Gorman-Rupp Company (GRC) Q2 2026 earnings summary

Executive summary

• Net sales for the first six months of 2026 increased 5.7% year-over-year to $362.7 million, with Q2 net sales reaching a record $186.1 million, up 3.9% year-over-year.

• Net income rose 33.5% to $37.3 million for the first half, with Q2 net income at $19.4 million ($0.74/share), and EPS up to $1.41 from $1.06.

• Broad-based sales growth was led by construction, agriculture, and data center-related demand.

• Operating income for the first half rose 18.0% to $57.9 million, with operating margin improving to 16.0% from 14.3%.

• The Board declared a $0.19 per share quarterly dividend, marking the 306th consecutive quarterly dividend.

Financial highlights

• Gross margin improved to 32.5% for the first half (up 150 bps), and 32.6% in Q2 (up 130 bps), driven by price increases, favorable mix, and lower LIFO costs.

• Adjusted EBITDA for the first six months was $73.7 million (20.3% of sales), up from $65.0 million (18.9%).

• Interest expense decreased 21.0% to $9.6 million for the first half due to lower outstanding debt.

• Cash from operations was $62.5 million, up from $48.9 million, with end-of-period cash at $43.6 million.

• Operating margin was 16.3% in Q2 and 16.0% for the first half.

Outlook and guidance

• Management expects continued strong performance in the second half, supported by healthy order backlog and broad-based demand, especially in construction, agriculture, and data center-related markets.

• Incoming orders for the first half were $370.8 million, up 1.4% year-over-year; backlog at June 30, 2026 was $239.7 million, up from $224.4 million a year ago.

• Capital expenditures for 2026 are planned at $22–24 million, focused on machinery and equipment.