Argan, Inc. Reports First Quarter Fiscal 2026 Results

Company Reports Record Backlog of $1.9 Billion

Argan, Inc. (NYSE: AGX) ("Argan" or the "Company") today announces financial results for its first quarter of fiscal year 2026 ended April 30, 2025. The Company will host an investor conference call today, June 4, 2025, at 5:00 p.m. ET.

Consolidated Financial Highlights
($ in thousands, except per share data)
		April 30,
For the Quarter Ended:		2025				2024				Change
Revenues			193,660				157,682				35,978
Gross profit			36,863				17,944				18,919
Gross margin			19.0				11.4				7.6
Net income			22,550				7,882				14,668
Diluted earnings per share			1.60				0.58				1.02
EBITDA			30,299				11,890				18,409
EBITDA as a of revenues			15.6				7.5				8.1
Cash dividends per share			0.375				0.300				0.075

		April 30,				January 31,
As of:		2025				2025				Change
Cash, cash equivalents and investments			546,457				525,137				21,320
Net liquidity (1)			315,127				301,443				13,684
Share repurchase treasury stock, at cost			114,018				105,643				8,375
Project backlog			1,856,000				1,361,000				495,000

(1)

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, "Our first quarter results reflect a strong start to fiscal 2026, with consolidated revenue growth of 23% to $193.7 million, gross margin of 19.0%, significantly enhanced diluted earnings per share of $1.60, and EBITDA of $30.3 million. During the first quarter, we also received full notice to proceed for the Sandow Lakes Power Station, a 1.2 GW ultra-efficient combined-cycle natural gas-fired plant in Lee County, Texas, which increased our backlog to a record $1.9 billion as of April 30, 2025.

"In addition to our record backlog, our project pipeline is robust, reflecting the energy industry's urgent response to the growing strain on our power grids related to the building of data centers, the onshoring of complex manufacturing, and an increasing amount of EV charging activity. These activities require a constant supply of high-quality, reliable energy. For the first time in decades, energy demand is rising, coinciding with the end of the operational lives for a significant portion of the aging natural gas energy facilities capable of providing reliable, 24/7 power. After several years of underinvestment, there is an immediate need for the development of new energy resources, and Argan's energy-agnostic capabilities and proven track record of success position us well as we compete for the construction of large and complex power generating facilities.

"While we are excited about the number of opportunities we are seeing, we remain disciplined in our pursuit of profitable growth and committed to driving the best outcomes for the projects we take on. Argan is well positioned with the capabilities, financial flexibility, industry relationships and longstanding customer base to strengthen our leadership role as a partner of choice for the buildout of energy infrastructure."

First Quarter Results

Consolidated revenues for the quarter ended April 30, 2025 were $193.7 million, an increase of $36.0 million, or 23%, from consolidated revenues of $157.7 million reported for the comparable prior year quarter. The increase in the number of current projects and contract backlog has resulted in increased project activity and the related revenues compared to the prior year quarter. During the first quarter of fiscal 2026, several recently awarded gas-fired power plant projects were in their early stages of activity with limited revenues while the Company's mature projects continued to generate significant activity.

For the quarter ended April 30, 2025, Argan's consolidated gross profit was $36.9 million, or 19.0% of consolidated revenues. The consolidated gross margin for the quarter reflects the changing mix of projects and contract types. Last year, during the first quarter ended April 30, 2024, gross profit was negatively impacted by a loss on an overseas project. Consolidated gross profit for the quarter ended April 30, 2024 was $17.9 million, or 11.4% of consolidated revenues.

Selling, general and administrative expenses increased by $1.1 million to $12.5 million for the quarter ended April 30, 2025, from $11.4 million in the comparable prior year quarter. However, as a percentage of revenues, these expenses declined to 6.5% in the first quarter of fiscal 2026 as compared to 7.2% in the first quarter of fiscal 2025.

Other income, net, for the three months ended April 30, 2025 was $5.4 million, which primarily reflected investment income earned during the period. During the quarter ended April 30, 2025, the Company recorded income tax expense of $7.2 million, primarily due to consolidated pre-tax book income of $29.8 million. For the comparable period last year, Argan recorded income tax expense of $3.4 million on pre-tax book income of $11.3 million.

For the quarter ended April 30, 2025, Argan achieved net income of $22.6 million, or $1.60 per diluted share, compared to $7.9 million, or $0.58 per diluted share, for last year's first quarter. EBITDA for the quarter ended April 30, 2025 increased to $30.3 million compared to $11.9 million in the same quarter of last year.

Argan maintained a substantial total balance of cash, cash equivalents and investments during the quarter. The total balances were $546.5 million and $525.1 million as of April 30, 2025 and January 31, 2025, respectively. Balance sheet net liquidity was $315.1 million at April 30, 2025 and $301.4 million at January 31, 2025; furthermore, the Company had no debt.

Conference Call and Webcast

Argan will host a conference call and webcast for investors today, June 4, 2025, at 5:00 p.m. ET.

Domestic stockholders and interested parties may participate in the conference call by dialing [phone] and international participants should dial [phone]; all callers shall use access code: 698123.

The call and the accompanying slide deck will also be webcast at:

https://www.webcaster4.com/Webcast/Page/2961/52474

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, 2025, and can be accessed by dialing 877-481-4010 (domestic) or 919-882-2331 (international). The replay access code is 52474. A replay of the webcast can be accessed until June 4, 2026.

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 telecommunications 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"), a non-GAAP financial measure. The Company believes that the non-GAAP financial measure described in this press release is important to management and investors because the measure supplements the understanding of Argan's ongoing operating results, excluding the effects of capital structure, depreciation, amortization, and income tax rates. The non-GAAP financial measure referred to above should be considered in conjunction with, and not as a substitute for, the GAAP financial information presented in this press release. Financial tables at the end of this press release provide a reconciliation of the non-GAAP financial measures to the 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,
		2025			2024
		(Unaudited)
REVENUES			193,660			157,682
Cost of revenues			156,797			139,738
GROSS PROFIT			36,863			17,944
Selling, general and administrative expenses			12,521			11,425
INCOME FROM OPERATIONS			24,342			6,519
Other income, net			5,444			4,794
INCOME BEFORE INCOME TAXES			29,786			11,313
Income tax expense			7,236			3,431
NET INCOME			22,550			7,882
OTHER COMPREHENSIVE INCOME, NET OF TAXES
Foreign currency translation adjustments			3,621			(790
Net unrealized gains (losses) on available-for-sale securities			2,680			(969
COMPREHENSIVE INCOME			28,851			6,123
EARNINGS PER SHARE
Basic			1.65			0.59
Diluted			1.60			0.58
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic			13,628			13,257
Diluted			14,112			13,572
CASH DIVIDENDS PER SHARE			0.375			0.300

ARGAN, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share data)
		April 30,				January 31,
		2025				2025
		(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents			189,251				145,263
Investments			357,206				379,874
Accounts receivable, net			106,499				175,808
Contract assets			30,358				28,430
Other current assets			54,763				51,925
TOTAL CURRENT ASSETS			738,077				781,300
Property, plant and equipment, net			14,512				14,463
Goodwill			28,033				28,033
Intangible assets, net			1,728				1,826
Deferred taxes, net							552
Right-of-use and other assets			9,805				10,053
TOTAL ASSETS			792,155				836,227
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable			69,266				97,297
Accrued expenses			69,891				83,319
Contract liabilities			283,793				299,241
TOTAL CURRENT LIABILITIES			422,950				479,857
Deferred taxes, net			667
Noncurrent liabilities			4,643				4,513
TOTAL LIABILITIES			428,260				484,370
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; 13,638,569 and 13,634,214 shares outstanding at April 30, 2025 and January 31, 2025, respectively			2,374				2,374
Additional paid-in capital			165,598				168,966
Retained earnings			310,178				292,698
Treasury stock, at cost 2,189,720 and 2,194,075 shares at April 30, 2025 and January 31, 2025, respectively			(114,018				(105,643
Accumulated other comprehensive loss			(237				(6,538
TOTAL STOCKHOLDERS' EQUITY			363,895				351,857
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY			792,155				836,227

ARGAN, INC. AND SUBSIDIARIES
RECONCILIATION TO EBITDA
(In thousands) (Unaudited)
		Three Months Ended
		April 30,
		2025			2024
Net income, as reported			22,550			7,882
Income tax expense			7,236			3,431
Depreciation			415			480
Amortization of intangible assets			98			97
EBITDA			30,299			11,890

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Contacts:

Company Contact:
David Watson
301.315.0027

Investor Relations Contacts:
John Nesbett/Jennifer Belodeau
IMS Investor Relations
203.972.9200
[e-mail]