Crane Company — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total sales reached $754.6 million, a 28.1% year-over-year increase, driven by 7.7% core growth, 21.1% acquisition contribution, and partially offset by a 0.4% foreign exchange headwind.
• Adjusted net sales were $756.7 million, up 28.4% year-over-year.
• GAAP earnings per diluted share from continuing operations were $1.66, up 6% from $1.56 in the prior year period.
• Adjusted earnings per diluted share from continuing operations were a record $2.05, up 23% from $1.67 in the prior year period.
• Operating profit was $140.6 million, an 18.8% increase year-over-year, with an operating margin of 18.6% (down 150 basis points).
• Adjusted operating profit was $169.9 million, a 35.8% increase year-over-year, with a record adjusted operating margin of 22.5% (up 130 basis points).
• Cash generated from operating activities was $128.4 million; capital expenditures were $12.1 million, resulting in free cash flow of $116.3 million.
• Adjusted free cash flow from continuing operations was $126.4 million.
• As of September 30, 2026, the company held $315.7 million in cash and had total debt outstanding of $928.5 million.
• Total company core backlog increased 9% year-over-year, with Aerospace & Advanced Technologies (AAT) up 9% and Process Flow Technologies (PFT) up 8%.

Guidance and Future Outlook:

• Full-year adjusted EPS guidance was raised and narrowed to a range of $7.23–$7.38, from the previous range of $6.85–$7.05.
• Full-year total sales are expected to increase approximately 26% at the midpoint.
• Core sales growth and acquisition contributions are both expected to perform at the high end of previous guidance ranges (5–6% and 18–20%, respectively).
• Adjusted segment operating margin is expected to be approximately 24.0%, up from a prior view of 23.0%+.
• Corporate costs are projected to be approximately $80–$85 million.
• Net non-operating expense is expected to be approximately $58 million.
• The adjusted tax rate is expected to be approximately 23.0%.
• Diluted shares are expected to be approximately 59 million.

Business Segments and Product Lines:

• Aerospace & Advanced Technologies (AAT): Sales were $344.1 million, up 27.4% year-over-year, driven by 9.5% core growth and 17.9% acquisition contribution (Druck). Operating profit margin was 24.8% (down 30 basis points), while adjusted operating profit margin was 26.3% (up 100 basis points).
• Process Flow Technologies (PFT): Sales were $410.5 million, up 28.7% year-over-year, driven by 6.2% core growth and 23.9% acquisition contribution (optek-Danulat, Panametrics, Reuter-Stokes). Operating profit margin was 19.7% (down 250 basis points), while adjusted operating profit margin was 24.0% (up 80 basis points).
• Recent acquisitions (Druck, optek-Danulat, Panametrics, Reuter-Stokes) are performing ahead of expectations, contributing to strong sales and margins.

Market and Competitive Landscape:

• AAT continues to show strong momentum with 9.5% core sales growth.
• PFT delivered particularly strong core order growth of 19.7%.
• Demand is healthy across both segments, reflected in the 9% increase in total core backlog.

Risks and Challenges:

• Operating profit margins declined due to expected dilution from recent acquisitions and integration costs.
• Foreign exchange headwinds and tariff recovery adjustments impacted reported figures.
• Forward-looking statements note risks including global economic conditions, geopolitical risks, supply chain disruptions, inability to successfully integrate acquisitions, and regulatory compliance.

Management Commentary and Tone:

• CEO Alex Alcala described the quarter as "exceptional" with strong performance across both segments.
• Management expressed confidence in the company's positioning for 2027, citing strong momentum, healthy backlog, and acquisitions performing significantly ahead of expectations.
• The tone indicates a strategic focus on transforming the PFT portfolio to concentrate on highly engineered, mission-critical products in durable growth markets such as pharmaceuticals, water, power, cryogenics, and nuclear.

Other Key Points:

• The company declared a fourth quarter 2026 regular dividend of $0.255 per share, payable on December 9, 2026.
• An agreement was announced to divest the UK-based Crane Building Services & Utilities business for £230 million, expected to close early in 2027.
• An agreement was announced to acquire the U.S. water and wastewater pump business from Trillium Flow Technologies, expected to close in the fourth quarter.
• These transactions aim to concentrate the PFT portfolio around highly engineered, mission-critical products.
• Conference call scheduled for October 28, 2026, at 10:00 A.M. Eastern.