Powell Industries (NasdaqGS:POWL) Q1 2026 Earnings call February 04, 2026 11:00 AM ET Company ParticipantsBrett Cope - Chairman, President, and CEOManish Somaiya - Managing DirectorMike Metcalf - EVP, CFO, Secretary, and TreasurerRyan Coleman - Head of Investor RelationsConference Call ParticipantsChip Moore - Managing Director and Senior Research AnalystJohn Braatz - Partner and Senior Equity AnalystJohn Franzreb - Senior Equity AnalystOperatorWelcome to the Powell Industries Fiscal First Quarter 2026 Earn ...

Financial Data and Key Metrics Changes - Adjusted Net Investment Income for Q1 2026 was $36.1 million, or $0.41 per share, up from $35.4 million or $0.40 per share in the prior quarter [4][19] - NAV per share decreased to $16.30 from $16.64 in the previous quarter due to unrealized depreciation on certain investments [19] - Adjusted total investment income decreased to $74.5 million from $76.9 million in the prior quarter, primarily due to lower interest income [19][20] Business Line Data and Key Metrics Changes - New funded investments totaled $314 million, up from $220 million in the prior quarter, reflecting a 42% sequential increase [6][16] - Non-accruals represented 3.1% of the total debt portfolio, stable sequentially and down nearly 85 basis points year-over-year [7][18] - The weighted average yield on debt investments was 9.3%, with first lien senior secured debt comprising 85% of the total portfolio [15][21] Market Data and Key Metrics Changes - Current trends in private credit show a bifurcation in the economy, with companies of scale having ample access to capital while struggling companies face limited access [9] - Spreads in private credit have bottomed out at SOFR +450-475 basis points, with expectations for stability in 2026 [10] - The median portfolio EBITDA increased from $150 million to $190 million sequentially, driven by new originations in larger companies [30] Company Strategy and Development Direction - The company remains focused on disciplined capital deployment into income-generating assets and reducing non-accruals to improve earnings power [5][6] - Oaktree is prioritizing loans to businesses with resilient models and defensible market positions, particularly in the software sector [10][12] - The company is monitoring the impact of AI on private credit and is cautious about potential disruptions in the software industry [11][38] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding middle-market M&A activity improving over the year, despite current lower volumes [9] - The company is focused on maintaining strong alignment with shareholders while navigating an evolving credit landscape [8] - Concerns were raised about the long-term refinanceability of loans in the software sector due to potential AI disruptions [38][39] Other Important Information - The company ended the quarter with over $576 million in available liquidity, including $81 million in cash [21][22] - The joint ventures held $511 million of investments, generating ROEs of 12% in aggregate [22] Q&A Session Summary Question: Can you provide insight into the portion of the portfolio that is underperforming? - Management indicated that underperforming assets include non-accruals and positions trading below par, with most below-par loans being public positions [24][25] Question: What drove the increase in median portfolio EBITDA? - The increase was primarily driven by new originations funded in the fourth quarter, which were larger companies, contributing to a mix shift [30] Question: Can you discuss the unrealized appreciation and markdowns in the quarter? - Pluralsight was the largest driver of markdowns, accounting for about 38% of the total mark, with some smaller marks in other private positions [32] Question: How is the company characterizing top-line growth and EBITDA trends in the software sector? - Management noted that it is too early to see performance degradation in software names, but concerns exist regarding long-term refinanceability due to AI risks [36][38]

Timken Company (NYSE:TKR) Q4 2025 Earnings call February 04, 2026 11:00 AM ET Company ParticipantsAngel Castillo - Executive Director and Head of US Machinery & Construction Equity ResearchBryan Blair - Managing DirectorChris Dankert - SVP in Equity ResearchChristian Zyla - Senior Associate Equity ResearchDavid Raso - Senior Managing Director and PartnerJoe Ritchie - Managing DirectorLucian Boldea - President and CEOMike Discenza - CFONeil Frohnapple - VP of Investor RelationsStephen Volkmann - Managing Dir ...

Financial Data and Key Metrics Changes - Adjusted Net Investment Income for Q1 2026 was $36.1 million, or $0.41 per share, up from $35.4 million or $0.40 per share in the prior quarter [4][21] - NAV per share decreased to $16.30 from $16.64 in the previous quarter due to unrealized depreciation on certain investments [21] - Adjusted total investment income decreased to $74.5 million from $76.9 million, primarily due to lower interest income [22][23] Business Line Data and Key Metrics Changes - New funded investments totaled $314 million, up from $220 million in the prior quarter, reflecting a 42% sequential increase [6][17] - Non-accruals represented 3.1% of the total debt portfolio, stable sequentially and down nearly 85 basis points year-over-year [7][20] - The average all-in spread and yield of new private investments was 525 basis points and 9%, respectively [6] Market Data and Key Metrics Changes - Current trends in private credit show a bifurcation in the economy, with companies of scale having ample access to capital while struggling companies face limited access [9] - After the Fed rate cut in September, spreads in private credit have stabilized at SOFR plus 450-475 basis points [10] - The median portfolio EBITDA increased from $150 million to $190 million sequentially, driven by new originations in larger companies [34] Company Strategy and Development Direction - The company is focused on deploying capital into income-generating assets and reducing non-accruals to improve earnings power [5][6] - There is a commitment to disciplined underwriting and selectivity in investment opportunities, particularly in resilient market-leading businesses [11][12] - The company is monitoring the impact of AI on private credit and the broader economy, emphasizing the importance of execution and speed of adoption [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the stability of spreads in 2026 and the potential for increased middle-market M&A activity [10][12] - Concerns were raised about the long-term impact of AI on software companies, particularly regarding their refinanceability [40][42] - The company remains constructive on the long-term outlook for private credit, emphasizing the importance of active portfolio management [13] Other Important Information - The company declared a quarterly cash dividend of $0.40 per share, payable on March 31, 2026 [5] - The weighted average interest rate on debt outstanding was 6.1%, down from 6.5% in the prior quarter [24] - The company has approximately $576 million in liquidity, including $81 million in cash and $495 million in undrawn capacity on its credit facility [24] Q&A Session Summary Question: Can you provide insight into the portion of the portfolio that is underperforming? - Management indicated that underperforming assets include non-accruals and positions trading below par, with most below-par loans being public positions [27][28] Question: What drove the increase in median portfolio EBITDA? - The increase was primarily driven by new originations funded in the fourth quarter, which were larger companies, contributing to a mix shift [34][35] Question: Can you discuss the unrealized appreciation and markdowns in the quarter? - The largest driver of unrealized depreciation was Pluralsight, accounting for about 38% of the total mark, with some smaller marks in other private positions [36][37] Question: How does the company view top-line growth and EBITDA trends in the software sector? - Management believes it is too early to see performance degradation in software names, but concerns exist regarding long-term refinanceability due to potential AI disruption [40][42]

Financial Data and Key Metrics Changes - Revenue grew by 4% year-over-year, reaching $251 million compared to $241 million in the same period last year [5][15] - Gross profit increased by 20% to $71 million, resulting in a gross margin of 28.4%, an improvement of 380 basis points year-over-year [5][19] - Net income rose to $41.4 million, or $3.40 per diluted share, a 19% increase from $34.8 million, or $2.86 per diluted share, in the prior year [21] - New orders booked were $439 million, a 63% increase compared to the same period last year, with a book-to-bill ratio of 1.7 times [6][16] Business Line Data and Key Metrics Changes - The commercial and other industrial market accounted for nearly half of the order total, with data centers representing approximately 15% of the total backlog [7][8] - The utility sector saw a revenue increase of 35% compared to the same period last year, while the oil and gas sector increased by 2% [18] - The petrochemical sector experienced a decline of 31% due to the completion of a large project and softer commercial activity [18] Market Data and Key Metrics Changes - Domestic revenues slightly decreased by 1% to $195 million, while international revenues increased by 29% to $44 million, driven by projects in the Middle East, Africa, Asia Pacific, and Europe [17][18] - The backlog at the end of the quarter was $1.6 billion, a sequential growth of 14% and the highest in the company's history [10][17] Company Strategy and Development Direction - The company is focused on expanding productive capacity and optimizing manufacturing processes to meet growing market demand, particularly in the LNG and data center sectors [9][11] - Strategic investments are being made in new facilities and equipment to support growth in medium voltage distribution products [12][58] - The company aims to maintain a strong presence in the electric utility and commercial markets while adapting to new market dynamics [12][60] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining strong demand across all end markets, with expectations for continued growth in 2026 [22] - The company is actively addressing potential constraints related to skilled labor shortages, which could impact growth ambitions [99] - Management remains optimistic about the commercial environment and the ability to execute on the backlog while maintaining margin levels [22][21] Other Important Information - The expansion of the Jacintoport facility is on schedule and expected to be completed in the second half of fiscal 2026, which will enhance capacity for oil and gas customers [11] - The company has no debt and reported cash and short-term investments of $501 million [21] Q&A Session Summary Question: Comments on gross margin sustainability - Management indicated that the gross margin improvement was driven by strong project closeouts and productivity, with expectations to maintain upper 20s margin levels [26][27] Question: Concerns about backlog firmness - Management expressed confidence in the durability of the $1.6 billion backlog, noting ongoing discussions with customers about project timing and capacity [28][32] Question: Data center project cadence and follow-on orders - Management discussed the project nature of data center work and the potential for increased production flow and efficiency in upcoming quarters [36][37] Question: Pricing environment and raw material costs - Management noted stable pricing across verticals and strategies to manage raw material costs through hedging and locking in prices for engineered components [44][48] Question: Lead times on components and potential constraints - Management indicated that they are well-positioned regarding capacity for various product levels, with ongoing discussions about meeting client needs [50][51] Question: Capital expenditure plans for capacity expansion - Management is considering a new facility investment of around $100 million to support growth, with expectations for double-digit revenue growth from new capacity [58][59] Question: Competitive environment in the LNG market - Management acknowledged increased competition but emphasized their focus on core strategies and the importance of maintaining relationships with clients [60][64] Question: Future cash utilization and working capital - Management indicated that a portion of the cash on hand will be allocated to new facilities and potential M&A opportunities, with a significant portion of the backlog requiring working capital [76][80]

American Assets Trust (NYSE:AAT) Q4 2025 Earnings call February 04, 2026 11:00 AM ET Company ParticipantsAdam Wyll - CEOMeliana Leverton - Associate General CounselRobert Barton - CFOSteve Center - EVPConference Call ParticipantsDylan Burzinski - Senior AnalystHaendel St. Juste - Managing Director & Senior Equity Research AnalystTodd Thomas - Managing Director & Senior Equity Research AnalystNone - AnalystOperatorAnd welcome to the American Assets Trust, Inc.'s fourth quarter and year-end 2025 earnings conf ...

Financial Data and Key Metrics Changes - Revenue for Q1 2026 increased by 4% year-over-year, reaching $251 million compared to $241 million in Q1 2025 [5][13] - Gross profit rose by 20% to $71 million, resulting in a gross margin of 28.4%, an improvement of 380 basis points year-over-year [5][18] - Net income for Q1 2026 was $41.4 million, or $3.40 per diluted share, a 19% increase from $34.8 million, or $2.86 per diluted share in Q1 2025 [20] Business Line Data and Key Metrics Changes - New orders booked in Q1 2026 totaled $439 million, a 63% increase from the same period last year, including significant orders in LNG and data centers [5][13] - The commercial and other industrial market accounted for nearly half of the total orders, with a notable mega order for a data center valued at approximately $75 million [6][15] - The backlog at the end of Q1 2026 was $1.6 billion, a sequential growth of 14% and the highest in the company's history [9][16] Market Data and Key Metrics Changes - Domestic revenues decreased slightly by 1% to $195 million, while international revenues increased by 29% to $44 million, driven by projects in the Middle East, Africa, Asia Pacific, and Europe [16][17] - Utility sector revenues increased by 35% year-over-year, while oil and gas sector revenues rose by 2%, contrasting with a 31% decline in the petrochemical sector [17] Company Strategy and Development Direction - The company is focused on expanding productive capacity and optimizing manufacturing processes to meet growing demand, particularly in the LNG and data center markets [8][10] - Strategic investments are being made in facilities and equipment to support growth in medium voltage distribution products and to enhance overall capacity [11][21] - The company aims to maintain a robust backlog and capitalize on favorable market conditions across all major end markets [12][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining strong revenue and earnings growth throughout fiscal 2026, supported by a healthy backlog and positive market dynamics [21] - The company anticipates continued investment in electrical infrastructure to meet rising demand levels, particularly in the LNG and data center sectors [12][21] - Concerns regarding skilled labor shortages were acknowledged, with management actively working to address these challenges [100] Other Important Information - The company has no debt and reported cash and short-term investments of $501 million at the end of Q1 2026 [20] - The expansion of the Jacintoport facility is on schedule, expected to be completed in the second half of fiscal 2026, which will enhance capacity for LNG project support [10] Q&A Session Summary Question: Comments on gross margin sustainability - Management indicated that the gross margin improvement was driven by strong project execution and favorable closeouts, with expectations to maintain margins in the upper 20s [26][27] Question: Concerns about backlog firmness - Management expressed confidence in the durability of the $1.6 billion backlog, noting ongoing discussions with customers about capacity reservations [28][30] Question: Data center project cadence and follow-on orders - Management highlighted the potential for increased production flow and efficiency in data center projects, with ongoing evaluations for additional facilities to support demand [38][39] Question: Pricing environment and raw material costs - Management noted stable pricing across verticals, with strategies in place to manage raw material costs through hedging and locking in prices for engineered components [46][50] Question: Capacity ramp-up and future revenue growth - Management discussed potential capital expenditures for new facilities and indicated that double-digit revenue growth is possible with the new capacity [61][62] Question: Competitive environment in the LNG market - Management acknowledged an intense competitive landscape but emphasized their focus on core strategies and the importance of maintaining relationships with clients [63][64] Question: Cash on the balance sheet and working capital - Management indicated that a portion of the cash would be allocated to new facilities and that approximately 40%-50% of the cash balance would be deployed to support the backlog [82][84]

Fourth Quarter and Full Year 2025 Earnings EARNINGS PRESENTATION February 4, 2026 Forward Looking Statements and Non-GAAP Financial Measures FORWARD-LOOKING STATEMENTS Statements in this presentation that are not strictly historical, including statements regarding anticipated financial results, global and regional economic conditions, industry trends, geopolitical events, future acquisitions, impact of trade and spending policies, the ability to execute the planned strategies, interest rate and current exch ...

Financial Data and Key Metrics Changes - Adjusted Net Investment Income for Q1 2026 was $36.1 million, or $0.41 per share, a modest increase from $35.4 million or $0.40 per share in the prior quarter [3][20] - NAV per share decreased to $16.30 from $16.64 in the previous quarter due to unrealized depreciation on certain investments [20] - Adjusted total investment income decreased to $74.5 million from $76.9 million, primarily due to lower interest income [20][21] - Net leverage ratio increased to 1.07 times from 0.97 times, reflecting strong deployments during the quarter [22] Business Line Data and Key Metrics Changes - New funded investments totaled $314 million, up from $220 million in the prior quarter, indicating a 42% sequential increase [5][16] - Non-accruals represented 3.1% of the total debt portfolio, stable sequentially and down nearly 85 basis points year-over-year [5][19] - The weighted average yield on debt investments was 9.3%, with first lien senior secured debt comprising 85% of the total portfolio [15][22] Market Data and Key Metrics Changes - The private credit market is experiencing a bifurcation, with companies of scale and profitability having ample access to capital, while struggling companies face limited access [8] - Spreads in private credit have bottomed out at SOFR plus 450-475 basis points, with expectations for stability in 2026 [9][10] - Median portfolio EBITDA increased from $150 million to $190 million sequentially, driven by new originations of larger companies [33] Company Strategy and Development Direction - The company is focused on disciplined capital deployment into income-generating assets and reducing non-accruals to improve earnings power [4][5] - There is a commitment to strong alignment with shareholders while navigating an evolving credit landscape [6] - The company is prioritizing loans to businesses with resilient models and defensible market positions, particularly in the software sector [10][12] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the middle-market M&A activity improving over the year, despite current lower volumes [8] - The impact of AI on private credit is being closely monitored, with expectations of uneven outcomes across different players [10][11] - The company remains constructive on the long-term outlook for private credit, emphasizing disciplined underwriting and active portfolio management [12] Other Important Information - The company declared a quarterly cash dividend of $0.40 per share, payable on March 31, 2026 [4] - The company ended the quarter with over $576 million in available liquidity, including $81 million in cash [23] Q&A Session Summary Question: Can you provide insight into the portion of the portfolio that is underperforming? - Management indicated that underperforming assets include non-accruals and positions trading below par, with most stress observed in public positions [26][27] Question: What drove the increase in median portfolio EBITDA? - The increase was primarily driven by new originations funded in the fourth quarter, which were larger companies, contributing to a mix shift [33] Question: Can you elaborate on the unrealized appreciation and markdowns in the quarter? - The largest driver of unrealized depreciation was Pluralsight, accounting for about 38% of the total mark, with some smaller marks in other private positions [35] Question: How does the company view top-line growth and EBITDA trends in the software sector? - Management noted that it is too early to see performance degradation in software names, but concerns exist regarding long-term refinanceability due to potential AI disruption [39][40]

RenaissanceRe (NYSE:RNR) Q4 2025 Earnings call February 04, 2026 11:00 AM ET Speaker2Good morning. My name is Nikki, and I will be your conference operator today. At this time, I would like to welcome everyone to the RenaissanceRe fourth quarter and year-end 2025 earnings conference call and webcast. After the prepared remarks, we will open the call for your questions. Instructions will be given at that time. Lastly, if you should need operator assistance, please press star zero. Thank you. I will now turn ...