ARGAN, Inc. Reports 22.8% Revenue Growth and 186.1% Increase in Net Income

ARGAN, Inc. reported significant financial growth in its latest quarterly results, with revenues reaching $193.7 million for the three months ended April 30, 2025, a 22.8% increase from $157.7 million in the same period last year. The company's net income surged to $22.6 million, or $1.60 per diluted share, compared to $7.9 million, or $0.58 per diluted share, in the prior year, reflecting a 186.1% increase in profitability. This growth was primarily driven by a substantial rise in revenues from the power industry services segment, which accounted for approximately 82.8% of total revenues, bolstered by ongoing construction activities on several key projects.

The company experienced notable changes in its operational metrics compared to the previous fiscal period. The gross profit margin improved significantly, rising to 19.0% from 11.4% year-over-year, attributed to a favorable project mix and the resolution of prior losses on overseas projects. Selling, general, and administrative expenses increased modestly to $12.5 million, representing 6.5% of revenues, down from 7.2% in the previous year. Additionally, ARGAN's cash and cash equivalents increased to $189.3 million, up from $145.3 million at the end of January 2025, indicating a strong liquidity position.

Strategically, ARGAN has been active in expanding its project backlog, which grew to $1.9 billion as of April 30, 2025, up from $1.4 billion at the end of January 2025. This backlog is primarily composed of projects within the power industry services segment, including a 1.2 GW natural gas-fired power plant in Texas and a biofuel power plant in Ireland. The company also repurchased 55,117 shares of its common stock during the quarter, reflecting its commitment to returning value to shareholders, with a total repurchase authorization now at $150 million.

Operationally, ARGAN's customer base remains concentrated, with two major customers accounting for 30% and 25% of consolidated revenues. The company reported a decrease in accounts receivable, which fell by $69.3 million, primarily due to successful collections from project-related receivables. The company’s employee headcount remained stable, supporting its ongoing projects across the U.S., Ireland, and the U.K.

Looking ahead, ARGAN anticipates continued growth driven by increasing electricity demand in the U.S. and ongoing investments in renewable energy projects. However, the company also acknowledges potential challenges, including rising material costs due to tariffs and supply chain uncertainties. Management remains optimistic about the future, emphasizing its commitment to expanding its project portfolio and maintaining strong financial health.