Record Sales, EBITDA, and EPS Achieved in Fiscal 2025
Applied Industrial Technologies achieved new records for sales, EBITDA, and EPS in fiscal 2025, demonstrating strong operational resilience.
Full year EPS growth of 4% exceeded initial guidance, highlighting effective management despite a muted demand environment.
Gross margins expanded nearly 50 basis points, surpassing 30% for the first time in the company's history, indicating margin improvement.
The company generated over $465 million of free cash flow, a 34% increase, enabling significant capital deployment including acquisitions and share buybacks.
The strategic acquisition of Hydradyne, its largest in 6 years, contributed over 400 basis points of inorganic growth and was a key driver of the record performance.
AAON Coil Products sales grew 86.4%, driven by a large liquid cooling project, but AAON branded products declined due to ERP disruptions.
AAON Oklahoma segment sales declined 18% with a 970 basis point gross margin contraction, impacted by supply chain disruptions and ERP-related coil shortages.
BasX segment sales grew 20.4% with a slight gross margin contraction of 60 basis points, reflecting operational improvements.
Cash and equivalents totaled $1.3 million with debt at $317.3 million and a leverage ratio of 1.4; capital expenditures increased 18.7% to $89.6 million year-to-date.
Gross margin contracted by 950 basis points to 26.6%, primarily due to lower production volumes and inefficiencies related to the ERP implementation.
Net sales declined 0.6% year-over-year to $311.6 million, driven by a 20.9% decline in AAON branded sales nearly offset by a 90% increase in BasX branded sales.
Non-GAAP adjusted EBITDA was 14.9%, down 1,120 basis points, and non-GAAP adjusted EPS was $0.22, down 64.5% year-over-year.
Adjusted EBITDA was $389 million with a margin of 26.9%, down 190 basis points due to volume deleverage, softer market conditions at CWT, higher operating costs, and strategic investments.
Adjusted EPS reached a record $6.27, slightly up from $6.24 in the prior year, supported by share repurchases and accretive acquisitions offsetting lower organic earnings.
Balance sheet remains strong with $68 million cash and net debt-to-EBITDA ratio of 1.4x; $1 billion available under revolving credit facility.
Carlisle reported second quarter 2025 revenues of $1.4 billion, essentially flat year-over-year, with acquisitions contributing $39 million in revenue.
CCM segment revenues grew approximately 1% year-over-year to $1.1 billion, with organic revenue flat; adjusted EBITDA was $346 million with a 31.6% margin, down 180 basis points.
CWT segment revenues declined 2% to $354 million, with organic revenue down 10%; adjusted EBITDA was $71 million with a 19.9% margin, down 260 basis points due to volume deleverage.
Free cash flow for the quarter was $258 million; year-to-date share repurchases totaled $700 million, with a 2025 target of $1 billion.
Dafinchi
