Federal Signal Reports Strong Q3 and Nine-Month Financial Results with 6% and 9% Sales Growth

Federal Signal Corporation reported strong financial performance for the third quarter and the first nine months of 2024, with significant increases in net sales, gross profit, and net income compared to the same periods in 2023.

For the three months ended September 30, 2024, net sales reached $474.2 million, a 6% increase from $446.4 million in the prior year. The nine-month figures also showed a robust growth of 9%, with net sales totaling $1,389.5 million compared to $1,274.3 million in 2023. The growth was primarily driven by higher sales volumes and pricing actions, particularly in the Environmental Solutions Group, which saw a 7% increase in sales, bolstered by strong demand for dump truck bodies, sewer cleaners, and street sweepers.

Gross profit for the third quarter increased to $140.4 million, up from $117.7 million, reflecting a gross profit margin of 29.6%, compared to 26.4% in the prior-year quarter. For the nine months, gross profit rose to $400.4 million, a 21% increase from $330.8 million in 2023. Operating income for the third quarter was $75.9 million, a 21% increase from $62.5 million, while for the nine months, it reached $211.3 million, up 31% from $161.4 million.

Net income for the third quarter was $53.9 million, compared to $43.3 million in the same period last year, and for the nine months, it increased to $166.3 million from $111.0 million. Basic earnings per share for the third quarter rose to $0.88 from $0.71, and for the nine months, it increased to $2.73 from $1.83.

The company also completed the acquisition of Standard Equipment Company on October 4, 2024, for an initial purchase price of $38.8 million, which is expected to enhance its aftermarket growth strategy. Additionally, Federal Signal's cash and cash equivalents increased to $73.7 million as of September 30, 2024, up from $61.0 million at the end of 2023.

Despite the positive financial results, total orders for the third quarter decreased by $24 million, or 5%, compared to the prior-year quarter, indicating potential challenges in maintaining order growth. The company’s total backlog as of September 30, 2024, was $1.03 billion, reflecting a 3% increase from the previous year.

Overall, Federal Signal Corporation's financial results for the third quarter and nine months ended September 30, 2024, demonstrate a solid performance with significant growth in sales, profitability, and strategic acquisitions, positioning the company favorably in its market segments.