SIFCO Industries, Inc. — Third Quarter Fiscal 2026 Earnings Summary

Financial Performance

• Net sales for the third quarter of fiscal 2026 increased 18.3% year-over-year to $26.1 million, compared to $22.1 million in the same period of fiscal 2025.
• Net sales for the first nine months of fiscal 2026 increased 23.5% year-over-year to $76.6 million, compared to $62.0 million in the same period of fiscal 2025.
• Net loss from continuing operations for the third quarter of fiscal 2026 was nominal at $(0.01) per diluted share, compared to a net loss of $0.54 per diluted share in the third quarter of fiscal 2025.
• Net income from continuing operations for the first nine months of fiscal 2026 was $4.4 million, or $0.71 per diluted share, compared to a net loss of $0.4 million, or $(0.07) per diluted share, in the first nine months of fiscal 2025.
• EBITDA for the third quarter of fiscal 2026 was $1.3 million, compared to $5.3 million in the third quarter of fiscal 2025; the prior year quarter included a $2.7 million net benefit from the Employee Retention Credit (ERC).
• Adjusted EBITDA for the third quarter of fiscal 2026 was $4.8 million, compared to $4.4 million in the third quarter of fiscal 2025; the prior year quarter included a $2.2 million net benefit from the ERC.
• EBITDA for the first nine months of fiscal 2026 was $8.6 million, compared to $4.9 million in the first nine months of fiscal 2025.
• Adjusted EBITDA for the first nine months of fiscal 2026 was $13.5 million, compared to $4.0 million in the first nine months of fiscal 2025.
• The third quarter results included a $3.2 million impact to LIFO expense resulting from higher inventory costs and increased purchases.
• Cash and cash equivalents were $77,000 as of June 30, 2026, down from $491,000 as of September 30, 2025.
• Total debt (current maturities of long-term debt and revolver) was $7.0 million as of June 30, 2026, compared to $10.6 million as of September 30, 2025.
• Inventories, net increased to $10.1 million as of June 30, 2026, from $4.2 million as of September 30, 2025.
• Contract liabilities increased to $3.6 million as of June 30, 2026, from $1.8 million as of September 30, 2025.

Business Segments and Product Lines

• SIFCO Industries produces forgings and machined components primarily for the aerospace and energy markets, including processes such as forging, heat-treating, coating, and machining.
• The company noted that customer demand remains strong and the backlog provides continued visibility to future activity.

Risks and Challenges

• Availability of skilled production labor continues to present challenges, though the company reported greater success in recruiting and retaining personnel in the third quarter.
• Forward-looking statements are subject to risks including economic conditions, competition, and other uncertainties detailed in the Company's SEC filings.

Management Commentary and Tone

• CEO George Scherff stated that employees are proud of their contribution to the third quarter results and that their commitment to delivering high-quality products remains a key strength.
• Management emphasized a strategic focus on operational excellence, with production teams focused on process improvements to increase throughput and productivity without compromising quality.
• The company remains focused on converting demand into profitable growth while continuing to improve operational performance.

Other Key Points

• Results from discontinued operations for the third quarter of fiscal 2026 were $0.0 million, compared to net income from discontinued operations of $0.1 million in the third quarter of fiscal 2025.
• There were no results from discontinued operations for the first nine months of fiscal 2026, compared to net income from discontinued operations of $0.1 million in the first nine months of fiscal 2025.
• The company utilizes non-GAAP financial measures (EBITDA and Adjusted EBITDA) to evaluate operating performance and prospective acquisitions, with a reconciliation provided in the release.
• The company had an unsuccessful attempt to be an acquisition target, resulting in transaction-related legal fee credits included in Adjusted EBITDA adjustments for the first nine months of fiscal 2025.
• Weighted-average number of common shares (diluted) was 6,186 for the first nine months of fiscal 2026, compared to 6,050 for the same period in fiscal 2025.