MANSFIELD — It was a banner year in 2025 for the Gorman-Rupp Company, according to president and CEO Scott King.
The Gorman-Rupp Company (NYSE: GRC) reported its financial results for the fourth quarter and year ended Dec. 31, 2025 in a press release issued on Feb. 6.
“We are proud to have attained record sales, adjusted earnings per share and incoming orders during the year. Full year sales increased across the majority of our markets and all markets saw an increase in incoming orders,” King said.
“We maintained the record gross margin rates we achieved in 2024 and effectively managed our SG&A costs throughout the year.”
Cash flow continued to be strong, enabling a $60 million reduction in debt, resulting in a significant decrease in interest expense, King noted. Improvements in operating income, combined with reduced interest expense, led to a 22-percent increase in adjusted earnings per share.
“As we begin 2026 our outlook remains positive. The 10-percent increase in incoming orders during 2025 increased our backlog to a healthy $244 million,” the CEO stated.
“We expect our municipal market to continue to benefit from infrastructure spending, including strong demand for flood control and storm water management, and expect a number of our markets to continue to benefit from increased demand related to data center construction.”
King said Gorman-Rupp’s strong cash flow positions it well to further reduce the company’s debt and interest expense going forward.
“I appreciate the Gorman-Rupp team’s continued efforts to contribute to another successful year, and I am grateful to our customers, suppliers, and shareholders for their on-going support,” King said.
Fourth quarter 2025 highlights
- Net sales of $166.6 million increased 2.4%, or $3.9 million, compared to the fourth quarter of 2024.
- Net income was $13.7 million, or $0.52 per share, compared to net income of $11.0 million, or $0.42 per share, for the fourth quarter of 2024.
- Adjusted earnings per share1 for the fourth quarter of 2025 and 2024 were $0.55 and $0.42, respectively.
- Incoming orders of $178.2 million increased 9.2%, or $15.1 million, compared to the fourth quarter of 2024.
Net sales for the fourth quarter of 2025 were $166.6 million compared to net sales of $162.7 million for the fourth quarter of 2024, an increase of 2.4% or $3.9 million.
Sales increased in the majority of our markets, including an increase of $2.8 million in the fire suppression market, $2.2 million in the industrial market, and $1.9 million in the OEM market all due in part to increased demand related to data centers.
Sales also increased $2.6 million in the agriculture market and $0.8 million in the repair market. These increases were partially offset by sales decreases of $4.0 million in the municipal market due to the timing of domestic flood control and wastewater projects.
Sales also decreased $2.2 million in the construction market primarily due to lower sales into the rental market, and decreased $0.2 million in the petroleum market.
Gross profit was $52.3 million for the fourth quarter of 2025, resulting in gross margin of 31.4%, compared to gross profit of $49.2 million and gross margin of 30.2% for the same period in 2024.
The 120 basis-point increase in gross margin was driven by a 110 basis-point improvement in labor and overhead leverage, due in part to an unusual increase in healthcare related costs in the prior year which did not recur, and a 10 basis point improvement in cost of material driven by a reduction in LIFO2 expense.
Selling, general and administrative (“SG&A”) expenses were $24.4 million and 14.7% of net sales for the fourth quarter of 2025 compared to $25.0 million and 15.4% of net sales for the same period in 2024. SG&A expenses decreased in part due to an unusual increase in healthcare related costs in the prior year which did not recur.
Operating income was $24.8 million for the fourth quarter of 2025, resulting in an operating margin of 14.9%, compared to operating income of $21.1 million and an operating margin of 13.0% for the same period in 2024.
The 190 basis-point increase in operating margin, compared to the same period in 2024, was driven by improved leverage on labor, overhead, and SG&A expenses due to increased sales and reduced healthcare costs.
Interest expense was $5.4 million for the fourth quarter of 2025 compared to $6.7 million for the same period in 2024. The decrease in interest expense was due primarily to a decrease in outstanding debt.
Other income (expense), net was $1.5 million of expense for the fourth quarter of 2025 compared to $0.7 million of expense for the same period in 2024. Other expense for the fourth quarter of 2025 included non-cash pension settlement charges of $1.2 million.
Net income was $13.7 million, or $0.52 per share, for the fourth quarter of 2025 compared to net income of $11.0 million, or $0.42 per share, in the fourth quarter of 2024. Adjusted earnings per share1 for the fourth quarter of 2025 and 2024 were $0.55 and $0.42 per share, respectively.
Adjusted EBITDA1 was $31.5 million and 18.9% of sales for the fourth quarter of 2025 compared to $29.0 million and 17.8% of sales for the fourth quarter of 2024.
2025 full year highlights
- Record net sales of $682.4 million increased 3.4%, or $22.7 million, compared to 2024
- Record net income was $53.0 million, or $2.02 per share, compared to $40.1 million, or $1.53 per share in 2024.
- Adjusted earnings per share1 for 2025 and 2024 were $2.14 and $1.75, respectively
- Record incoming orders of $728.4 million increased 10.5%, or $69.2 million, compared to 2024.
- Total debt decreased $60.0 million in 2025.
Net sales for 2025 were $682.4 million compared to net sales of $659.7 million for 2024, an increase of 3.4% or $22.7 million. Sales increased in the majority of our markets, including sales increases of $8.1 million in the industrial market and $6.6 million in the fire suppression market due in part to increased demand related to data centers.
Net sales also increased $5.2 million in the repair market, $4.9 million in the OEM market, $3.4 million in the municipal market, $2.4 million in the agriculture market, and $1.5 million in the petroleum market.
Offsetting these increases was a decrease of $9.4 million in the construction market due to a general slowdown in construction activity, including sales into the rental market.
Gross profit was $209.1 million for 2025, resulting in gross margin of 30.6%, compared to gross profit of $204.3 million and gross margin of 31.0% for the same period in 2024. Gross profit for 2025 included $2.7 million of one-time facility optimization costs.
The 40 basis-point decrease in gross margin was the result of one-time facility optimization costs recognized in the third quarter of 2025.
During the third quarter of 2025, based on changes in the agriculture market over the last few years, we took steps intended to optimize our National Pump Company (NPC) footprint.
We reduced the number of NPC operating facilities from six to three and expect this change to result in improved profitability by lowering our fixed operating costs with minimal impact on sales.
We have transitioned the NPC facility in Olive Branch, MS to our Patterson Pump Company operations to continue to support the growth we have seen in the fire, municipal and industrial markets.
During the third quarter, we recognized $3.0 million in one-time facility optimization costs including inventory rationalization, severance, and facility costs. We expect these changes will result in annualized savings of between $2.0 and $2.5 million in payroll, payroll related, and facility costs.
Selling, general and administrative (“SG&A”) expenses were $101.4 million and 14.9% of net sales for 2025 compared to $100.5 million and 15.2% of net sales for the same period in 2024.
Operating income was $95.4 million for 2025, resulting in an operating margin of 14.0%, compared to operating income of $91.4 million and an operating margin of 13.9% for the same period in 2024. Operating income for 2025 included $3.0 million of facility optimization costs.
The 10 basis-point increase in operating margin compared to the same period in 2024 was driven by improved leverage on labor, overhead, and SG&A expenses partially offset by facility optimization costs.
Interest expense was $23.4 million for 2025 compared to $33.6 million for the same period in 2024. The decrease in interest expense was due to a series of debt refinancing transactions the Company completed on May 31, 2024, as well as a decrease in outstanding debt.
Other income (expense), net was $2.8 million of expense for 2025 compared to $7.3 million of expense for the same period in 2024. Other expense for 2025 included non-cash pension settlement charges of $1.2 million.
Other expense for 2024 included a $4.4 million write-off of unamortized previously deferred debt financing fees and a $1.8 million prepayment fee related to the early retirement of a subordinated credit facility.
Net income was $53.0 million, or $2.02 per share, for 2025, compared to net income of $40.1 million, or $1.53 per share, for 2024. Adjusted earnings per share1 for 2025 and 2024 were $2.14 and $1.75 per share, respectively.
Adjusted EBITDA1 was $128.8 million and 18.9% of sales for 2025 compared to $124.6 million and 18.9% of sales for 2024.
The Company’s backlog of orders was $244.0 million at December 31, 2025 compared to $206.0 million at December 31, 2024. Incoming orders for 2025 were $728.4 million, an increase of 10.5%, or $69.2 million, compared to the same period in 2024.
Net cash provided by operating activities for 2025 was $106.2 million compared to $69.8 million for the same period in 2024. The increase in cash provided by operating activities in 2025 was primarily due to increased net income and an increase in operating liabilities.
Capital expenditures for 2025 were $17.4 million and consisted primarily of machinery and equipment. Capital expenditures for the full-year 2026 are presently planned to be approximately $20 to $22 million. Total debt decreased $60.0 million during 2025.
About Gorman-Rupp Company
Founded in 1933, The Gorman-Rupp Company is a leading designer, manufacturer and international marketer of pumps and pump systems for use in diverse water, wastewater, construction, dewatering, industrial, petroleum, original equipment, agriculture, fire suppression, heating, ventilating and air conditioning (HVAC), military and other liquid-handling applications.