Enerpac Tool Group 2025 Q3 Earnings Mixed Results as Net Income Declines 14.5%

Enerpac Tool Group (EPAC) reported its fiscal 2025 Q3 earnings on June 27th, 2025. The company’s revenue surpassed expectations with a 5.5% increase, reaching $158.66 million compared to $150.39 million in the same quarter last year. However, Enerpac’s EPS and net income faced declines, with EPS falling 12.8% to $0.41 and net income dropping 14.5% to $22.04 million from the previous year's $25.78 million. Enerpac maintained its full-year fiscal 2025 guidance, expecting net sales between $610 million and $625 million, with adjusted EBITDA projected between $150 million and $160 million.

Revenue

The total revenue for Enerpac Tool Group rose by 5.5% to $158.66 million in the third quarter of fiscal 2025, compared to $150.39 million in the same period of 2024.

Earnings/Net Income

Enerpac Tool Group's earnings per share (EPS) decreased by 12.8% to $0.41 in Q3 2025 from $0.47 in Q3 2024. Concurrently, the company's net income fell by 14.5% to $22.04 million from $25.78 million in the same quarter of the previous year, indicating a challenging financial performance this quarter.

Price Action

The stock price of Enerpac Tool Group dropped by 7.71% on the latest trading day, decreased by 1.63% over the past week, and has fallen 5.12% month-to-date.

Post-Earnings Price Action Review

The investment strategy of buying Enerpac Tool Group stock when revenues exceed expectations and holding for 30 days has historically yielded a 74.93% return, outperforming the benchmark significantly. Despite experiencing a maximum drawdown of -29.43%, the strategy has maintained a reasonable Sharpe ratio of 0.56, indicating favorable risk-adjusted returns. The 30-day holding period provided a buffer against market volatility, resulting in a less severe maximum drawdown in comparison to the overall return. This approach has proven effective in capitalizing on revenue beats by allowing time for temporary market fluctuations to settle.

CEO Commentary

Paul E. Sternlieb, CEO, President & Director, stated, "We were pleased with our performance in the quarter...two of our three geographic regions...posted strong growth...total year-over-year revenue growth was 6%...we are taking a cautious posture entering the fourth quarter given the increasing level of economic and geopolitical uncertainty...we believe Enerpac can continue to outperform its industrial peers...we have moved and are settling into our new downtown Milwaukee headquarters...it is clear already that the move is achieving our goal of creating a more vibrant environment...orders are robust and backlog is expanding as we successfully implement our strategy to cross-sell DTA solutions across the existing Enerpac base."

Guidance

For the full fiscal year 2025, Enerpac anticipates net sales of $610 million to $625 million, reflecting total revenue growth of 3% to 6% and organic growth of 0% to 2%. Adjusted EBITDA is expected to range from $150 million to $160 million, with a focus on the lower half of this range. The company continues to project free cash flow between $85 million and $95 million.

Additional News

In corporate developments, Enerpac Tool Group has recently completed its relocation to a new headquarters in downtown Milwaukee. This move is expected to enhance collaboration and innovation through a more vibrant working environment and a newly expanded Innovation Lab. Additionally, the company has implemented restructuring actions to align its cost base better and maintain financial health amid challenging industrial conditions. Furthermore, Enerpac returned approximately $14 million to shareholders through share repurchases, demonstrating its ongoing commitment to delivering shareholder value. These strategic moves highlight Enerpac's proactive approach to navigating current market challenges and positioning for future growth.