BATAVIA, N.Y. - Graham Corporation (NYSE:GHM), known for its expertise in critical fluid and power technologies, has secured over $65 million in contracts to supply equipment for defense and space applications. This announcement includes agreements to produce components for the Columbia-class submarine, space launch vehicles, and the MK48 Mod 7 Heavyweight Torpedo program.
The company will manufacture the MK19 Air Turbine Pump assembly for the Columbia-class submarine's torpedo ejection system. This contract, a result of a competitive bid, is part of the second quarter of fiscal 2025, concluding on September 30, 2024. Graham Corporation also won a contract to provide cryogenic recirculation pumps for thermal conditioning in upper stage engines of space launch vehicles during the same period.
Additionally, Graham Corporation has been awarded another option year to supply alternators and regulators for the MK48 Mod 7 Heavyweight Torpedo program, a contract that was secured in the first quarter of fiscal 2025, which ended on June 30, 2024.
These contracts are expected to contribute to the company's revenue over the next three to eight years, with the MK19 program extending the longest. The earnings from these contracts were anticipated in Graham Corporation's fiscal 2025 outlook.
Matthew Malone, Vice President of Graham Corporation, attributes the contract wins to the company's investment in expanding capacity and enhancing capabilities to serve the defense and space industries. He emphasizes their strong customer relationships, engineering expertise, and rigorous testing and qualification processes as differentiating factors in securing these high-value projects.
All products for these contracts will be produced at the company's operations in Arvada, Colorado. Graham Corporation is a global leader in designing and manufacturing technologies for various industries, including defense, space, energy, and process industries. This information is based on a press release statement.
In other recent news, Graham Corporation has announced significant developments. The company has reported its highest-ever revenue and orders for fiscal year 2024, with a record revenue of $185.5 million and a gross margin of 21.9%. Net income was at $4.6 million, and adjusted EPS increased by 163% to $0.63.
Graham Corporation also secured a $2.1 million contract from BlueForge Alliance to expand its welding training programs, aiming to enhance production capacity and support the U.S. Navy's Submarine Industrial Base. This investment is expected to result in more than a 20% increase in skilled labor at the Batavia facility by early 2025.
The company has revised its executive cash bonus program for fiscal year 2025, affecting potential payouts for its top executives based on specified company and individual performance objectives. In the future, Graham Corporation projects its revenue for fiscal year 2025 to range from $200 million to $210 million, with an adjusted EBITDA forecast of $16.5 million to $19.5 million. These are among the recent developments for Graham Corporation.
InvestingPro Insights
As Graham Corporation (NYSE:GHM) continues to secure significant contracts in the defense and space sectors, its financial metrics and market performance provide a broader context for investors. With a market capitalization of $330.9 million, Graham Corporation stands out for its robust balance sheet, holding more cash than debt, which is a reassuring sign for investors concerned about financial stability.
InvestingPro data shows that the company is trading at a high earnings multiple, with a P/E ratio of 71.79, indicating that investors have high expectations for the company's future earnings growth. This is supported by the company's net income, which is expected to grow this year, as highlighted in one of the InvestingPro Tips. Moreover, the company's EBITDA growth over the last twelve months was a remarkable 64.89%, showcasing its ability to expand its earnings before interest, taxes, depreciation, and amortization, which can be a useful indicator of the company's financial performance.
Another InvestingPro Tip points out that analysts predict the company will be profitable this year, which aligns with the company's positive revenue growth of 18.09% over the last twelve months. Furthermore, the company's stock has experienced a significant price uptick over the last six months, with a 38.62% total return over that period, reflecting investor confidence in its growth trajectory.
For investors seeking more in-depth analysis, additional InvestingPro Tips are available, providing valuable insights into Graham Corporation's financial health and market performance. Currently, there are 11 additional tips listed on InvestingPro for Graham Corporation, which can be accessed for further guidance on investment decisions.
Note: All financial figures are in USD and based on the latest available data as of the fourth quarter of 2024.
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