Griffon Corporation

Third-quarter revenue was $481 million, up 7% year over year, with 6% favorable price/mix and 1% volume growth. Adjusted EBITDA was $125 million, up 2% year over year, and EBITDA margin was 25.9%. Gross profit was $226 million with a 47% gross margin versus $219 million and 48.7% in the prior-year quarter. Adjusted net income from continuing operations was $68 million, or $1.51 per share, versus $64 million, or $1.39 per share, last year; GAAP income from continuing operations was $66 million, or $1.47 per share, versus a loss of $109 million, or $2.40 per share, in the prior year, mainly due to prior-year impairment charges. Year-to-date free cash flow from continuing operations was $194 million, and net capital expenditures were $24 million. For fiscal 2026, management maintained revenue guidance at $1.8 billion and adjusted EBITDA guidance at $458 million, expects free cash flow from continuing operations to exceed net income from continuing operations, and still expects capex of $50 million, depreciation of $27 million, amortization of $15 million, interest expense of $80 million, and a normalized tax rate of 28%.

Ron Kramer said Griffon executed particularly well and described the quarter as solid operationally and financially despite soft U.S. housing and commercial construction markets. He emphasized that the company’s transformation is now substantially complete and that Griffon is a pure-play building products company. His tone was confident and constructive, with repeated references to operating leverage, market-share gains, and longer-term upside as residential and commercial demand improve.

Brian Harris highlighted 7% revenue growth, 2% EBITDA growth, and a 25.9% EBITDA margin, while gross margin eased to 47% from 48.7% due to higher material and SG&A costs. He said year-to-date free cash flow was $194 million, net capex was $24 million, and free cash flow should exceed full-year net income. He also pointed to net debt of $1.2 billion, leverage of 2.2x at June 30, and approximately 2.0x pro forma for the Australasia transaction closing, with the new target leverage range set at 1.5x to 2.5x. He noted fiscal 2026 interest expense is now expected to be $80 million, $13 million below prior guidance, helped by debt paydown and interest income from transaction note receivables.

Analysts focused on pricing, volume mix, cost inflation, and whether competitor disruption could create share gains. Management said it remains capable of fulfilling demand and is always looking to increase market share, while also noting that price and mix were about equal in the quarter and that the price increase should continue working through backlog. On costs, Brian Harris said most price-cost catch-up should occur in Q4 and that the pricing actions were intended to offset raw materials, labor, energy, distribution, and logistics inflation. Questions also centered on long-term growth in commercial end markets such as data centers and pharma; management said its products already fit those applications and that the company is expanding its architectural sales force and seeing more inquiries, though the commercial sales cycle is longer.