In This Article:
-
Revenue Growth: Increased by 3.7% year-on-year.
-
Adjusted EBITDA: Grew by 12% with 150 basis points of margin expansion.
-
Adjusted EPS: Increased by 10% to $1.38.
-
HVAC Segment Revenue: Grew 6.8% year-on-year; organic growth of 4.4%.
-
Detection & Measurement Segment Revenue: Declined 2% year-on-year; organic decline of 6.9%.
-
Segment Income: Increased by $10.7 million, or 10.7%, to $110.5 million.
-
Segment Margin: Increased by 140 basis points.
-
Cash Position: Ended Q1 with $182 million in cash.
-
Total Debt: $960 million.
-
Leverage Ratio: 1.6x, excluding KTS acquisition; 1.9x including Sigma and Omega acquisition.
-
Adjusted Free Cash Flow: Approximately $36 million.
-
Full Year Adjusted EPS Guidance: Updated to $6.10 to $6.40, reflecting 12% growth at the midpoint.
-
Adjusted EBITDA Growth Guidance: Anticipated growth of 15% at the midpoint.
Release Date: May 01, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
SPX Technologies Inc (NYSE:SPXC) reported a strong start to 2025 with a 12% increase in adjusted EBITDA and a 10% rise in adjusted EPS for the first quarter.
-
The company successfully acquired Sigma and Omega, enhancing its HVAC segment and positioning it for further growth.
-
SPX Technologies Inc (NYSE:SPXC) raised its full-year adjusted EPS guidance, reflecting strong Q1 performance and the acquisition of Sigma and Omega.
-
The company has a diverse set of end market drivers and a high level of replacement revenue, which helps mitigate the impact of economic downturns.
-
SPX Technologies Inc (NYSE:SPXC) continues to advance its new product initiatives, such as the Venstar 5 ticket vending machine, which has received positive customer feedback and significant sales.
Negative Points
-
The current tariff environment poses a challenge, with an estimated net impact of $0.08 to $0.12 on adjusted EPS.
-
The Detection & Measurement segment experienced a 2% year-on-year revenue decline, driven by the timing of project deliveries.
-
The company faces higher interest costs due to borrowings for the Sigma and Omega acquisition.
-
Organic revenue in the Detection & Measurement segment declined by 6.9%, partially offset by acquisitions.
-
The company anticipates a modest impact on adjusted EPS in Q2 due to higher interest costs, corporate expenses, and share count.
Q & A Highlights
Q: Can you walk through what you're assuming in terms of the gross and net tariff impact for the year? It looks like you implicitly cut the organic EBITDA guidance for the rest of the year by about $5 million. Is that the right way to think about the tariff impact? A: Yes. The tariff impact is estimated at $0.08 to $0.12, translating to a net cost of about $6 million at the midpoint. The gross cost is around $20 million, offset by approximately $14 million from price adjustments and surcharges. - Mark Carano, CFO