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MILWAUKEE - Zurn Elkay Water Solutions Corporation (NYSE:ZWS) reported first quarter results that exceeded analyst expectations, as the water management company saw solid sales growth and margin expansion.
The company posted adjusted earnings per share of $0.31, topping the consensus estimate of $0.29. Revenue rose 4% year-over-year to $388.8 million, ahead of analysts’ projections of $383.88 million. Core sales, which exclude currency impacts, increased 5%.
Adjusted EBITDA margin expanded 110 basis points to 25.2% compared to 24.1% in the year-ago quarter. The company cited productivity initiatives and continuous improvement activities as drivers of the margin gains.
"We had a solid start to 2025, delivering first quarter core sales growth of 5% along with 25.2% adjusted EBITDA margins, an increase of 110 basis points year over year," said Todd A. Adams, Chairman and CEO.
For the second quarter, Zurn Elkay expects core sales growth in the low to mid-single digit range and adjusted EBITDA margin between 25.5% and 26.0%. The company reaffirmed its full-year 2025 guidance, saying first quarter results and the Q2 outlook put it on track to meet its original targets.
During the quarter, Zurn Elkay repurchased 2.3 million shares for $77 million and paid $15 million in dividends. The company ended the period with a net debt leverage ratio of 0.9x.
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