Third Quarter 2026
Filed Nov 3, 2026Enpro Reports Third Quarter 2026 Results; Raises Full-Year Guidance
Third-quarter sales increased 22.4%, adjusted EBITDA increased 31.7%, both segments delivered double-digit sales growth, free cash flow increased for the nine-month period, and the company raised full-year 2026 revenue, adjusted EBITDA and adjusted diluted earnings per share guidance.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net sales - third quarter 2026GAAP | $350.8M | – | 22.4% |
| Net sales - nine months ended September 30, 2026GAAP | $992.6M | – | 17.1% |
| Cost of sales - third quarter 2026GAAP | $197.6M | – | – |
| Cost of sales - nine months ended September 30, 2026GAAP | $560.4M | – | – |
| Gross profit - third quarter 2026GAAP | $153.2M | – | – |
| Gross profit - nine months ended September 30, 2026GAAP | $432.2M | – | – |
| Selling, general and administrative expense - third quarter 2026GAAP | $89.4M | – | – |
| Selling, general and administrative expense - nine months ended September 30, 2026GAAP | $264.5M | – | – |
| Other operating expense - third quarter 2026GAAP | $500K | – | – |
| Other operating expense - nine months ended September 30, 2026GAAP | $3.3M | – | – |
| Total operating expenses - third quarter 2026GAAP | $89.9M | – | – |
| Total operating expenses - nine months ended September 30, 2026GAAP | $267.8M | – | – |
| Operating income - third quarter 2026GAAP | $63.3M | – | – |
| Operating income - nine months ended September 30, 2026GAAP | $164.4M | – | – |
| Operating margin - third quarter 2026GAAP | 18.0% | – | 370 bps |
| Operating margin - nine months ended September 30, 2026GAAP | 16.6% | – | 150 bps |
| Interest expense - third quarter 2026GAAP | −$8.7M | – | – |
| Interest expense - nine months ended September 30, 2026GAAP | −$26.8M | – | – |
| Interest income - third quarter 2026GAAP | $500K | – | – |
| Interest income - nine months ended September 30, 2026GAAP | $1.5M | – | – |
| Other expense - third quarter 2026GAAP | −$600K | – | – |
| Other expense - nine months ended September 30, 2026GAAP | −$17.9M | – | – |
| Income before income taxes - third quarter 2026GAAP | $54.5M | – | – |
| Income before income taxes - nine months ended September 30, 2026GAAP | $121.2M | – | – |
| Income tax expense - third quarter 2026GAAP | −$14.2M | – | – |
| Income tax expense - nine months ended September 30, 2026GAAP | −$26.4M | – | – |
| Net income - third quarter 2026GAAP | $40.3M | – | 86.6% |
| Net income - nine months ended September 30, 2026GAAP | $94.8M | – | 30.8% |
| Basic earnings per share - third quarter 2026GAAP | $1.90 | – | – |
| Basic earnings per share - nine months ended September 30, 2026GAAP | $4.49 | – | – |
| Diluted earnings per share - third quarter 2026GAAP | $1.88 | – | 86.1% |
| Diluted earnings per share - nine months ended September 30, 2026GAAP | $4.44 | – | 30.2% |
| Adjusted net income - third quarter 2026non-GAAP | $57M | – | 34.4% |
| Adjusted net income - nine months ended September 30, 2026non-GAAP | $156.2M | – | 24.2% |
| Adjusted diluted earnings per share - third quarter 2026non-GAAP | $2.66 | – | 33.7% |
| Adjusted diluted earnings per share - nine months ended September 30, 2026non-GAAP | $7.30 | – | 23.3% |
| Adjusted EBITDA - third quarter 2026non-GAAP | $91.3M | – | 31.7% |
| Adjusted EBITDA - nine months ended September 30, 2026non-GAAP | $254.6M | – | 22.2% |
| Adjusted EBITDA margin - third quarter 2026non-GAAP | 26.0% | – | 180 bps |
| Adjusted EBITDA margin - nine months ended September 30, 2026non-GAAP | 25.6% | – | 100 bps |
| Net cash provided by operating activities - nine months ended September 30, 2026GAAP | $172.8M | – | – |
| Free cash flow - nine months ended September 30, 2026non-GAAP | $129.2M | – | – |
| Capital expenditures - nine months ended September 30, 2026other | $43.6M | – | – |
| Purchases of property, plant and equipment - nine months ended September 30, 2026GAAP | −$39.9M | – | – |
| Payments for capitalized internal-use software - nine months ended September 30, 2026GAAP | −$3.7M | – | – |
| Cash and cash equivalents - September 30, 2026GAAP | $83.4M | – | – |
| Total debt - September 30, 2026GAAP | $520.7M | – | – |
| Net leverage ratio - September 30, 2026other | 1.4x to trailing twelve month adjusted EBITDA | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Sealing Technologies - third quarter 2026Strength in aerospace, domestic general industrial and compositional analysis applications, as well as strategic pricing initiatives, offset in part by slow European general industrial and food and biopharmaceutical demand. Commercial vehicle OEM demand improved year-over-year. | $214.7M | – | 20.5% |
| Advanced Surface Technologies - third quarter 2026Strong performance was led by leading-edge precision cleaning solutions, as well as increased demand for semiconductor capital equipment and coatings. | $136.5M | – | 25.8% |
Full-year 2026 outlook
- Revenue$1.33 billion to $1.34 billion, or a 16% to 17% increase year over year
- NoteAdjusted EBITDA in the range of $340 million to $345 million
- NoteAdjusted diluted earnings per share in the range of $9.70 to $9.95
Capital returns
- The company paid a regular quarterly dividend of $0.32 per share during the third quarter.
- Dividend payments totaled $20.6 million for the nine months ended September 30, 2026.
- Enpro declared a regular quarterly dividend of $0.32 per share on October 28, 2026, payable on December 16, 2026 to shareholders of record as of the close of business on December 2, 2026.
- The Board approved a new share repurchase authorization in October 2026 for up to $50 million of shares; it expires in October 2028.
- No shares were purchased under the prior repurchase program.
What drove it
- Consolidated sales increased 16.9% excluding foreign exchange translation and contributions from the AlpHa Measurement Solutions and Overlook Industries acquisitions.
- Improved semiconductor demand drove AST sales, while aerospace, domestic general industrial and compositional analysis applications supported Sealing Technologies.
- Strategic pricing initiatives contributed to sales growth.
- Operating leverage from strong sales growth supported profitability, partly offset by expenses supporting growth initiatives.
- Higher net income and lower cash taxes were the primary drivers of the increase in free cash flow.
Concerns
- Slow European general industrial and food and biopharmaceutical demand partially offset Sealing Technologies sales growth.
- Corporate expense was $13.5 million in the third quarter of 2026, compared with $10.2 million last year, primarily due to higher incentive compensation accruals and restructuring costs.
- The company cited risks related to cyclical end markets, tariffs and trade measures, raw-material availability and pricing, foreign exchange rates, interest rates, semiconductor growth execution, and AST reliance on a small number of significant customers.
What to watch
- Whether robust demand across the portfolio continues into 2027, particularly semiconductor capital equipment, coatings and leading-edge precision cleaning solutions.
- Sealing Technologies demand in European general industrial, food and biopharmaceutical end markets.
- Execution on reinvestment in organic growth initiatives, facility expansions and strategic acquisitions.
- The pace of debt reduction, working-capital investment supporting demand and capital expenditures supporting growth initiatives.
- Delivery against full-year 2026 guidance of $1.33 billion to $1.34 billion in revenue, $340 million to $345 million in adjusted EBITDA and $9.70 to $9.95 in adjusted diluted earnings per share.
Balance sheet and cash flow
- Cash flow from operating activities was $172.8 million for the nine months ended September 30, 2026, versus $138.5 million last year.
- Free cash flow was $129.2 million, net of $43.6 million in capital expenditures, versus $104.9 million, net of $33.6 million in capital expenditures last year.
- Enpro ended the third quarter with total debt of $520.7 million and cash and cash equivalents of $83.4 million.
- The company reduced outstanding revolving debt by $55.0 million during the third quarter and $135.0 million year-to-date.
- Long-term debt was $520.5 million as of September 30, 2026, compared with $655.1 million as of December 31, 2025.
- Cash and cash equivalents were $83.4 million as of September 30, 2026, compared with $114.7 million as of December 31, 2025.
Analysis
Enpro reported a strong third quarter ended September 30, 2026. Net sales were $350.8 million, up 22.4%, while net income increased to $40.3 million from $21.6 million. GAAP diluted earnings per share increased to $1.88 from $1.01. Adjusted EBITDA increased 31.7% to $91.3 million and adjusted EBITDA margin expanded 180 basis points to 26.0%, indicating operating leverage on higher sales despite continued growth investments.
Both operating segments contributed to growth. Sealing Technologies sales increased 20.5% to $214.7 million, including contributions from the AlpHa Measurement Solutions and Overlook Industries acquisitions; sales increased 11.6% excluding foreign exchange translation and those acquisitions. Advanced Surface Technologies sales increased 25.8% organically to $136.5 million, led by precision cleaning solutions and semiconductor capital equipment and coatings demand. AST adjusted segment EBITDA margin increased 500 basis points to 25.1%, while Sealing Technologies adjusted segment EBITDA margin was 32.6%.
Cash generation strengthened through the first nine months. Cash flow from operating activities was $172.8 million and free cash flow was $129.2 million, compared with $138.5 million and $104.9 million, respectively, in the prior-year period. The company identified higher net income and lower cash taxes as primary drivers, while also noting working-capital investments and higher capital expenditures supporting growth initiatives. Enpro reduced outstanding revolving debt by $135.0 million year-to-date and ended the quarter with total debt of $520.7 million, cash and cash equivalents of $83.4 million, and a net leverage ratio of 1.4x to trailing twelve month adjusted EBITDA.
Capital allocation included $20.6 million of dividend payments during the first nine months and a replacement authorization permitting up to $50 million of share repurchases through October 2028. No shares were purchased under the prior program. The company raised full-year 2026 guidance to revenue of $1.33 billion to $1.34 billion, adjusted EBITDA of $340 million to $345 million, and adjusted diluted earnings per share of $9.70 to $9.95, citing robust demand and momentum into 2027.
The key operating offset remains uneven end-market demand. Management cited slow European general industrial and food and biopharmaceutical demand, while corporate expense increased to $13.5 million from $10.2 million, primarily on higher incentive compensation accruals and restructuring costs. The forward outlook also specifically excludes changes subsequent to September 30, 2026 in shares outstanding, future acquisitions, dispositions and related transaction costs, restructuring costs, foreign exchange rates, and incremental tariff or trade-tension effects subsequent to November 3, 2026.
Management, verbatim
Our strong third quarter performance reflects our disciplined execution and success of Enpro 3.0 as we continue to accelerate profitable growth across the organization,
Eric Vaillancourt, President and Chief Executive Officer
We remain focused on reinvesting in attractive organic growth opportunities across both segments to deliver on our Enpro 3.0 growth targets. Strong cash generation and a healthy balance sheet provide us with significant flexibility to invest in areas of the portfolio with higher growth rates and superior profitability and pursue strategic acquisitions that expand our capabilities and align with our disciplined financial criteria,
Eric Vaillancourt, President and Chief Executive Officer
Not in the filing
stated, not guessed- GAAP gross margin was not reported.
- Quarterly operating cash flow and quarterly free cash flow were not reported.
- GAAP effective tax rate was not reported.
- Prior-quarter comparisons were not reported for the reported income-statement and segment metrics.
- Previous-release outlook was not provided; therefore, no actual-versus-prior-guidance comparison is included.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.