Graham Corporation reported a significant increase in financial performance for the first quarter of fiscal 2026, ending June 30, 2025. The company achieved net sales of $55.5 million, an 11% increase from $50.0 million in the same period last year. This growth was primarily driven by a 33% rise in sales to the Energy & Process sector, attributed to strong demand in the Chemical/Petrochemical and New Energy markets. The company's gross profit also improved, reaching $14.7 million with a gross margin of 26.5%, up from 24.8% in the prior year, reflecting better sales mix and operational efficiencies.
In terms of profitability, Graham Corporation's net income rose to $4.6 million, or $0.42 per diluted share, compared to $3.0 million, or $0.27 per diluted share, in the previous year. This represents a 55% increase in net income year-over-year. The company also reported adjusted net income of $4.9 million, a 38% increase from $3.6 million in the same quarter last year. The increase in net income was supported by a reduction in selling, general, and administrative expenses as a percentage of sales, which decreased to 17.7% from 18.6%.
Operationally, Graham Corporation's backlog increased significantly to $482.9 million, a 22% rise from $396.8 million a year earlier. The company booked orders totaling $125.9 million during the quarter, which included substantial follow-on orders for the U.S. Navy's Virginia Class Submarine program. The book-to-bill ratio for the quarter was reported at 2.3x, indicating strong demand relative to sales. The company’s international sales accounted for 17% of total sales, with the U.S. market representing 83%.
Strategically, Graham Corporation has made notable organizational changes, including a leadership transition where Daniel J. Thoren moved from CEO to Executive Chairman, and Matthew J. Malone was appointed as the new CEO. The company continues to invest in its operations, with capital expenditures of $7.0 million during the quarter, primarily for facility expansions and equipment upgrades. These investments are aimed at enhancing production capabilities, particularly in the Defense sector.
Looking ahead, Graham Corporation has reiterated its full-year guidance for fiscal 2026, projecting net sales between $225 million and $235 million, with gross profit margins expected to range from 24.5% to 25.5%. The company anticipates continued growth driven by strong demand in its core markets, particularly in defense and energy sectors, while also navigating potential challenges from increased tariffs and market conditions.
About GRAHAM CORP
Graham Corporation designs and manufactures mission-critical fluid, heat transfer, vacuum, and turbomachinery products for defense, energy, and space markets. Its offerings include custom-engineered systems for nuclear propulsion, oil refining, renewable energy, and space exploration. Serving government agencies, OEMs, and industrial clients worldwide, the company emphasizes advanced engineering, quality, and flexible production to deliver complex, high-reliability solutions across diverse, enduring markets.
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