Worthington Enterprises | 8-K: FY2026 Q3 Revenue Beats Estimate at USD 379 M

Revenue: As of FY2026 Q3, the actual value is USD 379 M, beating the estimate of USD 349.41 M.EPS: As of FY2026 Q3, the actual value is USD 0.92, beating the estimate of USD 0.9167.Overall Financial PerformanceWorthington Enterprises, Inc. reported strong financial results for the third quarter of fiscal 2026, with revenue up over 24% year-over-year and adjusted EBITDA growing by 15% year-over-year to $85 million from $74 million in the prior year quarter. Consolidated net sales for the quarter were $379 million, an increase from $305 million in the prior year quarter. Excluding the $32 million impact from recent acquisitions, net sales increased $42 million or 14% organically over the prior year quarter. Gross profit increased to $109 million from $89 million in the prior year quarter, with a gross margin of 28.9% compared to 29.3% a year ago, primarily reflecting the purchase accounting impact of the inventory step-up at LSI. Adjusted EBITDA margin was 22.3%. SG&A expenditures declined by 70 basis points as a percentage of sales. On a trailing 12-month basis, adjusted EBITDA increased $54 million or 22% to $297 million compared to $243 million in the prior year TTM period, with an adjusted EBITDA margin of 22.4%.Net Earnings (GAAP)Worthington Enterprises, Inc. reported net earnings of $45,120 thousand for the third quarter of 2026, $27,029 thousand for the second quarter of 2026, $34,821 thousand for the first quarter of 2026, and $3,614 thousand for the fourth quarter of 2025. For the third quarter of 2025, net earnings were $39,339 thousand, $28,009 thousand for the second quarter of 2025, $24,008 thousand for the first quarter of 2025, and a net loss of -$31,784 thousand for the fourth quarter of 2024.Net Earnings Attributable to Controlling InterestNet earnings attributable to controlling interest were $45,463 thousand in the third quarter of 2026, $27,328 thousand in the second quarter of 2026, $35,148 thousand in the first quarter of 2026, and $3,877 thousand in the fourth quarter of 2025. For the third quarter of 2025, this figure was $39,663 thousand, $28,260 thousand for the second quarter of 2025, $24,253 thousand for the first quarter of 2025, and a net loss of -$31,521 thousand for the fourth quarter of 2024.Interest Expense (Income), NetInterest expense (income), net, was $1,828 thousand in Q3 2026, $1,472 thousand in Q2 2026, $63 thousand in Q1 2026, and -$60 thousand in Q4 2025. For the prior year, it was $628 thousand in Q3 2025, $1,033 thousand in Q2 2025, $489 thousand in Q1 2025, and -$9 thousand in Q4 2024.Income Tax ExpenseIncome tax expense amounted to $14,994 thousand in Q3 2026, $8,751 thousand in Q2 2026, $10,860 thousand in Q1 2026, and $4,717 thousand in Q4 2025. In the previous year, it was $13,240 thousand in Q3 2025, $9,100 thousand in Q2 2025, $6,782 thousand in Q1 2025, and $4,986 thousand in Q4 2024.EBITEBIT was $62,285 thousand in Q3 2026, $37,551 thousand in Q2 2026, $46,071 thousand in Q1 2026, and $8,534 thousand in Q4 2025. For the prior year, EBIT was $53,531 thousand in Q3 2025, $38,393 thousand in Q2 2025, $31,524 thousand in Q1 2025, and -$26,544 thousand in Q4 2024.Adjusted EBITAdjusted EBIT was $66,311 thousand in Q3 2026, $43,388 thousand in Q2 2026, $50,698 thousand in Q1 2026, and $69,106 thousand in Q4 2025. In the previous year, adjusted EBIT was $58,905 thousand in Q3 2025, $41,013 thousand in Q2 2025, $34,159 thousand in Q1 2025, and $47,412 thousand in Q4 2024.Depreciation and AmortizationDepreciation and amortization expenses were $14,552 thousand in Q3 2026, $13,764 thousand in Q2 2026, $13,086 thousand in Q1 2026, and $12,555 thousand in Q4 2025. For the prior year, these expenses were $11,950 thousand in Q3 2025, $11,927 thousand in Q2 2025, $11,830 thousand in Q1 2025, and $12,424 thousand in Q4 2024.Stock-Based CompensationStock-based compensation was $3,752 thousand in Q3 2026, $3,326 thousand in Q2 2026, $3,427 thousand in Q1 2026, and $3,399 thousand in Q4 2025. In the previous year, it was $2,924 thousand in Q3 2025, $3,273 thousand in Q2 2025, $3,925 thousand in Q1 2025, and $3,332 thousand in Q4 2024.Adjusted EBITDA (non-GAAP)Adjusted EBITDA (non-GAAP) was $84,615 thousand in Q3 2026, $60,478 thousand in Q2 2026, $67,211 thousand in Q1 2026, and $85,060 thousand in Q4 2025. For the prior year, adjusted EBITDA was $73,779 thousand in Q3 2025, $56,213 thousand in Q2 2025, $49,914 thousand in Q1 2025, and $63,168 thousand in Q4 2024.Trailing 12-Months (TTM) Adjusted EBITDA (non-GAAP)TTM adjusted EBITDA was $297,364 thousand as of February 28, 2026. For the period ended February 28, 2025, TTM adjusted EBITDA was $243,074 thousand.Trailing 12-Months (TTM) Net Earnings Margin (GAAP)TTM net earnings margin (GAAP) was 8.3% as of February 28, 2026. For the period ended February 28, 2025, TTM net earnings margin (GAAP) was 5.2%.Trailing 12-Months (TTM) Adjusted EBITDA Margin (non-GAAP)TTM adjusted EBITDA margin (non-GAAP) was 22.4% as of February 28, 2026. For the period ended February 28, 2025, TTM adjusted EBITDA margin (non-GAAP) was 21.1%.Net Cash Provided by Operating Activities (GAAP)Net cash provided by operating activities was $61,938 thousand in Q3 2026, $51,518 thousand in Q2 2026, $41,061 thousand in Q1 2026, and $62,414 thousand in Q4 2025. Operating cash flow was $62 million in the quarter.Investment in Property, Plant and EquipmentInvestment in property, plant and equipment was -$13,794 thousand in Q3 2026, -$12,432 thousand in Q2 2026, -$13,195 thousand in Q1 2026, and -$13,086 thousand in Q4 2025. Capital expenditures totaled $14 million in the quarter, including $4 million related to a facility modernization project in consumer products.Free Cash Flow (non-GAAP)Free cash flow was $48,144 thousand in Q3 2026, $39,086 thousand in Q2 2026, $27,866 thousand in Q1 2026, and $49,328 thousand in Q4 2025. Free cash flow was $48 million in the quarter.Trailing 12-Months (TTM) Net Cash Provided by Operating Activities (GAAP)TTM net cash provided by operating activities was $216,931 thousand as of February 28, 2026.Trailing 12-Months (TTM) Free Cash Flow (non-GAAP)TTM free cash flow was $164,424 thousand as of February 28, 2026. On a trailing 12-month basis, free cash flow was $164 million.Trailing 12-Months (TTM) Net Earnings Attributable to Controlling Interest (GAAP)TTM net earnings attributable to controlling interest was $111,816 thousand as of February 28, 2026.Trailing 12-Months (TTM) Adjusted Net Earnings Attributable to Controlling Interest (non-GAAP)TTM adjusted net earnings attributable to controlling interest was $172,981 thousand as of February 28, 2026.Trailing 12-Months (TTM) Operating Cash Flow Conversion (GAAP)TTM operating cash flow conversion (GAAP) was 194% as of February 28, 2026.Free Cash Flow Conversion (non-GAAP)Free cash flow conversion (non-GAAP) was 95% as of February 28, 2026. This represents a 95% free cash flow conversion rate relative to adjusted net earnings.Net Debt and LiquidityAs of February 28, 2026, short-term borrowings were $4,792 thousand and long-term debt was $307,256 thousand. Cash and cash equivalents were $5,979 thousand, resulting in a net debt of $301,277 thousand. Worthington Enterprises, Inc. closed the quarter with net debt of $306 million. The company maintained $495 million of availability under its revolving credit facility at quarter end.Net Debt to TTM Adjusted EBITDA (non-GAAP)The ratio of net debt to TTM adjusted EBITDA (non-GAAP) was 1.0 as of February 28, 2026. This resulted in a net debt-to-trailing adjusted EBITDA ratio of approximately 1.0x.Dividends and Share RepurchasesJoint ventures provided $35 million in dividends during the quarter, representing 113% of equity income. The company returned $9 million to shareholders through dividends and repurchased 100,000 shares of its common stock. A quarterly dividend of $0.19 per share was declared, payable in June 2026.Segment Performance: Building ProductsNet sales grew 36% year-over-year to $224 million, up from $165 million in the prior year quarter. Acquisitions contributed $32 million in net sales, while organic net sales increased 16% year-over-year, driven by strong organic growth across multiple value streams, particularly water and cooling construction businesses. Adjusted EBITDA for the quarter was $59 million compared to $53 million in the prior year quarter, with an adjusted EBITDA margin of 26.3%. This increase included approximately $5 million from recent acquisitions, partially offset by lower combined equity earnings from joint ventures. WAVE contributed $27 million in equity earnings, while ClarkDietrich contributed $6 million compared to $9 million last year.Segment Performance: Consumer ProductsNet sales in Q3 were $155 million, up 11% over the prior year quarter, driven by improved volumes and higher average selling prices. Adjusted EBITDA increased to $35 million from $29 million in Q3 a year ago, with margins expanding to 22.9% from 20.5%. The Celebrations business (Balloon Time) saw volume increases due to market share gains, new placements, and innovation.Outlook / GuidanceWorthington Enterprises, Inc. expects ClarkDietrich’s performance to be relatively flat in Q4 compared to Q3. The facility modernization project is on track and budget, anticipated to be completed by mid-fiscal year 2027, after which capital expenditures should return to more normalized levels. The ASME water tanks business for data centers is expected to triple this year, with additional incremental growth next year and continued growth for several years, as solutions become part of construction projects with a lag between announcements and building completion.