Financial Data and Key Metrics Changes - Enerpac Tool Group reported fiscal 2025 revenue of $617 million, an increase of 5% year-over-year, with organic growth of 1% after adjusting for foreign exchange and the acquisition of DTA [6][10] - Adjusted EBITDA for the year grew by 4% to $154 million, representing a margin of 24.9% [10][12] - Adjusted earnings per share increased by 5% to $1.81 compared to $1.72 in fiscal 2024 [10][12] - For the fourth quarter, revenue was up 6%, but organic revenue declined approximately 2% [10][11] Business Line Data and Key Metrics Changes - The IT&S business saw a 1% organic revenue increase for the year, while including DTA, revenue increased by 4% [6] - DTA's full-year revenue reached $20 million, with a strong fourth quarter performance contributing $9 million [6][11] - E-commerce business grew by 32% in fiscal 2025, indicating strong traction with customers [4] Market Data and Key Metrics Changes - Growth was observed in two of the three regions, with low single-digit growth in the Americas and strong high single-digit growth in APAC [7] - In APAC, growth was driven by solid performance in standard products and even better growth in heavy lifting technology (HLT) [7] - The EMEA region experienced a mid-single-digit decline, primarily due to ongoing economic weakness in Central and Southern Europe [8][9] Company Strategy and Development Direction - The company is cautiously optimistic about fiscal 2026, with expectations of lower interest rates and healthy activity in the infrastructure sector [4] - Enerpac continues to invest in its Powering Enerpac Performance (PEP) initiatives to drive continuous improvement and operational capabilities [16] - The company is focusing on capturing more differentiated and value-added service opportunities, including transitioning to a direct business model in certain countries [16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging and dynamic environment marked by weakness in the industrial sector and economic uncertainty [3] - There is cautious optimism regarding the macroeconomic environment, with potential improvements in tariff policies and infrastructure activity [4][44] - The company expects to maintain price-cost neutrality for the full fiscal year despite anticipated margin pressures in the first quarter [15][47] Other Important Information - The company repurchased a record $40 million in stock during the fourth quarter, totaling $69 million for fiscal 2025 [4][12] - Enerpac's net debt was $38 million at year-end, resulting in a net debt-to-adjusted EBITDA ratio of 0.3x, indicating strong financial flexibility [12][13] - Initial guidance for fiscal 2026 anticipates revenue of $635 million to $655 million, with organic growth of 1% to 4% [13][14] Q&A Session Summary Question: EMEA market conditions - Management indicated that the EMEA market weakness is primarily in Europe, particularly Central and Southern Europe, with challenges from macroeconomic factors and service business comparisons [27][28] Question: E-commerce performance - E-commerce has been rolled out globally, with strong growth in the U.S. and expansion into European and Australian markets [31] Question: DTA integration and growth opportunities - DTA has shown robust performance, particularly in the U.S. market, with significant cross-selling opportunities to existing Enerpac customers [32][33] Question: Overall pipeline of opportunities - The pipeline is viewed similarly to the previous year, with uncertainty in the macro environment but optimism around infrastructure projects [42][44] Question: M&A outlook - The company remains active in M&A, with a healthy balance sheet and an increasing number of opportunities in the funnel [58][60] Question: Growth in APAC and second brand strategy - APAC growth was driven by strong performance in India and Australia, with continued expectations for growth in the second brand strategy [61][62] Question: Balancing M&A and share repurchases - The company will be opportunistic with share repurchases while continuing to focus on M&A opportunities [70][72]