AZZ Inc. reported fiscal year 2026 third‑quarter results that surpassed consensus estimates, with revenue of $425.7 million, up 5.5% year‑over‑year, and an adjusted diluted earnings per share of $1.52, a 9.4% increase over the prior year. Adjusted EBITDA rose to $91.2 million, representing 21.4% of sales, slightly below the 22.5% margin recorded a year earlier but still above the consensus estimate of $90.7 million.
The Metal Coatings segment drove the quarter’s growth, with sales climbing 15.7% to $195.0 million and an adjusted EBITDA margin of 30.3%. Precoat Metals, while experiencing a 1.8% decline in sales to $230.7 million, improved its margin to 19.7% thanks to disciplined cost management and lower operating expenses.
Compared with the same quarter a year earlier, Q3 FY2025 sales were $403.7 million and adjusted diluted EPS was $1.39. The current quarter’s 5.5% revenue growth and 9.4% EPS increase reflect a stronger mix of high‑margin Metal Coatings work and effective cost controls in Precoat Metals.
AZZ reaffirmed its fiscal 2026 outlook but narrowed the upper end of its sales guidance to $1.7 billion, setting a range of $1.625 billion to $1.7 billion. Adjusted EBITDA guidance remains $360 million to $380 million, and the company projects full‑year adjusted diluted EPS of $5.90 to $6.20, slightly below the consensus midpoint of $6.02. Management explained the tightening as a cautious response to potential demand volatility, even as the company continues to reduce debt by $35 million and repurchase $20 million of common stock.
President and CEO Tom Ferguson said, "We are pleased with the third‑quarter performance, driven by disciplined execution and strong demand in our Metal Coatings business. Our focus on debt reduction and share repurchases strengthens our balance sheet and supports long‑term shareholder value." He added that the company remains confident in its ability to maintain profitability through cost discipline and strategic investments.
Investor reaction was mixed. While the earnings beat and robust segment performance were welcomed, the narrowed fiscal guidance prompted caution among some analysts, who noted that the company’s full‑year EPS outlook sits just below consensus expectations. The market’s focus on the guidance adjustment highlights the importance of forward‑looking sentiment in evaluating the company’s trajectory.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.