In This Article:
Gibraltar Industries, Inc.’s ROCK first-quarter 2025 adjusted earnings topped the Zacks Consensus Estimate and grew year over year. On the other hand, net sales missed the consensus mark and tumbled year over year.
The company’s quarterly results reflect stable demand and performance in line with internal plans. Backlog increased 30% year over year to $434 million, reaching a record high. The company reported solid contributions from the Lane Supply acquisition. ROCK also carried out restructuring actions and completed two additional acquisitions in the Residential segment to expand its presence in the metal roofing market.
Despite a dynamic macro environment, the company reaffirmed its full-year 2025 earnings guidance. The company created a tariff playbook for each business earlier in the year and continues to monitor end-market and customer-demand trends. The reaffirmed guidance reflects current order rates, strong backlog in project-based businesses, expected impact of tariffs, along with planned actions, and added revenues and margin from recent acquisitions. The company also lowered its Renewables plan as the industry awaits clarity on potential changes to the benefits provided by the IRA bill.
Inside ROCK’s Headlines
The company’s adjusted EPS of 95 cents topped the Zacks Consensus Estimate of 86 cents by 10.5%. In the year-ago quarter, it reported an adjusted EPS of 80 cents. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
Gibraltar Industries, Inc. Price, Consensus and EPS Surprise
Gibraltar Industries, Inc. price-consensus-eps-surprise-chart | Gibraltar Industries, Inc. Quote
Quarterly net sales of $290 million lagged the consensus mark of $292.5 million by 0.9%. The consensus mark for the metric was the same as the prior-year level. On an adjusted basis, the top line slightly increased 0.1% year over year from $289.8 million. The ongoing industry headwinds, impacting the Renewables business, were partially offset by the Lane acquisition.
Gibraltar’s Segmental Details
Residential: Net sales in the segment were down 2.8% year over year to $180 million (down 1.3% on an adjusted basis). This downtick was due to softness in the Residential market, with retail and mail/package product sales lower in the quarter. This was largely driven by new construction from the previous year. However, building accessories sales increased due to higher participation and new product adoption.
The adjusted operating margin of 18% contracted 80 basis points (bps) in the quarter due to unfavorable volume and product mix in its mail and package business. The adjusted EBITDA margin decreased 40 bps from the prior-year quarter to 19.7%.
Renewables: Net sales in the segment decreased 15.1% from the year-ago quarter to $43.7 million. This decline was due to slower bookings in the second half of 2024, impacted by the December panel installation deadline. The order backlog was down 23% year over year. However, bookings accelerated in the first quarter, resulting in a 30% sequential increase in the backlog.
The adjusted operating margin of 3.4% contracted 50 bps year over year due to lower volume and field inefficiencies tied to the introduction and ramp-up of the 1P tracker technology. Restructuring costs, including those related to discontinuing the company's legacy tracker solution, also contributed to the margin decline. The adjusted EBITDA margin expanded 100 bps from the prior-year quarter to 9.1%.
Agtech: This segment’s net sales inched up 32.4% year over year to $45 million. The upside was backed by the contribution from the acquisition of Lane Supply. Organic sales declined 12.6% due to project delays for two Produce projects awaiting permit approval. Both projects are expected to begin construction by the end of the second quarter. Organic bookings were strong and with the addition of Lane Supply, the overall backlog increased 226% compared with the last year.
The adjusted operating margin expanded 270 bps year over year to 10.8%, attributable to productivity, project mix and project execution. The adjusted EBITDA margin also grew 330 bps year over year to 14.1%.
Infrastructure: Net sales in the segment tumbled 2.7% year over year to $21.3 million, due to project delays that pushed some shipments into the second quarter. Despite this, demand remains strong, with the backlog increasing 11%. This growth was driven by more design bids being awarded and converted into new bookings. Quoting activity continues to be solid, supported by ongoing investment and funding at both the federal and state levels.
The adjusted operating margin of 24.7% expanded 230 bps year over year, driven by strong execution, supply-chain management and product-line mix. The adjusted EBITDA margin also expanded 220 bps from the prior-year quarter to 28.2%.