Crawford United Corporation Reports $3.1 Million Net Income and 12.7% Sales Growth for Q1 2025

Crawford United Corporation reported a net income of $3.1 million, or $0.88 per diluted share, for the three months ended March 31, 2025, reflecting a slight increase from the $3.0 million, or $0.85 per diluted share, recorded in the same period last year. Total sales for the quarter reached $43.3 million, a 12.7% increase from $38.4 million in the prior year, primarily driven by the acquisitions of Rahn Industries and Advanced Industrial Coatings. The company's gross profit also rose to $12.1 million, up from $10.2 million, with a gross margin improvement to 27.8% from 26.7% due to a higher proportion of sales from the Commercial Air Handling segment, which operates at higher margins.

Operating expenses increased to $7.2 million from $5.7 million year-over-year, largely attributed to the costs associated with the recent acquisitions and investments in talent to support growth. Interest charges rose to $0.3 million from $0.2 million, reflecting an increase in average total debt due to the financing of acquisitions. The company reported total other expenses of $0.4 million, significantly higher than the previous year's $0.1 million, primarily due to merger and acquisition-related fees.

In terms of operational metrics, the Commercial Air Handling Equipment segment saw sales increase to $21.1 million, a 24.1% rise from $17.0 million, while the Industrial and Transportation Products segment reported sales of $22.2 million, up 3.6% from $21.5 million. The operating profit for the Commercial Air Handling segment was $4.9 million, while the Industrial and Transportation Products segment reported $1.4 million. The overall operating income for the company was $4.9 million, compared to $4.6 million in the prior year.

Crawford United's cash flow from operating activities was $0.4 million for the quarter, a decrease from $2.8 million in the same period last year, primarily due to timing issues related to milestone billings on large projects. Cash used in investing activities increased to $12.7 million, driven by the acquisition of Rahn, compared to $6.8 million in the prior year, which was mainly for the acquisition of Heany. Financing activities provided $12.5 million, up from $5.1 million, as the company utilized its revolving credit facility to fund acquisitions.

Looking ahead, Crawford United remains optimistic about its growth trajectory, supported by its recent acquisitions and a strong market position. The company believes its cash reserves and available borrowing capacity will be sufficient to meet working capital needs and service debt obligations over the next 12 months. However, management acknowledges potential risks, including supply chain disruptions and inflationary pressures, which could impact future performance.