricing environment and disciplined project execution to support future performance [24] Other Important Information - The company holds zero debt and ended fiscal 2025 with cash, cash equivalents, and short-term investments of $476 million, reflecting strong commercial activity [23][24] - Research and development spending increased by 17% to $11 million, focusing on new product design and development [22] Q&A Session Summary Question: Changes in competitive landscape or pricing environment - Management noted that the oil and gas market remains healthy, but some regions are softer and more price-sensitive, while the electric utility market is more demand-driven [29][30] Question: Seasonality and first quarter outlook - The first quarter is expected to be seasonally softer due to holidays, but overall optimism for the year remains high [31] Question: SG&A expenses and one-time M&A costs - SG&A expenses increased by $5 million year-over-year, with $3 million attributed to compensation and nearly $2 million to acquisition-related costs [33] Question: Trends in commercial and industrial (C&I) sector - Management indicated that the decline in the C&I sector was largely due to timing, with significant growth opportunities in data centers [39] Question: Sustainability of growth in the utility sector - Management expressed confidence in the utility sector's growth, highlighting equal weighting in backlog between oil and gas and utility sectors [40] Question: LNG project timelines and fundamentals - Management acknowledged delays in LNG project final investment decisions (FID) but remains optimistic about the sector's fundamentals [49][50] Question: R&D spending and commercialization timeline - R&D spending is expected to continue at current levels, with some products anticipated to hit the market in 2026 [64][66] Question: CapEx budget for 2026 - The CapEx budget for 2026 includes $12.4 million for the JacintoPort expansion and $5-$7 million for maintenance and productivity projects [67] Question: Data center revenue as a percentage of backlog - Data center revenue accounts for about 15% of the backlog, with half of that being attributed to data centers, which is an increase from the previous year [71]

Core Viewpoint - Powell Industries, Inc. has announced the acquisition of Remsdaq Ltd. for £12.2 million (approximately $16.3 million), aimed at enhancing its automation solutions and expanding its capabilities in the electrical energy sector [1][4]. Group 1: Acquisition Details - The total consideration for the acquisition is £12.2 million, which includes an upfront payment of £9.2 million, with the remainder contingent on Remsdaq meeting specific milestones [4]. - The transaction is expected to close in the fourth quarter of fiscal 2025, subject to customary closing conditions, after which Remsdaq will become a wholly owned subsidiary of Powell (U.K.) Ltd. [4]. Group 2: Strategic Importance - The acquisition is part of Powell's strategic initiative to expand its automation platform capabilities, combining its hardware and detection sensors with Remsdaq's SCADA RTUs to meet the growing demand for sophisticated utility solutions [2][3]. - The integration is anticipated to enhance operational efficiency, system reliability, and security for utility customers, addressing a growing and underserved demand within the electrical industry [2][3]. Group 3: Company Profiles - Powell Industries, Inc. specializes in custom-engineered solutions for the management, control, and distribution of electrical energy, serving large industrial customers including utilities and oil and gas producers [5]. - Remsdaq Ltd. focuses on advanced technology solutions, particularly in SCADA RTUs for the electricity industry, and has a strong presence across various sectors including utilities and military [6].