Crawford United Reports Earnings Growth, Shares Outperform Market
Shares of Crawford United Corporation (CRAWA) are up 3.8% following the company’s earnings report for the quarter ending December 31, 2024. This performance contrasts sharply with the S&P 500 Index, which declined by 1.8% during the same period. Over the last month, CRAWA’s stock has increased by 9.5%, whereas the S&P 500 has experienced a 3.9% downturn.
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Earnings Growth and Segment Performance
Crawford United’s sales reached $150.2 million in 2024, increasing by 4.4% from $143.9 million in 2023. Net income rose 2.3% to $13.6 million, translating to $3.83 per diluted share, compared to $3.77 per share the prior year. Operating income grew 9.8% to $19.7 million from $17.9 million, and EBITDA also saw a rise of 3.8% to $26.5 million, up from $25.6 million.
In the fourth quarter of 2024, Crawford United reported sales of $37.4 million, up 10.5% from $33.8 million in the same period of 2023. Operating income surged 40.9% to $4.7 million from $3.4 million year-over-year, while net income increased by 21.9% to $3.9 million, or $1.11 per diluted share. EBITDA rose by 26.4%, reaching $6.4 million compared to $5.1 million in 2023.
The Commercial Air Handling Equipment segment benefited from strong market demand, with sales climbing 13% to $65.9 million in 2024, compared to $58.4 million in the previous year. Operating profit for this segment grew by 27.8% to $19.6 million, leading to a 29.8% profit margin, an increase from 26.3% in 2023.
Conversely, the Industrial and Transportation Products segment experienced a slight decline, with sales falling 1.5% to $84.2 million from $85.5 million. This segment suffered due to a $10.4 million reduction in marine products and machined defense parts. However, revenue growth from acquisitions and an increase in machined aerospace parts partially offset these losses. Operating profit for this segment dropped 33% to $5.1 million, resulting in a margin of 6%, down from 8.9% in the previous year.
Crawford United Corporation Price, Consensus, and EPS Surprise
Crawford United Corporation price-consensus-eps-surprise-chart | Crawford United Corporation Quote
Additional Business Metrics
The company’s gross margin improved to 27.7% in 2024 from 26.2% in 2023, aided by a favorable sales mix towards the more profitable Commercial Air Handling segment. Selling, general, and administrative expenses rose 11.4% to $21.9 million, driven by inflationary labor costs and expenses associated with recent acquisitions. Fortunately, interest expenses decreased by 20.6% to $0.9 million, down from $1.3 million, benefiting from reduced debt levels.
Strategic Insights from Management
CEO Brian Powers conveyed optimism about the company’s long-term strategy, emphasizing Crawford United’s commitment to enhancing revenue and profitability through both organic growth and strategic acquisitions. He highlighted the company’s strengthened position in aerospace and defense following acquisitions made in 2024 and noted that Crawford United ended the year with no senior bank debt for the first time since 2017.
Market Outlook and Future Guidance
Crawford United did not issue formal guidance but indicated a strong focus on expanding within essential industries such as aerospace, defense, healthcare, and transportation. The management is attentive to broader economic conditions, including supply chain disruptions, fluctuations in raw material prices, and geopolitical volatility.
Recent Developments
In 2024, Crawford United completed two key acquisitions: Heany Industries in the first quarter and Advanced Industrial Coatings (AIC) in the third quarter. Heany provides coatings for aerospace and biomedical applications, while AIC specializes in high-performance coatings for semiconductor and medical markets. These acquisitions are expected to enhance Crawford United’s footprint in rapidly growing sectors.
Additionally, CRAWA exercised an option to purchase its Phoenix, AZ facility, previously leased for its CAD Enterprises subsidiary. The $6.9 million transaction was financed through a term loan from MidFirst Bank.
CRAWA also exercised an option to purchase its Phoenix, AZ facility, previously leased for its CAD Enterprises subsidiary. The acquisition, valued at $6.9 million, was financed with a term loan from MidFirst Bank.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
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