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Graham (781) Q2 2027 Earnings Report

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DE:781 Q2 2027 EPS Results

Actual EPS
EUR 0.35
Consensus EPS
EUR 0.31
Beat/Miss
Beat by +EUR 0.05
One Year Ago EPS
EUR 0.25

DE:781 Q2 2027 Revenue Results

Actual Revenue
EUR 62.87M
Expected Revenue
EUR 64.05M
Beat/Miss
Missed by -EUR 1.18M
YoY Revenue Growth
+5.65%

Earnings Announcement Details

Quarter
Q2 2027
Date
11/05/2026
Time
Before Open
Conference Call
Thursday, November 5, 2026
DE:781 Upcoming Earnings

Graham's next earnings date is estimated for February 8, 2027, based on past reporting schedules.

Q2 2027 Earnings Call Audio

DE:781 Q2 2027 Earnings Call
0:00 / 0:00

Q2 2027 Earnings Slide Deck

Q2 2027 Earnings Call Summary

Q2 2027
Earnings Call Date:Nov 05, 2026|% Change Since:4.73%|
Earnings Call Sentiment|Positive

The call was strongly positive overall. Management reported higher revenue, substantial profitability and margin expansion, record backlog, strong defense and space growth, FlackTek momentum, a solid balance sheet, and reaffirmed full-year guidance while increasing the gross margin outlook. The main challenges were the 17% decline in energy and process revenue, a 3% decline in aftermarket sales, higher SG&A and investment costs, normalization expected in gross margins, and the usual lumpiness and seasonality of orders, cash flow, and quarterly revenue.

Company Guidance

Graham reaffirmed fiscal 2027 revenue guidance of between $285 million and $295 million, representing an increase of 18% over the prior year at the midpoint, and adjusted EBITDA guidance of between $35 million-$40 million, representing a 44% increase at the midpoint; gross margin guidance was increased to 25%-26%, with SG&A and capital expenditure assumptions also updated. The three-year framework remains 8%-10% organic revenue growth per year and adjusted EBITDA margins of 14%-16% by fiscal 2029, implying approximately $340 million-$350 million in revenue and $50 million-$55 million of adjusted EBITDA by FY 2029, with returns above the 20% ROIC hurdle rate for CapEx investments. Approximately 30%-35% of quarter-end backlog is expected to convert to revenue within the next 12 months, another 20%-25% within one to two years, and the remainder beyond two years.

  • Revenue and Profitability GrowthSecond-quarter revenue increased 6% year over year to $69.8 million. Adjusted EBITDA increased 64% to a record $10.3 million, with adjusted EBITDA margin expanding to 14.8% from 9.5% a year ago. Net income increased 50% to $4.6 million, while adjusted net income increased 80% to $6.2 million.
  • Significant Gross Margin ExpansionGross profit increased 38% to $19.7 million, and gross margin expanded 650 basis points to 28.2% from 21.7% a year ago. The improvement reflected operational improvements, FlackTek contributions, a more favorable sales mix, improved execution, pricing discipline, and lower material receipts compared with the unusually high level in the prior-year quarter.
  • Strong First-Half PerformanceFor the first half of fiscal 2027, revenue increased 16% to $141 million, adjusted EBITDA increased 45% to $19.1 million, and adjusted EBITDA margin was 13.5%.
  • Record Backlog and Positive Book-to-BillBacklog reached a record $561 million, up 12% from the prior year and marking the seventh consecutive quarter of record backlog. Second-quarter orders totaled $73.7 million, producing a 1.1x book-to-bill ratio, while year-to-date book-to-bill was 1.2x. Approximately 83% of backlog was in defense.
  • Defense Revenue and Backlog GrowthDefense revenue increased 12% year over year and represented 66% of quarterly sales. Defense orders totaled $41.8 million, and defense backlog increased 10% from a year ago. Growth reflected project milestone timing, new programs, expansion of existing programs, and FlackTek contributions.
  • Defense Program VisibilityThe company said its primary naval positions include the Columbia- and Virginia-class submarine programs and the Mark 48 Mod 7 heavyweight torpedo, which it described as bipartisan-supported programs. Defense backlog was 85% funded, and many supported programs have requirements extending beyond an individual budget or political cycle.
  • Space Revenue and Backlog SurgeSpace revenue increased 59% year over year, reflecting commercialization, higher launch cadences, the ramp of existing programs, and FlackTek contributions. Space orders were $10.6 million, representing a 1.7x quarterly book-to-bill ratio. First-half space orders totaled $25 million, or 2x sales, and space backlog increased 108% from a year ago.
  • Space Demand and Launch Market OpportunitiesManagement said it views launch vehicle access more as a continued tailwind than a headwind. The company is seeing opportunities with large rocket customers and customers expected to replace or backfill the smaller launch fleet, with this activity reflected in its orders and pipeline.
  • FlackTek Momentum and IntegrationFlackTek revenue increased to $9.5 million from $6.6 million in the first quarter. The business contributed margins that were accretive to the portfolio, and its first-half book-to-bill was 1.3x. Management said the integration had gone exceptionally well, with stronger demand for larger machines and higher-value purchase orders.
  • FlackTek Shift Toward ProductionManagement said customers are moving from evaluating FlackTek's technology to using it in production. The time from request for quotation to order is shortening, and the company remains particularly excited about the MEGA platform and the opportunity to commercialize FlackTek's advanced materials-processing technologies.
  • Cryogenic Testing Facility MilestoneThe company completed its first customer test at the new cryogenic test facility in Florida. Together with liquid-nitrogen testing capabilities in Colorado, the facilities allow Graham to validate performance under demanding conditions and deliver fully tested solutions.
  • Operational and Capacity InvestmentsInvestments in capacity, automation, testing, systems, automated welding, assembly, and ERP initiatives are increasingly supporting the business. The company broke ground on a new 30,000-square-foot facility at its Arvada campus to support increasing demand and future turbomachinery growth.
  • Batavia Facility ProgressThe Batavia facility's machining centers were full during the day shift, automated welders were coming online, welding procedures were being approved, and the radiographic testing facility was online and being used. Management said the facility was approaching a critical utilization milestone and could add a second shift if needed.
  • Power-Dense Technology ApplicationsManagement cited opportunities for power-dense rotating machines in microreactors, radar platforms, launch vehicles, satellite systems, and astronaut backpacks. In microreactors, the company said opportunities had entered its design and production environments; in defense, radar opportunities were scaling toward low-rate and rate production.
  • Aftermarket Booking StrengthCombined aftermarket sales across energy and process and defense were $8.6 million, while aftermarket orders increased 91% to $18.3 million. Management highlighted Graham's more than $1 billion installed base as a source of ongoing maintenance, replacement-parts, and performance-improvement opportunities.
  • Strong Balance Sheet and Cash GenerationNet cash provided by operating activities was $34.1 million in the first six months of fiscal 2027. The company ended the quarter with $71 million of cash, no outstanding debt, and $75 million available under its revolving credit facility.
  • Reaffirmed Fiscal 2027 GuidanceThe company reaffirmed fiscal 2027 revenue guidance of $285 million to $295 million and adjusted EBITDA guidance of $35 million to $40 million. At the midpoint, these ranges represent an 18% revenue increase and a 44% adjusted EBITDA increase over the prior year. The company also increased its gross margin outlook by approximately 50 basis points at both the bottom and top ends.
  • Long-Term Financial FrameworkManagement maintained its fiscal 2029 framework of 8%-10% organic revenue growth per year and adjusted EBITDA margins of 14%-16%. The framework implies approximately $340 million-$350 million of revenue and $50 million-$55 million of adjusted EBITDA by fiscal 2029.
  • M&A Pipeline and Capital AllocationManagement said the M&A pipeline remains full, conversations are active, and the company is focused on strategic opportunities that meet its stated criteria. With no debt, management identified continued organic investment as the first priority and M&A as the next priority, while maintaining a 20% ROIC hurdle rate for capital investments.
  • International Allied-Navy OpportunitiesManagement said Graham already supplies products for foreign-allied Navy applications through integrators, primes, and upstream customers. It cited increased content through shipbuilding programs and global submarine spare-parts opportunities as areas for continued growth.

DE:781 Earnings History

DE:781 earnings history
Report DateFiscal QuarterForecast / EPSLast Year's EPSEPS YoY ChangePress Release
Feb 08, 20272027 (Q3)0.27-0.23――
Nov 05, 20262027 (Q2)0.310.350.2539.29% (+0.10)
Aug 06, 20262027 (Q1)0.240.300.38-21.43% (-0.08)
Jun 08, 20262026 (Q4)0.260.160.36-55.00% (-0.20)
Feb 06, 20262026 (Q3)0.190.230.1378.57% (+0.10)
Nov 07, 20252026 (Q2)0.250.250.27-6.67% (-0.02)
Aug 05, 20252026 (Q1)0.210.380.2455.56% (+0.14)
Jun 09, 20252025 (Q4)0.160.360.11233.33% (+0.25)
Feb 07, 20252025 (Q3)0.090.130.02600.00% (+0.11)
Nov 08, 20242025 (Q2)0.110.270.04650.00% (+0.23)

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

Beat Missed