SXI News & Events

The company said, "In fiscal Q4, on a year-on-year basis, the Company expects slightly to moderately higher revenue, driven by mid-to-high single digit organic growth from higher sales into fast growth end markets and increased new product sales, partially offset by the impact on revenue from the recently completed divestiture of Federal Industries. The Company expects slightly lower adjusted operating margin as contributions from organic growth and realization of productivity actions are more than offset by growth investments, higher medical costs, and increased variable compensation expenses. On a sequential basis, the Company expects slightly higher revenue, driven by increased contributions from fast growth end markets and new product sales, and slightly to moderately higher adjusted operating margin due to higher volume and pricing and productivity initiatives, partially offset by growth investments."

Reports Q3 revenue $224.6M, consensus $225.16M. Commenting on the quarter's results, President and CEO, David Dunbar said, "We delivered another quarter with year-on-year organic growth and strong operating performance. Our sales increased 8.1% year-on-year to $224.6M driven by 8% contribution from new products and more than 30% contribution from sales into fast growth markets. We realized 6.5% organic growth with a book to bill of 1.05. Our Electronics segment grew 6.8% organically with a book to bill of 1.14. We are well positioned to deliver mid-to-high single-digit organic growth again in the fiscal Q4, primarily driven by new product launches, and strong tailwinds in the electrical grid, space, defense and aviation end markets. Sales from fast growth markets totaled approximately $69M in the fiscal Q3 and are expected to reach approximately $270M for the FY26. Adjusted operating margin expanded by 30 basis points year-on-year to 19.7%. We paid down approximately $62M of debt in the fiscal Q3, and our net leverage ratio was reduced to 1.9x.

The Company's prior FY26 sales outlook included a full year contribution from Federal Industries. Considering the divestiture of Federal Industries and barring any unforeseen economic, global trade, or tariffs related disruptions, the Company now expects revenue to grow by approximately $100M in FY26, which will continue to be driven by mid-to-high single digit organic growth in Electronics and double-digit organic growth in Aerospace & Defense. The Company remains on course to release over fifteen new products that it expects will contribute approximately 300 bps of incremental growth. Sales from fast growth markets are on track to grow approximately 45% year-on-year and reach approximately $270M.