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PPIH's Q2 Earnings Rise Y/Y on Strong North America, MENA Sales
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Shares of Perma-Pipe International Holdings, Inc. (PPIH - Free Report) have gained 2.5% since the company reported its earnings for the quarter ended July 31, 2026. This compares with the S&P 500 index’s 0.2% decline over the same time frame. Over the past month, the stock has advanced 12.1%, while the S&P 500 has fallen 1.1%.
Perma-Pipe reported second-quarter fiscal 2026 earnings per share of 31 cents, which rose from 10 cents a year earlier.
Net sales rose 24.4% year over year to $59.6 million from $47.9 million, driven by higher volumes in North America and the Middle East and North Africa (MENA) region.
Net income attributable to common stock climbed to $2.5 million from $0.9 million, while gross profit increased 20.7% to $17.4 million. However, gross margin contracted to 29.2% from 30.1%.
Perma-Pipe International Holdings, Inc. Price, Consensus and EPS Surprise
Operating income increased to $4.3 million from $3.2 million, while income before taxes rose to $3.9 million from $2.8 million. Adjusted income before taxes, which excludes selected nonrecurring items, increased to $8.3 million from $4.9 million.
Backlog reached $142.3 million at quarter-end, up from $136.5 million at April 30, 2026 and $121.6 million at Jan. 31, 2026. Perma-Pipe secured more than $67 million of new orders during the quarter, including oil and gas awards in MENA and Canada and its first critical-cooling infrastructure award in MENA.
Management Commentary
Management said the quarter reflected continued commercial momentum across Perma-Pipe’s core markets. Chief executive officer Saleh Sagr highlighted the ramp-up of the new Ohio facility, increased production at the Qatar facility and continued demand across oil and gas, infrastructure and critical-cooling applications. Management also emphasized leak detection as an increasingly important part of its strategy, with the business supported by infrastructure owners’ focus on pipeline integrity and asset protection.
The company continues to focus on localized manufacturing as it expands geographically, particularly across North America and MENA. Management also cited opportunities tied to water infrastructure, digital infrastructure and energy projects as areas of potential demand.
Factors Influencing the Headline Numbers
Higher sales volumes in North America and MENA supported the revenue increase, but profitability faced some cost pressures. Gross margin declined as increased materials and logistics costs and the ramp-up of the Ohio manufacturing facility offset some of the benefit from higher activity.
General and administrative expenses rose to $11.9 million from $10 million and included a $3.9 million charge related to an uncollectible customer receivable and roughly $0.5 million of Ohio start-up costs. The year-ago quarter included a $2 million nonrecurring executive-compensation charge. Earnings also benefited from a lower effective tax rate of approximately 16% versus 54% a year earlier, largely reflecting a roughly $1.6 million discrete tax benefit related to the receivable provision.
Balance Sheet and Cash Flow Update
Cash and cash equivalents rose to $31.8 million as of July 31, 2026, from $18.7 million at Jan. 31, 2026.
Total assets increased to $232.6 million from $217.5 million.
Long-term debt, less current maturities, increased to $30 million from $12.7 million. Stockholders’ equity increased to $93.5 million from $90.6 million.
For the first six months of fiscal 2026, operating activities generated $13.3 million of cash, compared with $1.3 million of cash used in the prior-year period.
Outlook
Management said historical backlog conversion patterns suggest roughly 40-50% of backlog could convert to revenue in the third quarter. Management also expects the Ohio facility to ramp to full production by early 2027 as capacity utilization increases.
Other Developments
Management said it has been restructuring Perma-Pipe’s global sales network over the past half-year, adding personnel and resources at the business, regional and corporate levels to support expansion and business development.
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PPIH's Q2 Earnings Rise Y/Y on Strong North America, MENA Sales
Shares of Perma-Pipe International Holdings, Inc. (PPIH - Free Report) have gained 2.5% since the company reported its earnings for the quarter ended July 31, 2026. This compares with the S&P 500 index’s 0.2% decline over the same time frame. Over the past month, the stock has advanced 12.1%, while the S&P 500 has fallen 1.1%.
Perma-Pipe reported second-quarter fiscal 2026 earnings per share of 31 cents, which rose from 10 cents a year earlier.
Net sales rose 24.4% year over year to $59.6 million from $47.9 million, driven by higher volumes in North America and the Middle East and North Africa (MENA) region.
Net income attributable to common stock climbed to $2.5 million from $0.9 million, while gross profit increased 20.7% to $17.4 million. However, gross margin contracted to 29.2% from 30.1%.
Perma-Pipe International Holdings, Inc. Price, Consensus and EPS Surprise
Perma-Pipe International Holdings, Inc. price-consensus-eps-surprise-chart | Perma-Pipe International Holdings, Inc. Quote
Other Key Business Metrics
Operating income increased to $4.3 million from $3.2 million, while income before taxes rose to $3.9 million from $2.8 million. Adjusted income before taxes, which excludes selected nonrecurring items, increased to $8.3 million from $4.9 million.
Backlog reached $142.3 million at quarter-end, up from $136.5 million at April 30, 2026 and $121.6 million at Jan. 31, 2026. Perma-Pipe secured more than $67 million of new orders during the quarter, including oil and gas awards in MENA and Canada and its first critical-cooling infrastructure award in MENA.
Management Commentary
Management said the quarter reflected continued commercial momentum across Perma-Pipe’s core markets. Chief executive officer Saleh Sagr highlighted the ramp-up of the new Ohio facility, increased production at the Qatar facility and continued demand across oil and gas, infrastructure and critical-cooling applications. Management also emphasized leak detection as an increasingly important part of its strategy, with the business supported by infrastructure owners’ focus on pipeline integrity and asset protection.
The company continues to focus on localized manufacturing as it expands geographically, particularly across North America and MENA. Management also cited opportunities tied to water infrastructure, digital infrastructure and energy projects as areas of potential demand.
Factors Influencing the Headline Numbers
Higher sales volumes in North America and MENA supported the revenue increase, but profitability faced some cost pressures. Gross margin declined as increased materials and logistics costs and the ramp-up of the Ohio manufacturing facility offset some of the benefit from higher activity.
General and administrative expenses rose to $11.9 million from $10 million and included a $3.9 million charge related to an uncollectible customer receivable and roughly $0.5 million of Ohio start-up costs. The year-ago quarter included a $2 million nonrecurring executive-compensation charge. Earnings also benefited from a lower effective tax rate of approximately 16% versus 54% a year earlier, largely reflecting a roughly $1.6 million discrete tax benefit related to the receivable provision.
Balance Sheet and Cash Flow Update
Cash and cash equivalents rose to $31.8 million as of July 31, 2026, from $18.7 million at Jan. 31, 2026.
Total assets increased to $232.6 million from $217.5 million.
Long-term debt, less current maturities, increased to $30 million from $12.7 million. Stockholders’ equity increased to $93.5 million from $90.6 million.
For the first six months of fiscal 2026, operating activities generated $13.3 million of cash, compared with $1.3 million of cash used in the prior-year period.
Outlook
Management said historical backlog conversion patterns suggest roughly 40-50% of backlog could convert to revenue in the third quarter. Management also expects the Ohio facility to ramp to full production by early 2027 as capacity utilization increases.
Other Developments
Management said it has been restructuring Perma-Pipe’s global sales network over the past half-year, adding personnel and resources at the business, regional and corporate levels to support expansion and business development.