Standex International reports record fourth-quarter adjusted earnings
The company achieved a record adjusted EPS of $2.45 for the quarter ended June 30.
Standex International (SXI), the industrial manufacturer, reported a record adjusted earnings per share of $2.45 in the fourth quarter, a 7.4% increase from $2.21 in the same period last year.
The results capped a fiscal year 2026 defined by record profitability and organic growth of 5.5%. Total sales for the full year increased by more than $100 million compared to fiscal year 2025, while the company achieved an adjusted gross margin of 42.0% and an adjusted operating margin of 19.4%.
Growth was led by the Electronics segment, where revenue rose 12.1% to $129.1 million in the fourth quarter. This result was driven by 12.9% organic growth, though the segment's adjusted operating margin compressed to 27.2% from 28.5% in the prior-year period.
The Aerospace & Defense segment saw revenue increase 18.3% to $37.9 million, with adjusted operating margin expanding to 22.5% from 18.4%. Similarly, the Scientific segment reported revenue growth of 5.0% to $18.8 million, with adjusted operating margin rising to 28.6% from 24.3%. These gains were offset by the Engraving & Hydraulics segment, which saw revenue decline 9.7% to $42.4 million.
Standex expects mid-to-high single digit sales growth for fiscal year 2027. This will be driven by high-single digit to low-double digit organic growth, though results will be partially offset by foreign exchange and the divestiture of Federal Industries.
Cash flow from operations improved as free cash flow rose to $35.0 million in the fourth quarter from $24.9 million a year earlier. The company also reduced its net leverage ratio to 1.8x from 2.6x in the prior-year quarter.
Capital expenditures for the fourth quarter were $5.5 million, down from $8.6 million in the previous year. However, the company projects fiscal year 2027 capital expenditures to increase to between $45 million and $55 million, up from $28.6 million in fiscal year 2026, to fund capacity expansion in Standex Electronics Grid.
On July 2, the company acquired the remaining 9.9% interest in Narayan for approximately $64 million.