Gorman-Rupp Reports Mixed Q3 Results with Net Sales Growth and Improved Profitability

Gorman-Rupp Company reported its financial results for the third quarter and the first nine months of 2024, showing mixed performance in net sales and profitability compared to the previous fiscal period.

For the three months ended September 30, 2024, net sales reached $168.2 million, a slight increase of 0.4% from $167.5 million in the same period of 2023. However, for the nine months ended September 30, 2024, net sales decreased to $497.0 million from $498.9 million, reflecting a decline of 0.4%. The municipal market saw a notable increase in sales, attributed to domestic flood control and wastewater projects, while the fire suppression and industrial markets experienced declines due to a return to normal backlog levels and slower construction activity, respectively.

Gross profit for the third quarter of 2024 was $52.7 million, up from $48.1 million in the prior year, resulting in a gross margin improvement to 31.3% from 28.7%. This improvement was driven by a reduction in the cost of materials and better labor and overhead leverage. For the nine-month period, gross profit increased to $155.1 million, with a gross margin of 31.2%, compared to $145.3 million and 29.1% in 2023.

Operating income for the third quarter rose to $23.9 million, compared to $21.9 million in the same quarter of 2023, while for the nine months, it increased to $70.4 million from $65.3 million. The operating margin improved to 14.2% from 13.1% year-over-year, primarily due to lower material costs, although SG&A expenses increased.

Net income for the third quarter of 2024 was $12.9 million, or $0.49 per share, compared to $9.0 million, or $0.34 per share, in the prior year. For the nine months, net income rose to $29.1 million from $26.0 million, with earnings per share increasing to $1.11 from $0.99.

As of September 30, 2024, total current assets were $240.6 million, up from $236.1 million at the end of 2023, while total assets decreased to $883.5 million from $890.4 million. Total liabilities also decreased to $516.1 million from $540.9 million, and total equity rose to $367.3 million from $349.5 million.

The company maintained a backlog of $207.8 million as of September 30, 2024, down from $237.5 million a year earlier. Incoming orders for the first nine months of 2024 totaled $496.1 million, a 4.1% increase compared to the same period in 2023.

Gorman-Rupp also announced a quarterly dividend of $0.185 per share, marking its 299th consecutive dividend. The company is undergoing a leadership transition, with Jeffrey S. Gorman set to move from Executive Chairman to Chairman of the Board effective January 3, 2025.