Argan, Inc. Reports First Quarter Fiscal 2027 Results

About this update from Argan, Inc.

Argan, Inc. (NYSE: AGX) (“Argan” or the “Company”) today announces financial results for its first quarter of fiscal year 2027 ended April 30, 2026. The Company will host an investor conference call today, June 4, 2026, at 5:00 p.m. ET. Consolidated Financial Highlights ($ in thousands, except per share data)       April 30,         For the Quarter Ended:   2026   2025   Change   Revenues   $ 290,954   $ 193,660   $ 97,294   Gross profit     61,114     36,863     24,251   Gross margin %     21.0 %   19.0 %   2.0 % Net income   $ 46,063   $ 22,550   $ 23,513   Diluted earnings per share     3.24     1.60     1.64   Adjusted EBITDA (1)     56,439     31,487     24,952   Adjusted EBITDA margin (1)     19.4 %   16.3 %   3.1 % Cash dividends per share   $ 0.500   $ 0.375   $ 0.125       April 30,   January 31,       As of:   2026   2026   Change Cash, cash equivalents and investments   $ 973,555   $ 894,981   $ 78,574   Net liquidity (2)     421,419     421,000     419   Share repurchase treasury stock, at cost     134,969     114,361     20,608   Project backlog     2,767,000     2,929,000     (162,000 ) (1)   Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. Please refer to “Non-GAAP Financial Measures.” (2)   Net liquidity, or working capital, is defined as total current assets less total current liabilities. David Watson, President and Chief Executive Officer of Argan, commented, “We delivered a strong start to fiscal 2027 with record revenue of $291 million, gross margin of 21%, diluted earnings per share of $3.24, and adjusted EBITDA of $56.4 million. Our first quarter results reflect exceptional execution across our business, with all three of our operating segments achieving significant revenue growth as compared to the first quarter of fiscal 2026. “Our project pipeline remains robust, with heightened demand for our capabilities as the electrification of everything, the onshoring of domestic manufacturing, and the proliferation of data centers continue to create an urgent need for additional energy infrastructure. Gas-fired plants remain the ideal solution for delivering the reliable, uninterrupted power needed, and only a limited number of firms are able to successfully execute these complex projects. The robust demand environment, coupled with our proven track record, allows us a disciplined approach in choosing the right projects, in the right locations, with the right partners. “Our industrial segment is also seeing increased demand, highlighted by a data center contract we were awarded in November 2025 for the fabrication of pressure vessels. In support of this project and to better position us to address new opportunities, we have begun construction on a new fabrication facility in North Carolina, which we expect to complete during the third quarter of fiscal 2027. “Argan remains very well positioned with the skill set, financial flexibility, industry relationships and longstanding customer base to capitalize on the current demand environment as we strengthen our leadership role as a partner of choice for the buildout of energy and industrial infrastructure.” First Quarter Results Consolidated revenues for the quarter ended April 30, 2026, were $291.0 million, an increase of $97.3 million, or 50.2%, from consolidated revenues of $193.7 million reported for the comparable prior-year quarter. The year-over-year increase reflects higher revenues across all of the Company’s business segments. In the Power segment, revenue growth was driven by the continued ramp-up of construction activities on recently awarded contracts. For the quarter ended April 30, 2026, Argan's consolidated gross profit was $61.1 million, or 21.0% of consolidated revenues, compared to $36.9 million, or 19.0% of consolidated revenues, for the quarter ended April 30, 2025. The increase primarily reflects improved gross profit margins in the Power segment, driven by a shift in project and contract mix, strong project execution, and the achievement of substantial completion ahead of schedule on the final Midwest Solar and Battery Project. Selling, general and administrative expenses were $15.7 million and $12.5 million for the three months ended April 30, 2026 and 2025, respectively, and represented 5.4% and 6.5% of corresponding consolidated revenues, respectively. Other income, net, for the three months ended April 30, 2026 was $8.4 million, which primarily reflected investment income earned during the period. For the quarter ended April 30, 2026, Argan achieved net income of $46.1 million, or $3.24 per diluted share, compared to $22.6 million, or $1.60 per diluted share, for last year’s first quarter. EBITDA for the quarter ended April 30, 2026 increased to $54.4 million compared to $30.3 million for the same quarter of last year. Adjusted EBITDA for the quarter ended April 30, 2026 increased to $56.4 million compared to $31.5 million for the same quarter of last year. Argan continues to generate significant cash flow and increased its total balance of cash, cash equivalents and investments during the quarter. The total balances were $973.6 million and $895.0 million as of April 30, 2026 and January 31, 2026, respectively. Balance sheet net liquidity was $421.4 million at April 30, 2026 and $421.0 million at January 31, 2026; furthermore, the Company had no debt. As of April 30, 2026, consolidated project backlog was approximately $2.8 billion, as compared to approximately $2.9 billion at January 31, 2026. Conference Call and Webcast Argan will host a conference call and webcast for investors today, June 4, 2026, at 5:00 p.m. ET. Domestic stockholders and interested parties may participate in the conference call by dialing (888) 506-0062 and international participants should dial (973) 528-0011; all callers shall use access code: 208616. The call and the accompanying slide deck will also be webcast at: https://www.webcaster5.com/Webcast/Page/2961/54078 The conference call and slide deck may also be accessed via the Investor Center section of the Company’s website at https://arganinc.com/investor-center . Please allow extra time prior to the call to visit the site. A replay of the teleconference will be available until June 18, 2026, and can be accessed by dialing 877-481-4010 (domestic) or 919-882-2331 (international). The replay access code is 54078. A replay of the webcast can be accessed until June 4, 2027. About Argan Argan’s primary business is providing a full range of construction and related services to the power industry. Argan’s service offerings focus on the engineering, procurement, and construction of natural gas-fired power plants and renewable energy facilities, along with related commissioning, maintenance, project development and technical consulting services, through its Gemma Power Systems and Atlantic Projects Company operations. Argan also owns The Roberts Company, which is a fully integrated industrial construction, fabrication and plant services company, and SMC Infrastructure Solutions, which provides teledata infrastructure services. Non-GAAP Financial Measures The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”). Within this press release, the Company makes reference to earnings before interest, taxes, depreciation and amortization (“EBITDA”), Adjusted EBITDA, and Adjusted EBITDA margin, each of which is a non-GAAP financial measure. The Company defines Adjusted EBITDA as EBITDA adjusted to exclude the impact of non-cash stock-based compensation expense. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by total revenues. The Company believes these non-GAAP financial measures provide useful supplemental information to management and investors in evaluating the Company's operating performance because they exclude certain items that may not be indicative of the Company's core operating results or may affect comparability between periods or among companies with different capital structures, tax positions, depreciation policies, or equity compensation practices. Adjusted EBITDA and Adjusted EBITDA margin exclude stock-based compensation expense, a non-cash item that management believes impacts the comparability of operating results between reporting periods. These non-GAAP financial measures should be considered in conjunction with, and not as substitutes for, the GAAP financial information presented in this press release. These measures have limitations as analytical tools because they exclude certain items, including interest, income tax expense, depreciation and amortization expense, and in the case of Adjusted EBITDA and Adjusted EBITDA margin, stock-based compensation expense. The methods used by the Company to calculate these non-GAAP financial measures may differ from methods used by other companies and, as a result, may not be comparable to similarly titled measures reported by other companies. Financial tables at the end of this press release provide reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures. Safe Harbor Statement Certain matters discussed in this press release may constitute forward-looking statements within the meaning of the federal securities laws. Reference is hereby made to the cautionary statements made by the Company with respect to risk factors set forth in its most recent reports on Form 10-K, Forms 10-Q and other SEC filings. The Company’s future financial performance is subject to risks and uncertainties including, but not limited to, the successful addition of new contracts to project backlog, the receipt of corresponding notices to proceed with contract activities, and the Company’s ability to successfully complete the projects that it obtains. Actual results and the timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements due to the risk factors highlighted above and described regularly in the Company’s SEC filings. Argan, Inc. and Subsidiaries Condensed Consolidated Statements of Earnings (In thousands, except per share data)       Three Months Ended     April 30,     2026   2025     (Unaudited) REVENUES   $ 290,954     $ 193,660 Cost of revenues     229,840       156,797 GROSS PROFIT     61,114       36,863 Selling, general and administrative expenses     15,719       12,521 INCOME FROM OPERATIONS     45,395       24,342 Other income, net     8,374       5,444 INCOME BEFORE INCOME TAXES     53,769       29,786 Provision for income taxes     7,706       7,236 NET INCOME     46,063       22,550               OTHER COMPREHENSIVE INCOME, NET OF TAXES             Foreign currency translation adjustments     (541 )     3,621 Net unrealized (losses) gains on available-for-sale securities     (2,659 )     2,680 COMPREHENSIVE INCOME   $ 42,863     $ 28,851               EARNINGS PER SHARE             Basic   $ 3.30     $ 1.65 Diluted   $ 3.24     $ 1.60               WEIGHTED AVERAGE SHARES OUTSTANDING             Basic     13,959       13,628 Diluted     14,197       14,112               CASH DIVIDENDS PER SHARE   $ 0.500     $ 0.375 Argan, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Dollars in thousands, except per share data)                   April 30,   January 31,     2026   2026     (Unaudited)       ASSETS             CURRENT ASSETS             Cash and cash equivalents   $ 355,847     $ 339,481   Investments     617,708       555,500   Accounts receivable, net     130,808       133,677   Contract assets     36,917       43,397   Other current assets     74,828       60,202   TOTAL CURRENT ASSETS     1,216,108       1,132,257   Property, plant and equipment, net     18,271       16,596   Goodwill     28,033       28,033   Intangible assets, net     1,375       1,450   Deferred taxes, net     —       —   Right-of-use and other assets     22,651       8,018   TOTAL ASSETS   $ 1,286,438     $ 1,186,354                 LIABILITIES AND STOCKHOLDERS’ EQUITY             CURRENT LIABILITIES             Accounts payable   $ 123,850     $ 107,540   Accrued expenses     105,065       89,748   Contract liabilities     565,774       513,969   TOTAL CURRENT LIABILITIES     794,689       711,257   Deferred taxes, net     4,907       6,555   Noncurrent liabilities     13,331       6,280   TOTAL LIABILITIES     812,927       724,092                 STOCKHOLDERS’ EQUITY             Preferred stock, par value $0.10 per share – 500,000 shares authorized; no shares issued and outstanding     —       —   Common stock, par value $0.15 per share – 30,000,000 shares authorized; 15,828,289 shares issued; 14,020,427 and 13,950,712 shares outstanding at April 30, 2026 and January 31, 2026, respectively     2,374       2,374   Additional paid-in capital     163,233       167,234   Retained earnings     445,255       406,197   Treasury stock, at cost – 1,807,862 and 1,877,577 shares at April 30, 2026 and January 31, 2026, respectively     (134,969 )     (114,361 ) Accumulated other comprehensive (loss) income     (2,382 )     818   TOTAL STOCKHOLDERS’ EQUITY     473,511       462,262   TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY   $ 1,286,438     $ 1,186,354   Argan, Inc. and Subsidiaries Adjusted EBITDA and Adjusted EBITDA Margin Reconciliations (Dollars in thousands) (Unaudited)                     Three Months Ended       April 30,       2026   2025   Revenues   $ 290,954   $ 193,660                   Net income, as reported   $ 46,063   $ 22,550   Provision for income taxes     7,706     7,236   Depreciation     559     415   Amortization of intangible assets     75     98   EBITDA     54,403     30,299   Stock-based compensation expense     2,036     1,188   Adjusted EBITDA   $ 56,439   $ 31,487   Adjusted EBITDA margin     19.4 %   16.3 %   View source version on businesswire.com: https://www.businesswire.com/news/home/20260604142927/en/

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