Zurn Elkay Water 2025 Q2 Earnings Strong Performance as Net Income Rises 9.8%

Zurn Elkay Water (ZWS) reported its fiscal 2025 Q2 earnings on Jul 29th, 2025. The total revenue of Zurn Elkay Water increased by 7.9% to $444.50 million in 2025 Q2, up from $412 million in 2024 Q2, with specific segment revenue listed as follows: Institutional: $217.80 million, Commercial: $125.60 million, All other: $101.10 million and Total: $444.50 million.

In the second quarter of 2025, Zurn Elkay Water showcased earnings per share (EPS) growth of 11.1%, rising from $0.27 to $0.30 compared to the previous year. The company also demonstrated increased profitability, with net income reaching $50.50 million, a 9.8% rise from the $46 million reported in Q2 2024. The solid EPS growth reflects positively on the company's financial health.

Zurn Elkay Water has consistently delivered strong returns with its post-earnings strategy over the past three years. The approach of purchasing shares after a revenue increase and holding for 30 days has resulted in a 151.53% return, significantly surpassing the benchmark return of 87.35%. This strategy demonstrates ZWS's ability to leverage its revenue growth effectively, yielding an excess return of 64.18%. The strategy's compound annual growth rate stands at 20.38%, with a maximum drawdown of 0.00%, indicating robust risk-adjusted returns and minimal downside risk. Such performance underscores the company's strength in capitalizing on post-earnings price movements.

CEO Commentary
Todd A. Adams, Chairman and Chief Executive Officer, noted that Zurn Elkay Water Solutions is successfully navigating global tariff dynamics, leveraging supply chain diversity and selective pricing strategies to achieve strong results. The company reported an 8% year-over-year core sales growth, driven by customer buy-ahead and early benefits from recent pricing actions. Adjusted EBITDA margins reached a record 26.5%, exceeding guidance, while free cash flow exceeded $100 million for the first time. Adams highlighted stable end-markets in non-residential sectors and a weaker residential market, expressing confidence in ongoing organic growth initiatives and an improved full-year outlook.

Guidance
Zurn Elkay Water Solutions anticipates third quarter core sales growth and adjusted EBITDA margins to mirror the strong results delivered in the second quarter. The company raised its full-year outlook, expecting core sales growth of at least 5% year over year, adjusted EBITDA between $420 million and $430 million, up from a previous range of $405 million to $420 million, and full-year free cash flow of approximately $300 million. This outlook assumes the current tariff structure remains unchanged throughout 2025.

Additional News
Zurn Elkay Water Solutions recently declared a quarterly cash dividend of $0.09 per share, payable on September 5, 2025, to stockholders of record as of August 20, 2025. The company, headquartered in Milwaukee, WI, is recognized for its sustainable water management solutions, offering products ranging from water safety to filtered drinking water systems. In addition, Zurn Elkay has been recognized as one of America's Climate Leaders for 2025 by USA TODAY, noting a significant 33% reduction in greenhouse gas emissions intensity. Furthermore, Zurn Elkay marked its 125th anniversary with a major donation to Erie's Public Schools, providing filtered water stations and other resources, reinforcing its commitment to community and sustainability initiatives.