Core Molding Gross Margin Reaches 20.3% of Sales

The Tip Desk · August 4, 2026 · 4 min read

Second-quarter net revenue was $62.7 million as truck product sales stayed soft and tooling project revenue fell to $1.8 million.

Core Molding Technologies (CMT), an engineered materials company that molds structural products for trucks, powersports, building products and industrial and utilities customers, reported second-quarter net revenue of $62.7 million, down from $79.2 million a year earlier.

Production revenue was $60.9 million, down 1.2% from a year earlier. The company said the drop was due entirely to the truck vertical. Excluding truck, production revenue rose 20.8%. Medium and heavy-duty truck product revenue was $24.2 million. Power sports product revenue was $15.2 million, building products $6.3 million, industrial and utilities $6.2 million, and all other product revenue $9.0 million.

Tooling project revenue was $1.8 million, compared with $17.6 million a year earlier. President and Chief Executive Officer Eric Palomaki said tooling revenue remains project-driven, with larger customer acceptances anticipated in the fourth quarter.

Gross margin was $12.7 million, or 20.3% of net revenues, versus 18.1% a year earlier. The company said the improvement reflected a favorable product mix, operating efficiencies and a one-time customer capacity credit. Excluding that credit, gross margin was 19.4%. The rate was little changed from 20.4% in the first quarter.

Selling, general and administrative expenses were $10.4 million, or 16.6% of net revenues, versus $9.1 million, or 11.5%, a year earlier. The quarter included $1.8 million of non-recurring costs tied to the Mexico expansion and severance. Operating income was $2.3 million, or 3.7% of net revenues, compared with $5.2 million, or 6.6%, a year earlier. Net income was $1.8 million, or $0.21 a share, versus $4.1 million, or $0.47 a share. Adjusted net income was $3.3 million, or $0.39 a share. Adjusted EBITDA was $7.6 million, or 12.2% of net revenues.

Palomaki said production sales in medium- and heavy-duty truck markets remained soft as expected, and that momentum in powersports, building products and industrial and utilities mostly offset that weakness. The company secured a significant award for battery energy storage systems during the quarter.

First-half 2026 new business wins totaled $25.7 million. The company said 100% of those awards were net new business rather than replacement volume, and about 65% originated from markets outside traditional truck and powersports. Seventy-four percent of the new business will be produced in the U.S. footprint. Palomaki said the awards further diversify the revenue base and reduce reliance on historically cyclical end markets.

For the six months ended June 30, 2026, production revenue was $118.4 million, down 3.5% year over year, with the decline attributed entirely to truck; excluding truck, production revenue rose 20.7%. Tooling project revenue was $3.0 million. Six-month gross margin was $24.7 million, or 20.4% of net revenues. Six-month SG&A was $21.6 million, or 17.8% of net revenues, including $4.8 million of non-recurring Mexico expansion and severance costs. Operating income was $3.1 million, or 2.5% of net revenues. Net income was $2.4 million, or $0.27 a share. Adjusted EBITDA was $15.0 million, or 12.3% of net revenue.

Capital expenditures for the first six months were $12.1 million, including $9.6 million for the Mexico expansion. Free cash flow was negative $5.0 million. Cash was $12.1 million at June 30, 2026, down from $38.1 million at year-end 2025. The company repaid the remaining 2022 Huntington Term Loan during the quarter and terminated an interest-rate swap. In July 2026 it amended credit facilities to a $50 million revolving credit facility and a $50 million delayed-draw term loan, both maturing in July 2031.

Full-year 2026 capital spending is expected at about $25 million to $30 million, including $18 million to $20 million for Mexico. Trailing-twelve-month return on capital employed was 5.7%, and 6.2% excluding cash.

The company continues to expect 2026 total net sales in a flat-to-approximately 5% growth range, including production and tooling project revenue, and a 17% to 19% gross-margin range depending on mix and the split between production and tooling. It continues to anticipate a gradual recovery in the truck market during the second half of 2026.