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- **Revenue Beat**: 7% YoY growth driven by diversified end markets, including 10.6% in Aerospace & Defense and 15.8% in Industrials.
- **Profit Margin Expansion**: Gross margin +300 bps to 29.8%, EBITDA margin 15.4% (vs. 12.7% YoY). Adjusted EBITDA up 29.6%.
- **Strategic Wins**: Secured data center and infrastructure projects, reducing oil & gas cyclicality risk.
- **2026 Growth Drivers**: Aerospace, infrastructure, and power generation. Cross-selling integrated solutions to existing customers.
- **Cash Flow Focus**: Normalizing free cash flow in 2026 after ERP implementation delays.

**【CEO Summary Section】**
- **Revenue Growth**: 7% year-over-year (YoY) driven by all five largest end markets, including 8.1% in Energy, 10.6% in Aerospace & Defense, and 15.8% in Industrials.
- **Profitability**: Record adjusted EBITDA of $30.2 million (15.4% margin), up 29.6% YoY. Gross margin expanded 300 basis points to 29.8% due to favorable business mix and operational efficiencies.
- **Strategic Wins**: Secured long-term projects with Batchelor & Kimball (data centers) and Bechtel (Hanford P Project), diversifying beyond core energy markets.
- **Vision 2030**: Focused on integrated solutions (e.g., PCMS adoption), new customer acquisition, and operational efficiency improvements.

**【CFO Financial Commentary】**
- **Q3 Financials**: Revenue $195.5 million (+7% YoY), gross profit up $9.3 million (19% growth). Adjusted EBITDA $30.2 million (+29.6% YoY). GAAP net income $13.1 million ($0.41 EPS).
- **Full Year Guidance**: Revenue $716-720 million (flat YoY), adjusted EBITDA $86-88 million (vs. $82.5 million in 2024). Free cash flow expected in Q4, with normalization in 2026.
- **Liquidity**: Net debt $174.5 million, trailing 12-month leverage ~2.7x. Prioritized debt reduction and cash flow management.

**【Q&A Highlights】**
- **Oil & Gas Breakdown**: Removed subcategory reporting due to customer overlap. Downstream (+14%), midstream (low single-digit), upstream (stable). LNG sector strong.
- **Field Services vs. Labs**: Field services down 1% YoY, but in-lab services up 12% (driven by aerospace & defense). PCMS (data solutions) grew 25% YoY.
- **Aerospace Growth**: Capacity expansion via hub-and-spoke model, with joint customer funding for CapEx. Defense sector growth and European expansion opportunities.
- **Data Centers**: New projects (e.g., Batchelor & Kimball) leverage existing testing methods (UT, thermal imaging) for data infrastructure.
- **2026 Outlook**: Aerospace, infrastructure, and power generation expected to lead growth. Cross-selling integrated solutions (e.g., PCMS + rope access) generating $3-3.5 million in Q3.

Mistras Group, Inc. (MG) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

MG

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