Zurn Elkay Water Solutions Corp. reported its fourth‑quarter and full‑year 2025 results on February 3, 2026, delivering record annual sales of $1.696 billion, an 8% year‑over‑year increase, and adjusted EBITDA of $442 million, up 13.3% from $390 million in 2024.
Full‑year net sales rose to $1.696 billion from $1.567 billion, driven by a 10% increase in core sales across all product categories. Adjusted EBITDA expanded to $442 million, a margin of 26.1% versus 24.9% in 2024, reflecting the impact of the Zurn Elkay Business System’s productivity initiatives and a shift away from China‑sourced components that reduced supply‑chain costs.
In the quarter ended December 31, 2025, net sales were $407.2 million, up 10% from $370.7 million in Q4 2024. Core sales grew 10%, and adjusted EBITDA reached $104.1 million, or 25.6% of net sales, an increase of 100 basis points over the prior year. The margin expansion was driven by higher pricing power in the core segment and improved operational leverage from the Business System rollout.
Adjusted earnings per share were $0.36, beating the consensus estimate of $0.34 by $0.02. The beat was largely due to disciplined cost management and a favorable mix shift toward higher‑margin core products, which offset modest increases in raw‑material costs and allowed the company to maintain profitability despite a competitive pricing environment.
The company raised its quarterly dividend by 22% year‑over‑year, reflecting confidence in cash‑flow generation, and completed $160 million of share repurchases during 2025, a significant portion of the $1.7 billion of shares repurchased in the prior year. No $500 million share‑repurchase authority was disclosed.
Management reiterated its 2026 outlook, projecting mid‑single‑digit core sales growth and incremental adjusted EBITDA margins of approximately 35%, with free cash flow expected to reach $335 million. The guidance signals continued confidence in demand across all end markets and the ability to sustain margin expansion through the Business System and supply‑chain optimization.
Todd A. Adams, Chairman and CEO, said the results “demonstrate the effectiveness of the Zurn Elkay Business System in driving both revenue growth and margin expansion.” He added that the company’s “record free cash flow and low net‑debt leverage of 0.4× position us to continue delivering shareholder value through dividends and share repurchases.”
Market reaction to the earnings was measured but positive. Analysts noted the EPS beat and margin expansion as key drivers of investor confidence, while the modest share‑repurchase activity and dividend increase reinforced the company’s commitment to returning capital to shareholders. The results also reinforced the narrative that Zurn Elkay’s strategic shift away from China components and its focus on core product demand are paying off, supporting a favorable long‑term outlook.
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