AZZ AZZ Inc

$AZZ Record quarter in both segments, and the GAAP line is the misleading one. Sales rose 16.7% to 486.9 million dollars, adjusted EPS rose 29% to 2.00 dollars. GAAP EPS fell 34% to 1.94 dollars, but that comp had a large AVAIL joint venture gain in it last year. Adjusted EBITDA margin expanded to 22.8% from 21.3%, operating cash flow rose 76% to 102.8 million dollars, and management raised the full-year guide: sales to 1.825 to 1.875 billion dollars, adjusted EPS to 7.00 to 7.30 dollars. Call is tomorrow at 11 AM ET.

$AZZ (hot-dip galvanizing and coil coating) raised its FY2027 adjusted EPS guide to $7.00-$7.30 from $6.75-$7.15 after Q2 (to Aug 31) adjusted EPS of $2.00, up 29.0%, on sales of $486.9M, up 16.7%. At the Oct 12 close of $137.82, about 19-20x the new range; net leverage is 1.3x. Against: GAAP EPS fell 34.2% to $1.94 as year-ago Q2 held AZZ's share of AVAIL's gain on selling its Electrical Products Group (AZZ keeps a minority stake); Q2 was helped by the $57.5M Seattle Galvanizing buy and passed-through vendor price hikes. Call Oct 14, 11:00 ET.

$AZZ Q2 '27 Earnings Results & Recap • Reported GAAP EPS of $2.00 up 29.03% YoY • Reported revenue of $486.89M up 16.68% YoY • AZZ Inc. raised FY2027 guidance to sales of $1.825-$1.88B, Adjusted EBITDA of $380M, and Adjusted Diluted EPS of $7.00-$7.30 for the year ending February 28, 2027.

S&P Global Ratings upgraded AZZ’s issuer credit rating to BB from BB-, citing faster debt repayment and sustained improvements in leverage. The agency also raised its senior secured debt rating to BB+ from BB, with a recovery rating of 2. AZZ’s S&P-adjusted leverage fell to 1.4x in fiscal Q1 2027, well below the agency’s 2x threshold. Since its debt-funded acquisition of Precoat Metals in fiscal 2023, AZZ has reduced adjusted debt from about $1.3 billion to $550 million, including a $300 million reduction in fiscal 2026. S&P expects AZZ to generate more than $200 million in operating free cash flow this year, supported by lower interest expense and margin expansion. Management is targeting net leverage of 1x-2x while resuming bolt-on acquisitions, with about $30 million spent so far this year and annual capital spending rising to $80 million-$100 million. Data-center construction and public infrastructure spending continue to offset weakness in commercial and residential markets. $AZZ