- \n
- Separation from Fortive (NYSE: FTV) completed June 28, 2025<\/b><\/li>\n<\/ul>\n
- \n
- Revenue of $503 million, down 6% year-over-year and up 4% sequentially<\/b><\/li>\n<\/ul>\n
- \n
- Net Earnings of $47.6 with net earnings margin of 9.5%; adjusted EBITDA of $99 million with an adjusted EBITDA margin of 19.8%<\/b><\/li>\n<\/ul>\n
- \n
- Net Earnings per diluted share (EPS) of $0.42; adjusted EPS of $0.67<\/b><\/li>\n<\/ul>\n
- \n
- Launching Cost Savings Program; initially targeting $9 to $11 million in annualized savings to address spin-related Test & Measurement dis-synergies<\/b><\/li>\n<\/ul>\n
- \n
- Board authorized up to $200 million of share repurchases and approved quarterly dividend of $0.05 per share<\/b><\/li>\n<\/ul>\n
RALEIGH, N.C.–(BUSINESS WIRE<\/a>)–
\nRalliant Corporation (\u201cRalliant\u201d or the \u201cCompany\u201d) (NYSE: RAL) today announced financial results for the second quarter of 2025.<\/p>\n\nFor the second quarter, revenue of $503 million decreased 6% year-over-year for both total and organic revenue, in line with prior expectations. Sequentially, total revenue increased 4%.<\/p>\n
\nNet earnings were $48 million, and adjusted net earnings were $76 million, resulting in EPS of $0.42 and adjusted EPS of $0.67.<\/p>\n
\nNet earnings margin was 9.5%, a 260 basis point decline year-over-year and adjusted EBITDA margin was 19.8%, a 530 basis point decline year-over-year, driven by lower volume in Test & Measurement, higher salaries and wages, the ramp up of standalone public company costs, and tariffs.<\/p>\n
\nTami Newcombe, President and Chief Executive Officer, stated, \u201cAt the end of June we successfully completed our separation from Fortive, achieving an important milestone in Ralliant\u2019s journey. We continue to experience strong order demand in Sensors & Safety Systems as customers continue to invest in grid modernization and defense programs. Test & Measurement revenue remained down year-over-year but increased sequentially. We are launching a Cost Savings Program targeted at mitigating spin-related dis-synergies and contributing to adjusted EBITDA margin expansion, demonstrating our continued rigor in operating the business.\u201d<\/p>\n
\nMs. Newcombe continued, \u201cOur energized leadership team and high-performance culture connected by the Ralliant Business System are enabling us to navigate the dynamic economic environment while executing our growth strategy. We believe we are well positioned to continue to generate strong free cash flow and return to top-tier adjusted EBITDA growth as a more strategically focused business.\u201d<\/p>\n
Second Quarter 2025 Segment Highlights<\/b><\/p>\n
(All results compared with the second quarter of 2024 unless otherwise noted.)<\/i><\/p>\n
Sensors & Safety Systems (S&SS)<\/span><\/i><\/b><\/p>\n
Power grid monitoring solutions, defense and space technologies, industrial sensors for demanding environments<\/i><\/p>\n
- \n
- \nRevenue of $311 million, up 1% total, up 2% organic, up 6% sequentially<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nOperating profit of $80 million and operating profit margin of 25.6%, down 1% and 60 basis points, respectively<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nAdjusted EBITDA of $88 million and adjusted EBITDA margin of 28.4%, up 4% and 90 basis points, respectively<\/p>\n<\/li>\n<\/ul>\n
\nRobust demand in Utilities and Defense led to strong orders growth as customers continue to invest in grid modernization and defense programs. Revenue in the Industrial Manufacturing end market remained stable both year-over-year and sequentially.<\/p>\n
Test & Measurement (T&M)<\/span><\/i><\/b><\/p>\n
Precision instruments and essential software and services for advanced electronics<\/i><\/p>\n
- \n
- \nRevenue of $193 million, down 15% total, down 17% organic, up 2% sequentially<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nOperating loss of $(14) million and operating margin of (7.4)%, down 158% and 1,830 basis points, respectively<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nAdjusted EBITDA of $17 million and adjusted EBITDA margin of 9.1%, down 65% and 1,290 basis points, respectively<\/p>\n<\/li>\n<\/ul>\n
\nRevenue declines primarily related to a slowdown in Western Europe, which is heavily exposed to Automotive, and mainland China, consistent with the year-over-year trends in the first quarter. Revenue increased sequentially in Communications and stabilized in the Diversified Electronics and Semiconductor end markets. Operating margin and Adjusted EBITDA margin declines driven primarily by lower volume, additional employee costs, and tariffs. Operating margin was additionally impacted by the Fortive corporate cost allocations that were adjusted out on a non-GAAP basis. Adjusted EBITDA margin increased sequentially amid higher volume and cost actions, partially offset by tariffs.<\/p>\n
\nThe Company is launching a Cost Savings program, initially targeting $9-11 million of annualized cost savings focused on spin-related dis-synergies within the Test & Measurement segment, of which $4 million in annual run-rate savings is expected to be achieved by the fourth quarter of 2025. The Company anticipates these actions will contribute to adjusted EBITDA margin expansion for Test & Measurement starting in the third quarter of 2025.<\/p>\n
Balance Sheet and Cash Flow<\/b><\/p>\n
\nOn a reported basis, the Company generated $86 million of cash flow from operating activities and invested $12 million in capital expenditures, resulting in free cash flow of $74 million, compared with cash flow from operating activities of $96 million and free cash flow of $86 million in the second quarter of 2024.<\/p>\n
\nAt the end of the second quarter, the Company had $199 million of cash and equivalents and $1.15 billion of debt. The Company expects to pay approximately $90 million to Fortive or taxing authorities under spin-related agreements in the third quarter.<\/p>\n
\nOn June 28, 2025, the Board of Directors authorized up to $200 million of share repurchases and on August 6, 2025, declared a quarterly cash dividend of $0.05 per share of common stock.<\/p>\n
\nThe timing and amount of share repurchases will be determined by the Company based on its evaluation of market conditions and other factors. The share repurchase authorization has no expiration date, does not obligate the Company to acquire any particular amount of shares, and may be suspended or discontinued at any time.<\/p>\n
\nThe third quarter 2025 dividend is payable on September 23, 2025 to stockholders of record at the close of business on September 8, 2025.<\/p>\n
\nThe share repurchase authorization and dividend declaration demonstrate the Company\u2019s capacity and commitment to return capital to stockholders. The Company is focused on driving total shareholder returns through its capital allocation priorities outlined at its June 10, 2025 Investor Day. These include organic reinvestment, return of capital, and selective tuck-in acquisitions.<\/p>\n
OUTLOOK1<\/sup><\/b><\/p>\n
\nFor the remainder of the year, the Company plans to provide quarterly guidance. For the third quarter of 2025, Ralliant is providing the following outlook:<\/p>\n
- \n
- \nRevenue: $513 to $527 million<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nAdjusted EBITDA margin: 18% to 20%<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nAdjusted EPS: $0.54 to $0.60<\/p>\n<\/li>\n<\/ul>\n
Assumptions<\/span><\/i><\/p>\n
- \n
- \nStable adjusted EBITDA margin in Sensors & Safety Systems and double-digit adjusted EBITDA margin in Test & Measurement<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nTariff assumptions based on policy announcements as of August 8, 2025; expect to fully offset ongoing impact by the fourth quarter with continued gross margin impact of approximately 100 basis points<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nInterest expense of $16 to $18 million<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nAdjusted effective tax rate of 17% to 19%<\/p>\n<\/li>\n<\/ul>\n
- \n
- \nWeighted average diluted shares outstanding of approximately 113 million<\/p>\n<\/li>\n<\/ul>\n
- \nAdjusted effective tax rate of 17% to 19%<\/p>\n<\/li>\n<\/ul>\n
- \nInterest expense of $16 to $18 million<\/p>\n<\/li>\n<\/ul>\n
- \nTariff assumptions based on policy announcements as of August 8, 2025; expect to fully offset ongoing impact by the fourth quarter with continued gross margin impact of approximately 100 basis points<\/p>\n<\/li>\n<\/ul>\n
- \nStable adjusted EBITDA margin in Sensors & Safety Systems and double-digit adjusted EBITDA margin in Test & Measurement<\/p>\n<\/li>\n<\/ul>\n
- \nAdjusted EPS: $0.54 to $0.60<\/p>\n<\/li>\n<\/ul>\n
- \nAdjusted EBITDA margin: 18% to 20%<\/p>\n<\/li>\n<\/ul>\n
- \nRevenue: $513 to $527 million<\/p>\n<\/li>\n<\/ul>\n
- \nAdjusted EBITDA of $17 million and adjusted EBITDA margin of 9.1%, down 65% and 1,290 basis points, respectively<\/p>\n<\/li>\n<\/ul>\n
- \nOperating loss of $(14) million and operating margin of (7.4)%, down 158% and 1,830 basis points, respectively<\/p>\n<\/li>\n<\/ul>\n
- \nRevenue of $193 million, down 15% total, down 17% organic, up 2% sequentially<\/p>\n<\/li>\n<\/ul>\n
- \nAdjusted EBITDA of $88 million and adjusted EBITDA margin of 28.4%, up 4% and 90 basis points, respectively<\/p>\n<\/li>\n<\/ul>\n
- \nOperating profit of $80 million and operating profit margin of 25.6%, down 1% and 60 basis points, respectively<\/p>\n<\/li>\n<\/ul>\n
- \nRevenue of $311 million, up 1% total, up 2% organic, up 6% sequentially<\/p>\n<\/li>\n<\/ul>\n
- Board authorized up to $200 million of share repurchases and approved quarterly dividend of $0.05 per share<\/b><\/li>\n<\/ul>\n
- Launching Cost Savings Program; initially targeting $9 to $11 million in annualized savings to address spin-related Test & Measurement dis-synergies<\/b><\/li>\n<\/ul>\n
- Net Earnings per diluted share (EPS) of $0.42; adjusted EPS of $0.67<\/b><\/li>\n<\/ul>\n
- Net Earnings of $47.6 with net earnings margin of 9.5%; adjusted EBITDA of $99 million with an adjusted EBITDA margin of 19.8%<\/b><\/li>\n<\/ul>\n
- Revenue of $503 million, down 6% year-over-year and up 4% sequentially<\/b><\/li>\n<\/ul>\n