Q1 2025 Graham Corp Earnings Call Transcript
Key Points
- Graham Corp (GHM) achieved record quarterly sales of $50 million, marking a 5% increase over the prior year.
- The company's defense market sales reached $29.1 million, a 28% increase, setting a new quarterly record.
- Gross margin expanded by 170 basis points to 24.8%, benefiting from improved execution and pricing on defense contracts.
- Strong cash generation of $8.7 million for the quarter, with a robust balance sheet featuring $21.6 million in cash and no debt.
- The backlog remains strong at nearly $400 million, providing good visibility into future operations and stability.
- Aftermarket sales were down compared to the record levels of the prior year, despite remaining robust overall.
- SG&A expenses increased by $2 million year-over-year, driven by investments in operations, people, and technologies.
- The company faces challenges in updating its contact database for aftermarket sales due to turnover within plants and refineries.
- There are still some lower-margin first article units in the pipeline, which could impact future gross margins.
- The expansion of the Batavia facility experienced a slight delay, moving the groundbreaking from July to August.
Greetings, and welcome to Graham Corporation first quarter fiscal year 2025 financial results conference call. (Operator Instructions) As a reminder, this conference is being recorded It is now my pleasure to introduce your host, Ms. Deborah Pawlowski, Investor Relations for Graham Corporation.
Thank you. Ms. Pawlowski, you may begin.
Thank you, [Ringue], , and good morning, everyone. We certainly appreciate your time today and your interest in Graham Corporation. Here with me on the call are Dan Thoren, our President and CEO; Chris Thome, our Chief Financial Officer; and Matt Malone, Vice President of Graham Corporation and General Manager of Barber-Nichols. Dan, Chris and Matt are going to provide their formal remarks after which we will open the line for questions.
You should have a copy of the first quarter fiscal year 2025 financial results that were released this morning. I will also note that you will be seen momentarily a corrected release crossing the wires. It is correcting
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