Perma-Pipe Reports 5.1% Sales Growth to $158.4 Million for Fiscal Year Ending January 31, 2025

Perma-Pipe International Holdings, Inc. reported a net sales increase to $158.4 million for the fiscal year ending January 31, 2025, up from $150.7 million in the previous year. This growth of approximately 5.1% was primarily driven by higher sales volumes in the Middle East and Canada. The company's gross profit also rose significantly, reaching $53.2 million, or 34% of net sales, compared to $41.5 million, or 28% of net sales, in the prior year. This improvement in gross profit was attributed to both increased sales volumes and enhanced gross margins in key markets.

The company experienced a rise in general and administrative expenses, which totaled $28 million, an increase of $5.4 million from the previous year. This rise was mainly due to higher compensation costs and professional fees. Conversely, selling expenses decreased to $4.9 million from $5.5 million, reflecting lower payroll expenses. Interest expenses also saw a decline, totaling $1.9 million compared to $2.3 million in the prior year, due to reduced borrowings and lower interest rates. Despite these changes, net income attributable to common stock decreased slightly to $9 million from $10.5 million, reflecting the overall financial dynamics of the company.

Perma-Pipe's backlog as of January 31, 2025, was reported at $138.1 million, a significant increase from $68.4 million a year earlier. This growth in backlog was primarily due to new project awards in North America and the Middle East, indicating a strong demand for the company's piping systems. The company operates in a competitive market, with a diverse customer base and no single customer accounting for more than 10% of sales or accounts receivable in either of the last two fiscal years.

The company has also made strategic changes, including the appointment of Saleh Sagr as President in April 2025, who previously served as Senior Vice President for the MENA region. This leadership change is expected to enhance operational oversight in key international markets. Additionally, Perma-Pipe continues to face challenges related to raw material supply and pricing, exacerbated by inflationary pressures and transportation delays. The company has implemented strategies to mitigate these impacts, such as sourcing from alternative suppliers and adjusting customer pricing.

Looking ahead, Perma-Pipe anticipates that its existing cash reserves, cash flows from operations, and available credit facilities will be sufficient to meet its working capital needs and planned capital expenditures for the upcoming year. However, the company acknowledges the risks associated with market conditions, including fluctuations in oil and gas prices, which could impact customer order volumes and overall financial performance. The company remains focused on executing its strategic plan to achieve sustained profitability and positive cash flows in the future.