EVI Industries — Fiscal 2026 Earnings Summary

Financial Performance

• Fiscal 2026 revenue increased 15% to a record $446.6 million; fourth quarter revenue increased 11% to a record $121.9 million.
• Fiscal 2026 gross profit increased 19% to a record $140.7 million (31.5% margin); fourth quarter gross profit increased 13% to a record $38.5 million (31.6% margin, an 80-basis point improvement).
• Fiscal 2026 operating income increased 14% to a record $15.7 million; fourth quarter operating income increased 37% to a record $5.6 million.
• Fiscal 2026 net income increased 3% to $7.7 million; fourth quarter net income increased 31% to $2.7 million.
• Fiscal 2026 adjusted EBITDA increased 16% to a record $29.1 million (6.5% margin); fourth quarter adjusted EBITDA increased 26% to a record $9.1 million (7.5% margin, a 100-basis point improvement).
• Fiscal 2026 operating cash flow was $20.6 million; fourth quarter operating cash flow was $13.4 million.
• Net debt was $44.2 million at June 30, 2026, substantially unchanged from the prior year, having declined $11.5 million during the fourth quarter.
• Fiscal 2026 SG&A expenses were $125.0 million; fourth quarter SG&A expenses were $32.8 million.
• Fiscal 2026 interest expense, net, was $3.9 million; fourth quarter interest expense, net, was $1.0 million.

Guidance and Future Outlook

• Management targets achieving double-digit consolidated operating margins over time by leveraging corporate expenses across a larger revenue base and continuing operational improvements.
• The company expects to invest in organic growth, technology, acquisitions, and the development of both commercial laundry and consumer garment care businesses.
• Management anticipates that as sales grow and technology utilization deepens, a greater portion of incremental gross profit will flow through to earnings.
• The company plans to return capital to shareholders through dividends from time to time, though acquisitions of greater size may require additional capital.

Business Segments and Product Lines

• Fiscal 2026 included the acquisition of ASN Laundry Group (August 2025) and Belenky, Inc. (February 2026), bringing the total commercial laundry businesses to 32.
• On September 1, 2026, the company closed the acquisition of Sudsies, Inc., establishing a new Consumer Garment Care Services division.
• The commercial laundry business saw approximately 30,300 service visits in the fourth quarter, up approximately 10% sequentially, including visits to approximately 11,600 unique customers.
• Revenue growth is supported by a shift toward higher-margin service, parts, and consumables, as well as ownership of a greater portion of the supply chain through the Continental subsidiary.
• The company is deploying core ERP, field service, and supporting technology platforms to standardize processes and improve productivity.

Market and Competitive Landscape

• The commercial laundry industry is characterized by durable and predictable demand, with customers increasingly investing in larger, higher-capacity systems that require more complex installation and specialized service.
• The consumer garment care market is described as a multibillion-dollar, essential, and highly fragmented industry with recurring demand.
• EVI positions itself as the acquirer of choice in the commercial laundry industry due to its reputation for honoring legacies and providing growth opportunities for acquired business employees.
• The company monitors tariff developments and has adjusted pricing while collaborating with suppliers on cost mitigation strategies.

Risks and Challenges

• Quarterly results can be impacted by the timing of deliveries and installations, which depend on customer facility readiness, construction schedules, and external factors like adverse weather.
• Trade policy uncertainty and potential tariff impacts on supplier and OEM costs remain a risk, though the company believes its essential product mix and broad customer base allow for management of these conditions.
• Risks associated with the "buy-and-build" strategy include the ability to identify and consummate acquisitions, integration risks, and the potential for acquired businesses to underperform or lose supplier relationships.
• Risks related to the new consumer garment care division include the success of the expansion strategy, operational risks, and the ability to realize anticipated financial benefits from the Sudsies acquisition.
• Forward-looking statements note risks regarding general economic conditions, inflation, interest rate increases, supply chain disruptions, and cybersecurity threats.

Management Commentary and Tone

• CEO Henry M. Nahmad described fiscal 2026 as the company's "best year" and noted meaningful progress toward achievable operating leverage.
• Management expressed confidence that the company's model is consistent across both commercial laundry and consumer garment care divisions, focusing on partnering with operators to provide resources and capabilities for growth.
• The tone regarding the new division is optimistic, viewing consumer garment care as an opportunity to extend capabilities into a complementary area with significant long-term potential.
• Management emphasized that corporate expense investments in technology and infrastructure are building long-term earnings capacity rather than creating permanent margin constraints.

Other Key Points

• The company paid $4.983 million in dividends during fiscal 2026.
• Fiscal 2026 included $7.182 million in cash paid for acquisitions, net of cash acquired.
• Capital expenditures were $7.152 million for fiscal 2026.
• The company repurchased common stock in satisfaction of employee tax withholding obligations totaling $1.544 million during fiscal 2026.
• Issuances of common stock under the employee stock purchase plan totaled $177,000 for fiscal 2026.
• The company has a conservatively capitalized balance sheet with $6.774 million in cash at June 30, 2026.
• Adjusted EBITDA excludes the amortization of stock-based compensation, which totaled $5.298 million for fiscal 2026.