1. SXI reported three QFY25 with record sales and income. 2. Operating income increased significantly by 20.2% year over year. 3. Strategic acquisitions contributed to revenue growth and margin improvements. 4. SXI remains confident in reaching long-term sales targets despite global challenges. 5. Free cash flow decreased by 81.9%, raising concerns over liquidity.
Strong financial results and operational growth indicate positive momentum. Historically, similar results led to price increases.
The article details significant financial performance and growth strategies that could influence investors' confidence in SXI.
SXI's growth in fast markets and strategic investments position it for sustained success beyond Q4 2025.
| ($M except EPS and Dividends) | 3Q25 | 3Q24 | 2Q25 | Y/Y | Q/Q |
|---|---|---|---|---|---|
| Net Sales | $207.8 | $177.3 | $189.8 | 17.2% | 9.5% |
| Operating Income – GAAP | $26.3 | $21.8 | $8.5 | 20.2% | 210.2% |
| Operating Income – Adjusted | $40.3 | $29.4 | $35.5 | 37.3% | 13.8% |
| Operating Margin % - GAAP | 12.6% | 12.3% | 4.5% | + 30 bps | + 820 bps |
| Operating Margin % - Adjusted | 19.4% | 16.6% | 18.7% | + 280 bps | + 70 bps |
| Net Income from Continuing Ops – GAAP | $21.9 | $15.9 | $0.9 | 37.6% | 2420.0% |
| Net Income from Continuing Ops – Adjusted | $23.5 | $22.3 | $23.0 | 5.6% | 2.5% |
| EBITDA | $35.7 | $28.4 | $16.1 | 25.7% | 122.0% |
| EBITDA margin | 17.2% | 16.0% | 8.5% | +120 bps | + 870 bps |
| Adjusted EBITDA | $45.3 | $34.5 | $39.6 | 31.3% | 14.4% |
| Adjusted EBITDA margin | 21.8% | 19.5% | 20.9% | + 190 bps | + 90 bps |
| Diluted EPS – GAAP | $1.81 | $1.35 | $0.07 | 35.4% | 2407.0% |
| Diluted EPS – Adjusted | $1.95 | $1.88 | $1.91 | 3.7% | 2.2% |
| Dividends per Share | $0.32 | $0.30 | $0.32 | 6.7% | 0.0% |
| Free Cash Flow | $3.5 | $19.3 | $2.2 | -81.9% | 59.1% |
| Funded Debt to EBITDA per the Credit Facility | 2.8x | 0.6x | 2.7x | 366.7% | 3.7% |
| Net Debt to EBITDA | 3.0x | 0.1x | 2.9x | NM | 3.4% |
Commenting on the quarter's results, President and Chief Executive Officer David Dunbar said, "Following strong operating performance in the fiscal second quarter, we achieved several new records in our fiscal third quarter: record sales since the divestment of the Refrigeration business in April 2020, record adjusted gross margin of 42.3%, and record adjusted operating margin of 19.4%. These results reflect the continued solid operational performance from core businesses, a full quarter of ownership of the fast-growing Amran/Narayan group, and contribution from the recent McStarlite acquisition. Our fast growth market sales totaled $60.4 million or approximately 29% of total sales and are well on track to our expectations for the fiscal year of approximately $170 million. We remain confident about the Company's exposure to positive secular trends in electrical grid, electric and hybrid vehicles, renewable energy, commercialization of space, and defense, and we are reaffirming our long-term target for fast growth market sales of $340 million plus by fiscal year 2028. In addition, we launched three additional new products in the fiscal third quarter totaling 13 year-to-date, achieving our previously committed target of over a dozen and delivering more than 2% of incremental sales."
"While we cannot predict the impact of new tariffs on global trade and economic growth, our regional presence, strong customer relationships, and our disciplined approach to pricing and productivity actions position us well to manage through these challenges. Most of our supply chain is strategically located to service regional demand. China imports to the US approximately 6% of our cost of goods sold. We plan to continue to invest in our key strategic growth priorities, while closely managing our cost structure, driving productivity and pricing actions and seeking alternate sources of supply to further reduce our imports from China. We remain on track to achieve our long-term financial targets by fiscal 2028 and remain confident in our ability to pay down debt and reduce our net leverage ratio."
"In early February, we acquired California-based McStarlite. The integration is on track, and we are excited about our expanded product breadth and forming capabilities in commercial aviation, space and defense applications. We expect the acquisition to be accretive to earnings in the first year of ownership."
In fiscal fourth quarter 2025, on a sequential basis, the Company expects slightly to moderately higher revenue, driven by the impact of recent acquisitions, higher sales into fast growth end markets, and realization of pricing initiatives. On a sequential basis, the Company expects slightly to moderately higher adjusted operating margin, benefiting from higher revenue and realization of productivity actions, partially offset by higher tariff costs and targeted investments in selling, marketing, and R&D.
| 3Q25 | 3Q24 | % Change | |
|---|---|---|---|
| Electronics ($M) | 111.3 | 80.4 | 38.4% |
| GAAP Operating Income | 25.5 | 15.7 | 62.2% |
| GAAP Operating Margin % | 22.9 | 19.5 | |
| Adjusted Operating Income* | 33.2 | 17.9 | 85.4% |
| Adjusted Operating Margin %* | 29.8 | 22.2 |
Revenue increased approximately $30.9 million or 38.4% year-on-year, reflecting a 48.1% benefit from acquisitions, partially offset by an organic decline of 8.9% and a 0.8% impact from foreign currency. The organic decline was due to continued softness in the automotive end markets in Europe and North America and in general industrial end markets. Adjusted operating income increased approximately $15.3 million or 85.4% year-on-year due to the contribution from the Amran/Narayan Group acquisition, productivity initiatives and product mix, partially offset by lower core volume.
The segment had a book-to-bill ratio of approximately 0.98 in the fiscal third quarter, with orders of approximately $109 million. Orders in Electronics core business remained flat sequentially with a continued increase in demand in the electrical grid end market served by Amran/Narayan Group.
| 3Q25 | 3Q24 | % Change | |
|---|---|---|---|
| Engraving ($M) | 30.6 | 36.3 | -15.7% |
| GAAP Operating Income | 3.1 | 6.3 | -51.2% |
| GAAP Operating Margin % | 10.0 | 17.2 | |
| Adjusted Operating Income* | 3.4 | 6.7 | -48.8% |
| Adjusted Operating Margin %* | 11.2 | 18.4 |
Revenue decreased approximately $5.7 million or 15.7% year-on-year reflecting a 12.6% organic decline, primarily due to continued softness in North America from delays in new platform rollouts, and a foreign currency impact of 3.1%. Adjusted operating income decreased approximately $3.3 million or 48.8% year-on-year due to the lower revenue. Operating deleverage was partially offset by the realization of previously announced productivity initiatives and restructuring actions.
In fiscal fourth quarter 2025, on a sequential basis, the Company expects slightly higher revenue and moderately higher adjusted operating margin due to more favorable project timing in Asia, slightly improved demand in North America and Europe, and realization of previously announced restructuring actions.
| 3Q25 | 3Q24 | % Change | |
|---|---|---|---|
| Scientific ($M) | 18.3 | 16.9 | 8.1% |
| GAAP Operating Income | 3.9 | 4.9 | -20.4% |
| GAAP Operating Margin % | 21.3 | 28.9 | |
| Adjusted Operating Income* | 4.1 | 5.1 | -19.7% |
| Adjusted Operating Margin %* | 22.6 | 30.4 |
Revenue increased approximately $1.4 million or 8.1% year-on-year reflecting a 16.1% benefit from the Custom Biogenic Systems acquisition, partially offset by organic decline of 8.0%, mostly due to lower demand from academic and research institutions that were impacted by NIH funding cuts. Adjusted operating income decreased approximately $1.0 million or 19.7% year-on-year due to organic decline partially offset by contribution from the acquisition.
In fiscal fourth quarter 2025, on a sequential basis, the Company expects slightly lower revenue and adjusted operating margin due to soft demand from academic and research institutions affected by NIH funding cuts and higher tariff costs.
| 3Q25 | 3Q24 | % Change | |
|---|---|---|---|
| Engineering Technologies ($M) | 27.4 | 20.1 | 36.2% |
| GAAP Operating Income | 3.4 | 3.5 | -3.0% |
| GAAP Operating Margin % | 12.5 | 17.5 | |
| Adjusted Operating Income* | 5.1 | 3.5 | 44.3% |
| Adjusted Operating Margin %* | 18.6 | 17.5 |
Revenue increased approximately $7.3 million or 36.2% year-on-year reflecting a 26.3% benefit from the recent McStarlite acquisition and organic growth of 9.9%, driven by more favorable project timing in the space end market and growth in sales from new products. Adjusted operating income increased approximately $1.6 million or 44.3% year-on-year reflecting the contribution from the recent acquisition and higher volume.
In fiscal fourth quarter 2025, on a sequential basis, the Company expects similar to slightly higher revenue and similar adjusted operating margin.
| 3Q25 | 3Q24 | % Change | |
|---|---|---|---|
| Specialty Solutions ($M) | 20.2 | 23.5 | -13.9% |
| Operating Income | 3.3 | 4.7 | -29.8% |
| Operating Margin % | 16.2 | 19.9 | |
| Specialty Solutions revenue decreased | approximately $3.3 million or 13.9% year-on-year, reflecting general market softness in the Display Merchandising business and in the Hydraulics business. |
Operating income decreased approximately $1.4 million or 29.8% year-on-year due to lower volume. In fiscal fourth quarter 2025, on a sequential basis, the Company expects moderately higher revenue and operating margin.
Standex will host a conference call for investors tomorrow, May 2, 2025, at 8:30 a.m. ET. On the call, David Dunbar, President, and CEO, and Ademir Sarcevic, CFO, will review the Company's financial results and business and operating highlights. Investors interested in listening to the webcast and viewing the slide presentation should log on to the "Investors" section of Standex's website under the subheading, "Events and Presentations," located at www.standex.com.
A replay of the webcast will also be available on the Company's website shortly after the conclusion of the presentation online through May 2, 2026. To listen to the teleconference playback, please dial in the U.S. (888) 660-6345 or (646) 517-4150 internationally; the passcode is 15269#. The audio playback via phone will be available through May 9, 2025. The webcast replay can be accessed in the "Investor Relations" section of the Company's website, located at www.standex.com.
In addition to the financial measures prepared in accordance with generally accepted accounting principles ("GAAP"), the Company uses certain non-GAAP financial measures, including non-GAAP adjusted income from operations, non-GAAP adjusted net income from continuing operations, free operating cash flow, EBITDA (earnings before interest, taxes, depreciation and amortization) adjusted EBITDA, adjusted EBITDA to net debt, and adjusted earnings per share. The attached financial tables reconcile non-GAAP measures used in this press release to the most directly comparable GAAP measures. The Company believes that the use of non-GAAP measures which exclude the impact of restructuring charges, purchase accounting, amortization from acquired intangible assets, insurance recoveries, discrete tax events, gain or loss on sale of a business unit, acquisition costs, and litigation costs help investors to obtain a better understanding of our operating results and prospects, consistent with how management measures and forecasts the Company's performance, especially when comparing such results to previous periods. An understanding of the impact in a particular quarter of specific restructuring costs, acquisition expenses, or other gains and losses, on net income (absolute as well as on a per-share basis), operating income or EBITDA can give management and investors additional insight into core financial performance, especially when compared to quarters in which such items had a greater or lesser effect, or no effect. Non-GAAP measures should be considered in addition to, and not as a replacement for, the corresponding GAAP measures, and may not be comparable to similarly titled measures reported by other companies.
Standex International Corporation is a multi-industry manufacturer in five broad business segments: Electronics, Engraving, Scientific, Engineering Technologies, and Specialty Solutions with operations in the United States, Europe, Canada, Japan, Singapore, Mexico, Turkey, India, and China. For additional information, visit the Company's website at http://standex.com/.
Statements contained in this Press Release that are not based on historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of forward-looking terminology such as "should," "could," "may," "will," "expect," "believe," "estimate," "anticipate," "intend," "continue," or similar terms or variations of those terms or the negative of those terms. There are many factors that affect the Company's business and the results of its operations and that may cause the actual results of operations in future periods to differ materially from those currently expected or anticipated. These factors include, but are not limited to: the impact of pandemics and other global crises or catastrophic events on employees, our supply chain, and the demand for our products and services around the world; materially adverse or unanticipated legal judgments, fines, penalties or settlements; conditions in the financial and banking markets, including fluctuations in exchange rates and the inability to repatriate foreign cash; domestic and international economic conditions, including the impact, length and degree of economic downturns on the customers and markets we serve and more specifically conditions in the electrical grid, automotive, construction, aerospace, defense, transportation, food service equipment, consumer appliance, energy, oil and gas and general industrial markets; lower-cost competition; the relative mix of products which impact margins and operating efficiencies in certain of our businesses; the impact of higher raw material and component costs, particularly steel, certain materials used in electronics parts, petroleum based products, and refrigeration components; the impact of higher transportation and logistics costs, especially with respect to transportation of goods from Asia; the impact of inflation on the costs of providing our products and services; an inability to realize the expected cost savings from restructuring activities including effective completion of plant consolidations, cost reduction efforts including procurement savings and productivity enhancements, capital management improvements, strategic capital expenditures, and the implementation of lean enterprise manufacturing techniques; the potential for losses associated with the exit from or divestiture of businesses that are no longer strategic or no longer meet our growth and return expectations; the inability to achieve the savings expected from global sourcing of raw materials and diversification efforts in emerging markets; the impact on cost structure and on economic conditions as a result of actual and threatened increases in trade tariffs; the inability to attain expected benefits from acquisitions and the inability to effectively consummate and integrate such acquisitions and achieve synergies envisioned by the Company; increased costs from acquisitions to improve and coordinate managerial, operational, financial, and administrative systems, including internal controls over financial reporting and compliance with the Sarbanes-Oxley Act of 2002, and other costs related to such systems in connection with acquired businesses; market acceptance of our products; our ability to design, introduce and sell new products and related product components; the ability to redesign certain of our products to continue meeting evolving regulatory requirements; the impact of delays initiated by our customers; our ability to increase manufacturing production to meet demand including as a result of labor shortages; the impact on our operations of any successful cybersecurity attacks; and potential changes to future pension funding requirements. For a more comprehensive discussion of these and other factors, see the "Risk Factors" section of the Company's most recent annual report on Form 10-K filed with the SEC and available on the Company's website. In addition, any forward-looking statements represent management's estimates only as of the day made and should not be relied upon as representing management's estimates as of any subsequent date. While the Company may elect to update forward-looking statements at some point in the future, the Company and management specifically disclaim any obligation to do so, even if management's estimates change.
(unaudited)
| Three Months Ended | Nine Months Ended | March 31, |
|---|---|---|
| 2025 | 2024 | Net sales |
| $207,780 | 177,267 | $568,058 |
| Cost of sales | 125,350 | 108,977 |
| Gross profit | 82,430 | 68,290 |
| Selling, general and administrative expenses | 47,564 | 39,719 |
| (Gain) loss on sale of business | - | - |
| Restructuring costs | 1,976 | 4,037 |
| Amortization of acquired intangible assets | 4,485 | 2,045 |
| Acquisition related costs | 2,152 | 537 |
| Other operating (income) expense, net | - | 110 |
| Income from operations | 26,253 | 21,842 |
| Interest expense | 8,363 | 949 |
| Other non-operating (income) expense, net | 309 | 627 |
| Total | 8,672 | 1,576 |
| Income from continuing operations before income taxes | 17,581 | 20,266 |
| Provision for income taxes | (5,197) | 4,327 |
| Net income from continuing operations | 22,778 | 15,939 |
| Income (loss) from discontinued operations, net of tax | (52) | (141) |
| Net income | 22,726 | 15,798 |
| Less: net income attributable to redeemable noncontrolling interest | 846 | - |
| Net income attributable to Standex International | $21,880 | $15,798 |