Core Insights - MISTRAS Group, Inc. reported robust quarterly organic revenue growth in aerospace & defense and industrial markets, with a significant expansion in gross profit margin of 200 basis points, generating net income of $3.0 million and achieving adjusted EBITDA of $24.1 million for Q2 2025 [1][6][12]. Financial Performance - Revenue for Q2 2025 was $185.4 million, a decrease of 2.3% compared to the prior year, but flat when excluding voluntary laboratory consolidations [7]. - Gross profit increased by 5.1% to $53.9 million, primarily due to an improved business mix and operating efficiencies, resulting in a gross profit margin of 29.1% [7]. - Selling, general, and administrative (SG&A) expenses rose by 10.0% to $39.8 million, largely due to a foreign exchange loss of $2.8 million [7]. - Net income for Q2 2025 was $3.0 million, or $0.10 per diluted share, down from $6.4 million, or $0.20 per diluted share in the prior year [6][7]. - Adjusted EBITDA reached an all-time high of $24.1 million, an increase of 8.9% year-over-year, with an adjusted EBITDA margin of 13.0% [7][12]. Operational Changes - The company reclassified certain overhead and personnel expenses from SG&A to cost of revenue, amounting to $4.8 million for Q2 2024, which provided greater transparency regarding the true cost of revenue [4]. - MISTRAS recorded $3.0 million in reorganization and other costs in Q2 2025 as part of its initiative to reduce overhead costs [5]. Cash Flow and Debt - Net cash used in operating activities was $3.5 million in the first half of 2025, a decrease from $5.1 million of net cash provided in the prior year, primarily due to an increase in days sales outstanding [7]. - Free cash flow was negative $16.2 million in the first half of 2025, compared to negative $6.9 million in the prior year [9]. - The company's gross debt increased to $189.4 million as of June 30, 2025, compared to $169.6 million at the end of 2024 [10]. Market Outlook - The company is not providing full-year guidance for fiscal 2025 as it reviews its entire portfolio of businesses, but it expects adjusted EBITDA to exceed the 2024 level [13].

Company Overview - MISTRAS Group, Inc. is a global leader in technology-enabled industrial asset integrity and testing solutions, serving critical industries such as oil & gas, aerospace & defense, power & utilities, manufacturing, and civil infrastructure [3] - The company offers a diversified portfolio of products and services, including advanced non-destructive testing, pipeline inspections, real-time condition monitoring, maintenance planning, and specialized engineering [3] - MISTRAS Group utilizes a proprietary management software suite that centralizes integrity data for predictive analytics and benchmark analysis, helping clients reduce risk, extend asset life, and optimize operational performance [3] Upcoming Events - MISTRAS Group has scheduled a conference call for August 7, 2025, at 9:00 am Eastern Time to present its second quarter results for 2025 [1] - A press release with the second quarter results will be issued after the market closes on August 6, 2025 [1] - Individuals can pre-register for the live question and answer session at a specified link [2]