AZZ Inc. Reports Fiscal Year 2026 Second Quarter Results

Solid Quarterly Results Highlight Growth in Sales, EPS and Cash Flow

Fiscal Year 2026 Guidance Remains Unchanged

FORT WORTH, Texas, Oct. 8, 2025 /PRNewswire/ -- AZZ Inc. (NYSE: AZZ), the leading independent provider of hot-dip galvanizing and coil coating solutions, today announced financial results for the second quarter ended August 31, 2025. 

Fiscal Year 2026 Second Quarter Overview (as compared to prior fiscal year second quarter⁽¹⁾):

• Total Sales of $417.3 million, up 2.0%
  • Metal Coatings sales of $190.0 million, up 10.8%
  • Precoat Metals sales of $227.3 million, down 4.3%
• Net Income of $89.3 million, up 152.3%; Adjusted net income of $46.9 million, up 13.8%
• GAAP diluted EPS of $2.95 per share, up 150.0%; Adjusted diluted EPS of $1.55, up 13.1%
• Consolidated Adjusted EBITDA of $88.7 million or 21.3% of sales, versus prior year of $91.9 million, or 22.5% of sales
• Segment Adjusted EBITDA margin of 30.8% for Metal Coatings and 20.2% for Precoat Metals
• Infrastructure Solutions Adjusted EBITDA of $(2.3) million, excluding the gain and other adjustments
• Cash provided by operating activities in the quarter of $58.4 million, up 23% from last year
• Completed the acquisition of a galvanizing facility in Canton, Ohio for $30.1 million
• Cash dividend of $0.20 per share to common shareholders paid during the quarter

Tom Ferguson, President, and Chief Executive Officer of AZZ, commented, "Second quarter sales expanded to $417.3 million, up 2.0% over the prior year, and generated adjusted diluted EPS of $1.55, up 13.1%. Metal Coatings delivered strong, double-digit sales gains on volume increases, while Precoat Metals' experienced weaker demand in several end markets. Infrastructure-driven project spending drove Metal Coatings second quarter results, supported by growth in construction, industrial, and electrical transmission and distribution end-markets. In line with broader industry trends, Precoat Metals' sales results were pressured by building construction, HVAC, and appliance end-markets. Adjusted EBITDA of $88.7 million or 21.3% of sales was down $3.1 million from the prior year same quarter, primarily attributable to the Welding Service's business within AVAIL and their normal slow summer season. On a year-to-date basis, sales increased $17.0 million, or 2.1% over prior year and Adjusted EBITDA increased $9.2 million, or 4.9% over prior year. We continue to have confidence that our full-year 2026 financial guidance is achievable, as we carefully monitor customer trends in key markets.

"During the quarter we continued to strengthen our balance sheet. We introduced an Accounts Receivable securitization program to our capital structure, successfully repriced our Term Loan B, achieving a 75-basis point reduction, and achieved a modest debt paydown in the quarter. We are pleased to maintain a net debt leverage of 1.7x at the end of the quarter, after closing on an acquisition and increasing our cash dividend. The second quarter's performance generated $58.4 million cash from operations, and we will continue to closely manage working capital, capital expenditures, and debt as we progress through the second half of our fiscal year. Our pipeline of M&A opportunities remains robust, reflecting the strength of our strategy and our disciplined approach to pursuing high-quality acquisition targets. Finally, I want to thank all of our dedicated AZZ employees for their hard work, disciplined focus and pride and passion for delivering outstanding quality and service to our customers." Ferguson concluded.

Segment Performance

Second Quarter 2026 Metal Coatings
Sales of $190.0 million increased by 10.8% over the second quarter of last year, primarily due to increased volume supported by infrastructure-related project spending in several end markets, including construction, industrial, and electrical transmission and distribution. Segment Adjusted EBITDA of $58.5 million resulted in Adjusted EBITDA margin of 30.8%, a decrease of 90 basis points from the prior year second quarter due to a higher mix of electrical, solar, transmission and distribution projects.

Second Quarter 2026 Precoat Metals
Sales of $227.3 million decreased by 4.3% compared to the second quarter of last year, primarily due to weaker end markets, including building construction, HVAC, and appliance. Segment EBITDA of $45.9 million resulted in EBITDA margin of 20.2%, a decrease of 90 basis points from the prior year second quarter, primarily due to the lower volume.

Balance Sheet, Liquidity and Capital Allocation
The Company generated significant operating cash of $373.2 million for the first six months of fiscal year 2026 through improved earnings, which included a distribution of $273.2 million from the AVAIL JV following the sale of its Electrical Products Group, coupled with a continued focus on working capital management. At the end of the second quarter, the Company's net leverage was 1.7x trailing twelve months Adjusted EBITDA. During the first six months of fiscal year 2026, the Company paid down debt of $290.4 million and returned cash to common shareholders through cash dividend payments totaling $11.1 million. The Company completed a $30.1 million acquisition during the quarter as part of its capital allocation strategy. Capital expenditures for the first six months of fiscal year 2026 were $40.2 million, and full fiscal year capital expenditures are expected to be approximately $60 - $80 million. 

Financial Outlook — Fiscal Year 2026 Guidance Remains Unchanged
We are maintaining our fiscal year 2026 guidance, which reflects our best estimates given anticipated market conditions for the full year, lower interest expense, an annualized effective tax rate of 24% and excludes M&A activity and any federal regulatory changes that may emerge.

Conference Call Details
AZZ Inc. will conduct a live conference call with Tom Ferguson, Chief Executive Officer, Jason Crawford, Chief Financial Officer, and David Nark, Chief Marketing, Communications, and Investor Relations Officer to discuss financial results for the second quarter of the fiscal year 2026, Thursday, October 9, 2025, at 11:00 A.M. ET. Interested parties can access the conference call by dialing (844) 855-9499 or (412) 317-5497 (international). A webcast of the call will be available on the Company's Investor Relations page at http://www.azz.com/investor-relations. 

A replay of the call will be available at (877) 344-7529 or (412) 317-0088 (international), replay access code: 3920463 through October 16, 2025, or by visiting http://www.azz.com/investor-relations for the next 12 months.

About AZZ Inc.
AZZ Inc. is the leading independent provider of hot-dip galvanizing and coil coating solutions to a broad range of end-markets in North America. Collectively, our business segments provide sustainable, unmatched metal coating solutions that enhance the longevity and appearance of buildings, products and infrastructure that are essential to everyday life. 

Safe Harbor Statement
Certain statements herein about our expectations of future events or results constitute forward-looking statements for purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by terminology such as "may," "could," "should," "expects," "plans," "will," "might," "would," "projects," "currently," "intends," "outlook," "forecasts," "targets," "anticipates," "believes," "estimates," "predicts," "potential," "continue," or the negative of these terms or other comparable terminology. Such forward-looking statements are based on currently available competitive, financial, and economic data and management's views and assumptions regarding future events. Such forward-looking statements are inherently uncertain, and investors must recognize that actual results may differ from those expressed or implied in the forward-looking statements. Forward-looking statements speak only as of the date they are made and are subject to risks that could cause them to differ materially from actual results. Certain factors could affect the outcome of the matters described herein. This press release may contain forward-looking statements that involve risks and uncertainties including, but not limited to, changes in customer demand for our manufactured solutions, including demand by the construction markets, the industrial markets, and the metal coatings markets. We could also experience additional increases in labor costs, components and raw materials including zinc and natural gas, which are used in our hot-dip galvanizing process, paint used in our coil coating process; supply-chain vendor delays; customer requested delays of our manufactured solutions; delays in additional acquisition opportunities; an increase in our debt leverage and/or interest rates on our debt, of which a significant portion is tied to variable interest rates; availability of experienced management and employees to implement AZZ's growth strategy; a downturn in market conditions in any industry relating to the manufactured solutions that we provide; economic volatility, including a prolonged economic downturn or macroeconomic conditions such as inflation or changes in the political stability in the United States and other foreign markets in which we operate; tariffs, acts of war or terrorism inside the United States or abroad; and other changes in economic and financial conditions. AZZ has provided additional information regarding risks associated with the business, including in Part I, Item 1A. Risk Factors, in AZZ's Annual Report on Form 10-K for the fiscal year ended February 28, 2025, and other filings with the SEC, available for viewing on AZZ's website at www.azz.com and on the SEC's website at www.sec.gov. You are urged to consider these factors carefully when evaluating the forward-looking statements herein and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. These statements are based on information as of the date hereof and AZZ assumes no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise.

Company Contact:
David Nark, Chief Marketing, Communications, and Investor Relations Officer
AZZ Inc.
(817) 810-0095
www.azz.com 

Investor Contact:
Sandy Martin / Phillip Kupper
Three Part Advisors
(214) 616-2207 or (817) 368-2556
www.threepa.com 

AZZ Inc.
Non-GAAP Disclosure
Adjusted Net Income, Adjusted Earnings Per Share and Adjusted EBITDA

In addition to reporting financial results in accordance with Generally Accepted Accounting Principles in the United States ("GAAP"), we provide adjusted net income, adjusted earnings per share and Adjusted EBITDA (collectively, the "Adjusted Earnings Measures"), which are non-GAAP measures. Management believes that the presentation of these measures provides investors with greater transparency when comparing operating results across a broad spectrum of companies, which provides a more complete understanding of our financial performance, competitive position, prospects for future capital investment and debt reduction. Management also believes that investors regularly rely on non-GAAP financial measures, such as adjusted net income, adjusted earnings per share and Adjusted EBITDA to assess operating performance and that such measures may highlight trends in our business that may not otherwise be apparent when relying on financial measures calculated in accordance with GAAP.

Management defines adjusted net income and adjusted earnings per share to exclude: 1) intangible asset amortization, 2) restructuring charges, 3) retirement and other severance expenses, 4) redemption premium on Series A Preferred Stock, 5) additional stock compensation expense related to the adoption of our executive retiree long-term incentive program, and 6) certain adjustments related to the Company's unconsolidated joint venture from the reported GAAP measure. Management defines Adjusted EBITDA as adjusted net income excluding depreciation, amortization, interest, provision for income taxes and Series A Preferred Stock dividends. Management believes Adjusted EBITDA is used by investors to analyze operating performance and evaluate the Company's ability to incur and service debt, as well as its capacity for making capital expenditures in the future. 

Management provides non-GAAP financial measures for informational purposes and to enhance understanding of the Company's GAAP consolidated financial statements. Readers should consider these measures in addition to, but not instead of or superior to, the Company's financial statements prepared in accordance with GAAP, and undue reliance should not be placed on these non-GAAP financial measures. Additionally, these non-GAAP financial measures may be determined or calculated differently by other companies, limiting the usefulness of those measures for comparative purposes.

The following tables provide a reconciliation for the three and six months ended August 31, 2025 and August 31, 2024 between the non-GAAP Adjusted Earnings Measures to the most comparable measures, calculated in accordance with GAAP (in thousands, except per share data):

Adjusted Net Income and Adjusted Earnings Per Share

Adjusted EBITDA

Adjusted EBITDA by Segment

Debt Leverage Ratio Reconciliation

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SOURCE AZZ, Inc.