St. Louis, Aug. 06, 2026 (GLOBE NEWSWIRE) -- ESCO Technologies Inc. (NYSE: ESE) (ESCO, or the Company) today reported its operating results for the third quarter ended June 30, 2026 (Q3 2026).
Operating Highlights
- Q3 2026 Sales increased $43 million (14 percent) to $339 million compared to $296 million in Q3 2025. Q3 2026 organic sales increased $20 million (8 percent), and Maritime contributed $23 million of revenue growth in the quarter.
- Q3 2026 GAAP EPS from Continuing Operations increased 31 percent to $1.26 per share compared to $0.96 per share in Q3 2025. Q3 2026 Adjusted EPS from Continuing Operations increased 38 percent to $2.20 per share compared to $1.60 per share in Q3 2025.
- Q3 2026 entered orders were $410 million, with a book-to-bill ratio of 1.21. This resulted in record backlog at June 30 of $1.54 billion. Q3 2026 orders were lower than the prior year due to $364 million of acquired backlog related to the acquisition of Maritime in Q3 2025.
- Net cash provided by operating activities from Continuing Operations was $193 million YTD, an increase of $105 million compared to the prior year period.
Bryan Sayler, Chief Executive Officer and President, commented, “Q3 was another strong quarter, highlighted by 14 percent revenue growth, 90 basis points of Adjusted EBIT margin expansion, and a 38 percent increase in Adjusted EPS.
“Year to date, we have delivered double-digit organic sales growth across our aerospace, Navy, Test, and Doble businesses. This broad-based strength underscores the long-term growth dynamics across our end markets. At the same time, our backlog has increased by over $400 million year-to-date driven by momentum across our business platforms. This combination of durable growth drivers, leading market positions, and record backlog, gives us confidence in our ability to continue delivering above-market growth and we are pleased to again raise our full-year FY 2026 guidance.”
Segment Performance
Aerospace & Defense (A&D)
- Q3 2026 sales increased $31.9 million (23 percent) to $168.2 million from $136.3 million in Q3 2025. Organic sales increased $9.2 million (9 percent) and Maritime added $22.7 million of revenue growth in the quarter. Quarterly sales growth was led by strong performance in commercial aerospace and Navy.
- Q3 2026 EBIT increased $13.8 million to $50.4 million from $36.6 million in Q3 2025. Adjusted EBIT increased $11.2 million in Q3 2026 to $50.5 million (30.0 percent margin) from $39.3 million (28.8 percent margin) in Q3 2025. The 28 percent increase in Adjusted EBIT was driven by leverage on higher volume and price increases, partially offset by inflationary pressures and unfavorable mix.
- Q3 2026 Entered Orders decreased $386.7 million (66 percent) to $195.7 million, as Q3 2025 contained $364.2 million in acquired backlog related to the Maritime acquisition along with $67 million in Block V.2/VI Virginia Class and $15 million of Columbia Class orders. Book-to-bill in the quarter was 1.16 driven by higher commercial and military aerospace OEM and aftermarket orders, resulting in record backlog of $1.1 billion.
Utility Solutions Group (USG)
- Q3 2026 sales increased $7.6 million (8 percent) to $100.0 million from $92.4 million in Q3 2025. Doble sales increased by $12.9 million (17 percent) while NRG sales decreased by $5.3 million (29 percent). Sales growth in the quarter was driven by higher protection testing, offline test equipment, and services revenue at Doble, partially offset by lower renewables revenue at NRG.
- Q3 2026 EBIT increased $0.5 million to $22.0 million from $21.5 million in Q3 2025. Adjusted EBIT increased $0.5 million in Q3 2026 to $22.3 million (22.3 percent margin) from $21.8 million (23.6 percent margin) in Q3 2025. The increase in Adjusted EBIT was driven by leverage on higher volume at Doble and price increases, mostly offset by EBIT reductions at NRG due to lower sales volumes.
- Q3 2026 entered orders increased $21.4 million (20 percent) to $126.9 million (book-to-bill of 1.27), resulting in backlog of $189.4 million. Doble orders increased $26.4 million (30 percent) to $113.3 million as the business continues to experience broad based increases in demand from utility customers. NRG orders decreased $5.0 million (27 percent) to $13.5 million, related to the expiration of U.S. renewables tax credits.
RF Test & Measurement (Test)
- Q3 2026 sales increased $3.2 million (5 percent) to $70.9 million from $67.7 million in Q3 2025. Sales growth in the quarter was primarily driven by higher U.S Test & Measurement (EMC), and medical and industrial shielding.
- Q3 2026 EBIT increased $0.2 million to $10.9 million from $10.7 million in Q3 2025. Q3 2026 Adjusted EBIT increased $0.9 million to $11.6 million (16.4 percent margin) from $10.7 million (15.9 percent margin) in Q3 2025. The 8 percent increase in Adjusted EBIT was driven by leverage on higher volume and price increases, partially offset by inflationary pressures.
- Q3 2026 entered orders increased $25.8 million (42 percent) to $87.0 million (book-to-bill of 1.23), resulting in record backlog of $248.6 million. Orders strength in the quarter was driven by industrial shielding projects and electromagnetic interference (EMI) filters for U.S. data centers.
Megger Acquisition
As announced on April 15, 2026, ESCO has agreed to acquire Megger Group Limited. Megger will become part of ESCO’s Utility Solutions Group, creating a business of substantial scale and expanding our capabilities as a valued partner to utilities worldwide. All filings for regulatory approval are underway and we continue to anticipate closing on the transaction in Q1 of fiscal 2027.
Business Outlook – FY 2026
FY 2026 Sales and Adjusted EPS Guidance Update:
- Raising the lower end of FY 2026 Sales guidance and now expect Sales to be in the range of $1.30 to $1.33 billion (19 to 21 percent growth over the prior year).
- Raising full year Adjusted EPS guidance to a range of $8.30 - $8.40 per share (38 to 39 percent growth), which reflects a midpoint increase of $0.70 per share from our initial November guidance ($7.50 - $7.80) and $0.22 per share from our more recent May guidance update of ($8.00 - $8.25).
- Q4’26 Adjusted EPS is expected to be in the range of $2.55 - $2.65 per share (10 to 14 percent growth compared to Q4’25 Adjusted EPS).
Dividend Payment
The next quarterly cash dividend of $0.08 per share will be paid on October 15, 2026 to stockholders of record on October 1, 2026.
Conference Call
The Company will host a conference call today, August 6, at 4:00 p.m. Central Time, to discuss the Company’s Q3 2026 results. A live audio webcast and an accompanying slide presentation will be available in the Investor Center of ESCO’s website. Participants may also access the webcast using this registration link. For those unable to participate, a webcast replay will be available after the call in the Investor Center of ESCO’s website.
Forward-Looking Statements
Statements in this press release regarding Management’s intentions, expectations and guidance for fiscal 2026, including restructuring and cost reduction actions, sales, orders, revenues, margin, earnings, Adjusted EPS, acquisition related amortization, and any other statements which are not strictly historical, are “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. securities laws.
Investors are cautioned that such statements are only predictions and speak only as of the date of this release, and the Company undertakes no duty to update them except as may be required by applicable laws or regulations. The Company’s actual results in the future may differ materially from those projected in the forward-looking statements due to risks and uncertainties that exist in the Company’s operations and business environment including but not limited to those described in Item 1A, “Risk Factors”, of the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2025 and the following: the impacts of climate change and related regulation of greenhouse gases; the impacts of labor disputes, civil disorder, wars including the conflicts involving Iran and Lebanon, elections, political changes, tariffs and trade disputes, terrorist activities, cyberattacks or natural disasters on the Company’s operations and those of the Company’s customers and suppliers; disruptions in manufacturing or delivery arrangements due to shortages or unavailability of materials or components; restrictions or closures of critical supply routes such as the Strait of Hormuz; other supply chain disruptions; inability to access work sites; the timing and content of future contract awards or customer orders; the timely appropriation, allocation and availability of Government funds; the termination for convenience of Government and other customer contracts or orders; weakening of economic conditions in served markets; the success of the Company’s competitors; changes in customer demands or customer insolvencies; competition; intellectual property rights; technical difficulties or data breaches; the availability of acquisitions; delivery delays or defaults by customers; performance issues with key customers, suppliers and subcontractors; material changes in the costs and availability of certain raw materials; material changes in the cost of credit; changes in laws and regulations including but not limited to changes in accounting standards and taxation; changes in interest, inflation and employment rates; costs relating to environmental matters arising from current or former facilities; uncertainty regarding the ultimate resolution of current disputes, claims, litigation or arbitration; and the integration and performance of acquired businesses.
Non-GAAP Financial Measures
The financial measures EBIT, Adjusted EBIT, EBITDA, Adjusted EBITDA, and Adjusted EPS are presented in this press release. The Company defines “EBIT” as earnings before interest and taxes, “EBITDA” as earnings before interest, taxes, depreciation and amortization, “Adjusted EBIT” and “Adjusted EBITDA” as excluding the net impact of the items described in the attached Reconciliation of Non-GAAP Financial Measures, and “Adjusted EPS” as GAAP earnings per share excluding the net impact of the items described and reconciled in the attached Reconciliation of Non-GAAP Financial Measures.
EBIT, Adjusted EBIT, EBITDA, Adjusted EBITDA, and Adjusted EPS are not recognized in accordance with U.S. generally accepted accounting principles (GAAP). However, Management believes EBIT, Adjusted EBIT, EBITDA, and Adjusted EBITDA are useful in assessing the operational profitability of the Company’s business segments because they exclude interest, taxes, depreciation, and amortization, which are generally accounted for across the entire Company on a consolidated basis. EBIT is also one of the measures used by Management in determining resource allocations within the Company as well as incentive compensation. The presentation of EBIT, Adjusted EBIT, EBITDA, Adjusted EBITDA, and Adjusted EPS provides important supplemental information to investors by facilitating comparisons with other companies, many of which use similar non-GAAP financial measures to supplement their GAAP results. The use of non-GAAP financial measures is not intended to replace any measures of performance determined in accordance with GAAP.
About ESCO
ESCO Technologies is a global provider of highly engineered products and solutions serving diverse end-markets. It manufactures filtration and fluid control products, advanced composites, as well as signature and power management solutions for aviation, Navy, and industrial customers. ESCO is an industry leader in designing and manufacturing RF test and measurement products and systems; and provides diagnostic instruments, software and services to industrial power users and the electric utility and renewable energy industries. Headquartered in St. Louis, Missouri, ESCO and its subsidiaries have offices and manufacturing facilities worldwide. For more information on ESCO and its subsidiaries, visit ESCO’s website at www.escotechnologies.com.
| ESCO TECHNOLOGIES INC. AND SUBSIDIARIES | |||||||||||
| Condensed Consolidated Statements of Operations (Unaudited) | |||||||||||
| (Dollars in thousands, except per share amounts) | |||||||||||
| Three Months Ended June 30, 2026 | Three Months Ended June 30, 2025 | ||||||||||
| Net Sales | $ | 339,027 | 296,344 | ||||||||
| Cost and Expenses: | |||||||||||
| Cost of sales | 197,508 | 174,350 | |||||||||
| Selling, general and administrative expenses | 71,002 | 62,042 | |||||||||
| Amortization of intangible assets | 20,342 | 16,753 | |||||||||
| Interest expense | 8,713 | 7,921 | |||||||||
| Other expenses (income), net | 508 | 2,209 | |||||||||
| Total costs and expenses | 298,073 | 263,275 | |||||||||
| Earnings before income taxes | 40,954 | 33,069 | |||||||||
| Income tax expense | 8,219 | 8,314 | |||||||||
| Earnings from continuing operations | 32,735 | 24,755 | |||||||||
| Earnings from discontinued operations, net of tax expense | |||||||||||
| of $0 and $599, respectively | - | 1,310 | |||||||||
| Net earnings | $ | 32,735 | 26,065 | ||||||||
| Diluted - GAAP | |||||||||||
| Continuing operations | $ | 1.26 | 0.96 | ||||||||
| Discontinued operations | 0.00 | 0.05 | |||||||||
| Net earnings | $ | 1.26 | 1.01 | ||||||||
| Diluted - As Adjusted Basis | |||||||||||
| Continuing Operations | $ | 2.20 | (1 | ) | 1.60 | (2 | ) | ||||
| Diluted average common shares O/S: | 25,980 | 25,918 | |||||||||
| (1 | ) | Q3 2026 Adjusted EPS from continuing operations excludes $0.94 per share of after-tax charges consisting of: $0.03 of Test & USG segment restructuring charges, $0.20 of debt financing and $0.19 of acquisition costs at Corporate related to the pending Megger acquisition that was announced in April 2026, and $0.52 of acquisition related amortization. | |||||||||
| (2 | ) | Q3 2025 Adjusted EPS from continuing operations excludes $0.64 per share of after-tax charges consisting of: $0.15 of Corporate acquisition costs, $0.08 of Maritime inventory step-up charges and stamp duties, $0.01 of restructuring charges (primarily severance) within the USG segment, and $0.40 of acquisition related amortization. | |||||||||
| ESCO TECHNOLOGIES INC. AND SUBSIDIARIES | |||||||||||
| Condensed Consolidated Statements of Operations (Unaudited) | |||||||||||
| (Dollars in thousands, except per share amounts) | |||||||||||
| Nine Months Ended June 30, 2026 | Nine Months Ended June 30, 2025 | ||||||||||
| Net Sales | $ | 938,027 | 742,714 | ||||||||
| Cost and Expenses: | |||||||||||
| Cost of sales | 545,274 | 431,068 | |||||||||
| Selling, general and administrative expenses | 195,039 | 171,305 | |||||||||
| Amortization of intangible assets | 61,086 | 32,735 | |||||||||
| Interest expense | 13,992 | 12,373 | |||||||||
| Other expenses (income), net | 2,340 | 1,947 | |||||||||
| Total costs and expenses | 817,731 | 649,428 | |||||||||
| Earnings before income taxes | 120,296 | 93,286 | |||||||||
| Income tax expense | 25,314 | 21,841 | |||||||||
| Earnings from continuing operations | 94,982 | 71,445 | |||||||||
| Earnings from discontinued operations, net of tax expense | |||||||||||
| of $363 and $3,006, respectively | 1,177 | 9,126 | |||||||||
| Net earnings | $ | 96,159 | 80,571 | ||||||||
| Diluted - GAAP | |||||||||||
| Continuing operations | $ | 3.66 | 2.76 | ||||||||
| Discontinued operations | 0.05 | 0.35 | |||||||||
| Net earnings | $ | 3.71 | 3.11 | ||||||||
| Diluted - As Adjusted Basis | |||||||||||
| Continuing Operations | $ | 5.75 | (1 | ) | 3.71 | (2 | ) | ||||
| Diluted average common shares O/S: | 25,932 | 25,876 | |||||||||
| (1 | ) | YTD Q3 2026 Adjusted EPS from continuing operations excludes $2.09 per share of after-tax charges consisting primarily of: $0.09 of restructuring charges within Test, USG & A&D segments, $0.20 of debt financing and $0.23 of acquisition costs at Corporate related to the pending Megger acquisition that was announced in April 2026, and $1.57 of acquisition related amortization. | |||||||||
| (2 | ) | YTD Q3 2025 Adjusted EPS from continuing operations excludes $0.95 per share of after-tax charges consisting of: $0.15 of Corporate acquisition costs, $0.08 of Maritime inventory step-up charges and stamp duties, $0.02 of restructuring charges within the Test and USG segments, and $0.70 of acquisition related amortization. | |||||||||
| ESCO TECHNOLOGIES INC. AND SUBSIDIARIES | |||||||||||||||
| Condensed Business Segment Information (Unaudited) - Continuing Operations basis | |||||||||||||||
| (Dollars in thousands) | |||||||||||||||
| GAAP | As Adjusted | ||||||||||||||
| Q3 2026 | Q3 2025 | Q3 2026 | Q3 2025 | ||||||||||||
| Net Sales | |||||||||||||||
| Aerospace & Defense | $ | 168,202 | 136,324 | 168,202 | 136,324 | ||||||||||
| USG | 99,963 | 92,357 | 99,963 | 92,357 | |||||||||||
| Test | 70,862 | 67,663 | 70,862 | 67,663 | |||||||||||
| Totals | $ | 339,027 | 296,344 | 339,027 | 296,344 | ||||||||||
| EBIT | |||||||||||||||
| Aerospace & Defense | $ | 50,418 | 36,577 | 50,455 | 39,319 | ||||||||||
| USG | 21,983 | 21,540 | 22,282 | 21,789 | |||||||||||
| Test | 10,882 | 10,732 | 11,617 | 10,732 | |||||||||||
| Corporate | (33,616 | ) | (27,859 | ) | (9,678 | ) | (9,184 | ) | |||||||
| Consolidated EBIT | 49,667 | 40,990 | 74,676 | 62,656 | |||||||||||
| Less: Interest expense | (8,713 | ) | (7,921 | ) | (1,850 | ) | (7,921 | ) | |||||||
| Less: Income tax expense | (8,219 | ) | (8,314 | ) | (15,548 | ) | (13,297 | ) | |||||||
| Net earnings | $ | 32,735 | 24,755 | 57,278 | 41,438 | ||||||||||
| Note 1: Adjusted net earnings of $57.3 million in Q3 2026 exclude $24.5 million (or $0.94 per share) of after-tax charges consisting of: $0.03 of Test & USG segment restructuring charges, $0.20 of debt financing and $0.19 of acquisition costs at Corporate related to the pending Megger acquisition and $0.52 of acquisition related amortization. | |||||||||||||||
| Note 2: Adjusted net earnings of $41.4 million in Q3 2025 exclude $16.6 million (or $0.64 per share) of after-tax charges consisting of: $0.15 of Corporate acquisition costs, $0.08 of Maritime inventory step-up charges and stamp duties, $0.01 of restructuring charges (primarily severance) within the USG segment, and $0.40 of acquisition related amortization. | |||||||||||||||
| EBITDA Reconciliation to Net earnings: | Q3 2026 - | Q3 2025 - | |||||||||||||
| Q3 2026 | Q3 2025 | As Adj | As Adj | ||||||||||||
| Consolidated EBITDA | $ | 76,410 | 63,350 | 83,755 | 71,545 | ||||||||||
| Less: Depr & Amort | (26,743 | ) | (22,360 | ) | (9,079 | ) | (8,889 | ) | |||||||
| Consolidated EBIT | 49,667 | 40,990 | 74,676 | 62,656 | |||||||||||
| Less: Interest expense | (8,713 | ) | (7,921 | ) | (1,850 | ) | (7,921 | ) | |||||||
| Less: Income tax expense | (8,219 | ) | (8,314 | ) | (15,548 | ) | (13,297 | ) | |||||||
| Net earnings | $ | 32,735 | 24,755 | 57,278 | 41,438 | ||||||||||
| ESCO TECHNOLOGIES INC. AND SUBSIDIARIES | |||||||||||||||
| Condensed Business Segment Information (Unaudited) - Continuing Operations basis | |||||||||||||||
| (Dollars in thousands) | |||||||||||||||
| GAAP | As Adjusted | ||||||||||||||
| YTD | YTD | YTD | YTD | ||||||||||||
| Q3 2026 | Q3 2025 | Q3 2026 | Q3 2025 | ||||||||||||
| Net Sales | |||||||||||||||
| Aerospace & Defense | $ | 462,341 | 307,819 | 462,341 | 307,819 | ||||||||||
| USG | 280,976 | 269,784 | 280,976 | 269,784 | |||||||||||
| Test | 194,710 | 165,111 | 194,710 | 165,111 | |||||||||||
| Totals | $ | 938,027 | 742,714 | 938,027 | 742,714 | ||||||||||
| EBIT | |||||||||||||||
| Aerospace & Defense | $ | 131,372 | 78,246 | 131,650 | 81,016 | ||||||||||
| USG | 63,998 | 62,808 | 64,929 | 63,140 | |||||||||||
| Test | 27,697 | 21,523 | 29,754 | 21,988 | |||||||||||
| Corporate | (88,779 | ) | (56,918 | ) | (28,322 | ) | (28,142 | ) | |||||||
| Consolidated EBIT | 134,288 | 105,659 | 198,011 | 138,002 | |||||||||||
| Less: Interest expense | (13,992 | ) | (12,373 | ) | (7,129 | ) | (12,373 | ) | |||||||
| Less: Income tax | (25,314 | ) | (21,841 | ) | (41,546 | ) | (29,279 | ) | |||||||
| Net earnings | $ | 94,982 | 71,445 | 149,336 | 96,350 | ||||||||||
| Note 1: Adjusted net earnings of $149.3 million in YTD 2026 exclude $54.3 million (or $2.09 per share) of after-tax charges consisting of: $0.09 of restructuring charges within Test, USG & A&D segments, $0.20 of debt financing and $0.23 of acquisition costs at Corporate related to the pending Megger acquisition and $1.57 of acquisition related amortization. | |||||||||||||||
| Note 2: Adjusted net earnings of $96.4 million in YTD 2025 exclude $24.9 million (or $0.95 per share) of after-tax charges consisting of: $0.15 of Corporate acquisition costs, $0.08 of Maritime inventory step-up charges and stamp duties, $0.02 of restructuring charges within the Test and USG segments, and $0.70 of acquisition related amortization. | |||||||||||||||
| EBITDA Reconciliation to Net earnings: | YTD | YTD | |||||||||||||
| YTD | YTD | Q3 2026 - | Q3 2025 - | ||||||||||||
| Q3 2026 | Q3 2025 | As Adj | As Adj | ||||||||||||
| Consolidated EBITDA | $ | 214,361 | 154,060 | 225,182 | 162,975 | ||||||||||
| Less: Depr & Amort | (80,073 | ) | (48,401 | ) | (27,171 | ) | (24,973 | ) | |||||||
| Consolidated EBIT | 134,288 | 105,659 | 198,011 | 138,002 | |||||||||||
| Less: Interest expense | (13,992 | ) | (12,373 | ) | (7,129 | ) | (12,373 | ) | |||||||
| Less: Income tax expense | (25,314 | ) | (21,841 | ) | (41,546 | ) | (29,279 | ) | |||||||
| Net earnings | $ | 94,982 | 71,445 | 149,336 | 96,350 | ||||||||||
| ESCO TECHNOLOGIES INC. AND SUBSIDIARIES | ||||||
| Condensed Consolidated Balance Sheets (Unaudited) | ||||||
| (Dollars in thousands) | ||||||
| June 30, 2026 | September 30, 2025 | |||||
| Assets | ||||||
| Cash and cash equivalents | $ | 73,236 | 101,350 | |||
| Accounts receivable, net | 267,493 | 253,554 | ||||
| Contract assets | 127,620 | 90,730 | ||||
| Inventories | 240,542 | 217,807 | ||||
| Other current assets | 46,620 | 25,065 | ||||
| Total current assets | 755,511 | 688,506 | ||||
| Property, plant and equipment, net | 175,282 | 172,493 | ||||
| Intangible assets, net | 664,450 | 723,973 | ||||
| Goodwill | 760,275 | 761,931 | ||||
| Operating lease assets | 47,271 | 47,707 | ||||
| Other assets | 17,214 | 15,778 | ||||
| $ | 2,420,003 | 2,410,388 | ||||
| Liabilities and Shareholders' Equity | ||||||
| Current maturities of long-term debt | $ | 20,000 | 20,000 | |||
| Accounts payable | 116,539 | 96,534 | ||||
| Contract liabilities | 288,142 | 216,590 | ||||
| Current income tax payable | 5,754 | 62,007 | ||||
| Other current liabilities | 116,258 | 113,017 | ||||
| Total current liabilities | 546,693 | 508,148 | ||||
| Deferred tax liabilities | 115,333 | 112,390 | ||||
| Non-current operating lease liabilities | 44,107 | 44,403 | ||||
| Other liabilities | 31,608 | 38,576 | ||||
| Long-term debt | 65,000 | 166,000 | ||||
| Shareholders' equity | 1,617,262 | 1,540,871 | ||||
| $ | 2,420,003 | 2,410,388 | ||||
| ESCO TECHNOLOGIES INC. AND SUBSIDIARIES | ||||||
| Consolidated Statements of Cash Flows (Unaudited) | ||||||
| (Dollars in thousands) | ||||||
| Nine Months Ended June 30, 2026 | Nine Months Ended June 30, 2025 | |||||
| Cash flows from operating activities: | ||||||
| Net earnings | $ | 96,159 | 80,571 | |||
| (Earnings) loss from discontinued operations | (1,177 | ) | (9,126 | ) | ||
| Adjustments to reconcile net earnings to net cash | ||||||
| provided by operating activities: | ||||||
| Depreciation and amortization | 80,073 | 48,401 | ||||
| Stock compensation expense | 10,182 | 7,934 | ||||
| Changes in assets and liabilities | 2,983 | (33,473 | ) | |||
| Effect of deferred taxes | 5,157 | (6,008 | ) | |||
| Net cash provided by operating activities - continuing operations | 193,377 | 88,299 | ||||
| Net cash provided (used) by operating activities-discontinued ops | (59,340 | ) | 43,703 | |||
| Net cash provided by operating activities | 134,037 | 132,002 | ||||
| Cash flows from investing activities: | ||||||
| Acquisition of business, net of cash acquired | (10,232 | ) | (472,006 | ) | ||
| Capital expenditures | (24,560 | ) | (24,210 | ) | ||
| Additions to capitalized software and other | (7,874 | ) | (13,018 | ) | ||
| Net cash used by investing activities - continuing operations | (42,666 | ) | (509,234 | ) | ||
| Net cash provided (used) by investing activities - discontinued ops | 1,540 | (966 | ) | |||
| Net cash used by investing activities | (41,126 | ) | (510,200 | ) | ||
| Cash flows from financing activities: | ||||||
| Proceeds from long-term debt | 130,000 | 645,000 | ||||
| Principal payments on long-term debt and short-term borrowings | (231,000 | ) | (242,000 | ) | ||
| Debt issuance costs | (1,293 | ) | - | |||
| Dividends paid | (6,216 | ) | (6,196 | ) | ||
| Other | (10,646 | ) | (6,205 | ) | ||
| Net cash (used) provided by financing activities | (119,155 | ) | 390,599 | |||
| Effect of exchange rate changes on cash and cash equivalents | (1,870 | ) | 452 | |||
| Net (decrease) increase in cash and cash equivalents | (28,114 | ) | 12,853 | |||
| Cash and cash equivalents, beginning of period | 101,350 | 65,963 | ||||
| Cash and cash equivalents, end of period | $ | 73,236 | 78,816 | |||
| ESCO TECHNOLOGIES INC. AND SUBSIDIARIES | ||||||||||||||
| Other Selected Financial Data (Unaudited) | ||||||||||||||
| (Dollars in thousands) | ||||||||||||||
| Backlog And Entered Orders - Q3 2026 | A&D | USG | Test | Total | ||||||||||
| Beginning Backlog - 4/1/26 | $ | 1,074,987 | 162,510 | 232,507 | 1,470,004 | |||||||||
| Entered Orders | 195,661 | 126,879 | 86,998 | 409,538 | ||||||||||
| Sales | (168,202 | ) | (99,963 | ) | (70,862 | ) | (339,027 | ) | ||||||
| Ending Backlog - 6/30/26 | $ | 1,102,446 | 189,426 | 248,643 | 1,540,515 | |||||||||
| Backlog And Entered Orders - YTD Q3 2026 | A&D | USG | Test | Total | ||||||||||
| Beginning Backlog - 10/1/25 | $ | 803,002 | 143,460 | 187,175 | 1,133,637 | |||||||||
| Entered Orders | 761,785 | 326,942 | 256,178 | 1,344,905 | ||||||||||
| Sales | (462,341 | ) | (280,976 | ) | (194,710 | ) | (938,027 | ) | ||||||
| Ending Backlog - 6/30/26 | $ | 1,102,446 | 189,426 | 248,643 | 1,540,515 | |||||||||
| ESCO TECHNOLOGIES INC. AND SUBSIDIARIES | |||
| Reconciliation of Non-GAAP Financial Measures (Unaudited) | |||
| EPS – Adjusted Basis Reconciliation – Q3 2026 | |||
| EPS Continuing Operations– GAAP Basis – Q3 2026 | $ | 1.26 | |
| Adjustments (defined below) | 0.94 | ||
| EPS Continuing Operations– As Adjusted Basis – Q3 2026 | $ | 2.20 | |
| Adjustments of $0.94 per share consisting primarily of: $0.03 of Test and USG | |||
| segment restructuring charges, $0.20 of debt financing and $0.19 of acquisition | |||
| costs at Corporate related to the pending Megger acquisition, and $0.52 of | |||
| acquisition related amortization. | |||
| EPS – Adjusted Basis Reconciliation – Q3 2025 | |||
| EPS Continuing Operations– GAAP Basis – Q3 2025 | $ | 0.96 | |
| Adjustments (defined below) | 0.64 | ||
| EPS Continuing Operations– As Adjusted Basis – Q3 2025 | $ | 1.60 | |
| Adjustments of $0.64 per share consisting primarily of: $0.15 of Corporate | |||
| acquisition costs, $0.08 of Maritime inventory step-up charges and stamp duties, | |||
| $0.01 of restructuring charges within the USG segment and $0.40 of acquisition | |||
| related amortization. | |||
| EPS – Adjusted Basis Reconciliation – YTD Q3 2026 | |||
| EPS Continuing Operations– GAAP Basis – YTD Q3 2026 | $ | 3.66 | |
| Adjustments (defined below) | 2.09 | ||
| EPS Continuing Operations – As Adjusted Basis – YTD Q3 2026 | $ | 5.75 | |
| Adjustments of $2.09 per share consisting primarily of: $0.09 of restructuring | |||
| charges within Test, USG and A&D segments, $0.20 of debt financing and $0.23 of | |||
| acquisition costs related to the pending Megger acquisition, and $1.57 of acquisition | |||
| related amortization. | |||
| EPS – Adjusted Basis Reconciliation – YTD Q3 2025 | |||
| EPS Continuing Operations– GAAP Basis – YTD Q3 2025 | $ | 2.76 | |
| Adjustments (defined below) | 0.95 | ||
| EPS Continuing Operations – As Adjusted Basis – YTD Q3 2025 | $ | 3.71 | |
| Adjustments of $0.95 per share consisting primarily of: $0.15 of Corporate | |||
| acquisition costs, $0.08 of Maritime inventory step-up charges and stamp duties, | |||
| $0.02 of restructuring charges within the Test and USG segments, and $0.70 of | |||
| acquisition related amortization. | |||
SOURCE ESCO Technologies Inc.
Kate Lowrey, Vice President of Investor Relations, (314) 213-7277
