Enerpac Tool Group (EPAC) Q1 2026 earnings summary

Executive summary

• Q1 FY26 net sales were $144 million, down 1% year-over-year, with organic sales declining 2% and product sales up 4%–7%, while service revenue dropped 25%–26%, mainly due to UK and EMEA market softness.

• Adjusted EBITDA was $32.4 million (22.4% margin), down year-over-year, and net earnings were $19–$19.1 million, or $0.36 per diluted share, compared to $0.40 last year.

• Strong order growth and backlog, especially in Industrial Tools & Services (IT&S) and Cortland Biomedical, which grew 27%.

• Investments continue in innovation, commercial capabilities, and geographic expansion to support growth strategy.

• Approximately $15 million was returned to shareholders via share repurchases in Q1.

Financial highlights

• Gross margin was 50.7%, stable to slightly down year-over-year; adjusted EBITDA margin was 22.4%.

• Adjusted EPS was $0.36, down from $0.40 last year, impacted by a higher tax rate.

• Free cash flow was $13–$16 million, up year-over-year.

• Net debt at quarter end was $49–$49.4 million; net debt-to-adjusted EBITDA ratio of 0.3x.

• Total liquidity was $539 million, including $139 million cash and $400 million undrawn revolver.

Outlook and guidance

• FY26 guidance maintained: net sales of $635–$655 million, organic revenue growth of 1%–4%, adjusted EBITDA of $158–$168 million, adjusted EPS of $1.85–$2.00, and free cash flow of $100–$110 million.

• Margin pressure from tariffs expected to ease in the second half; margin improvement anticipated.

• APAC region expected to return to growth in Q2 and for the full year.

• Guidance assumes stable FX rates and no major regulatory or tariff changes.