Argan, Inc. Reports Second Quarter Fiscal 2027 Results

Argan, Inc. Reports Second Quarter Fiscal 2027 Results ARLINGTON, Va.--( BUSINESS WIRE)--Argan, Inc. (NYSE: AGX) (“Argan” or the “Company”) today announces financial results for its second quarter of fiscal year 2027 ended July 31, 2026. The Company will host an investor conference call today, September 2, 2026, at 5:00 p.m. ET.

Consolidated Financial Highlights

($ in thousands, except per share data)

July 31,

For the Quarter Ended:

2026

2025

Change

Revenues

383,976

237,743

146,233

Gross profit

74,218

44,267

29,951

Gross margin %

19.3

18.6

0.7

Net income

53,302

35,275

18,027

Diluted earnings per share

3.76

2.50

1.26

Adjusted EBITDA (1)

70,030

38,490

31,540

Adjusted EBITDA margin (1)

18.2

16.2

2.0

Cash dividends per share

0.500

0.375

0.125

July 31,

For the Six Months Ended:

2026

2025

Change

Revenues

674,930

431,403

243,527

Gross profit

135,332

81,130

54,202

Gross margin %

20.1

18.8

1.3

Net income

99,365

57,825

41,540

Diluted earnings per share

7.01

4.09

2.92

Adjusted EBITDA (1)

126,469

69,977

56,492

Adjusted EBITDA margin (1)

18.7

16.2

2.5

Cash dividends per share

1.000

0.750

0.250

July 31,

January 31,

As of:

2026

Change

Cash, cash equivalents and investments

1,028,446

894,981

133,465

Net liquidity (2)

440,360

421,000

19,360

Share repurchase treasury stock, at cost

144,914

114,361

30,553

Project backlog

2,518,000

2,929,000

(411,000)

(1)

Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. Please refer to “Non-GAAP Financial Measures.”

(2)

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, “We delivered a strong second quarter, highlighted by record revenue of $384 million, a gross margin of 19.3%, record net income of $53 million, and record adjusted EBITDA of $70 million.

“Our Power segment continued to execute extremely well during the second quarter, growing revenue 53% year over year to $301 million at a gross margin of 22%. Following the close of the quarter, we achieved final completion on the remaining project of our Midwest Solar and Battery Projects. In our Industrial segment, construction of our new fabrication facility continues to progress as planned, with expected completion next quarter. The plant will support heightened demand for the fabrication of vessels for data centers. In our Teledata segment, we closed the acquisition of ValCor Communications, a Connecticut-based provider of installation and repair services for information, communication, and data networks. The addition of ValCor increases our geographic presence and expands the segment’s client base to defense, aerospace, and technology clients in the region.

“We are energized by the opportunities we are seeing across all three of our business segments and believe that our diverse capabilities, proven track record of excellent execution, and strong balance sheet position us well to benefit from the current demand environment. This is an exciting time for Argan and we remain focused on capturing the right projects with the right partners in the right geographies.”

Second Quarter Results

Consolidated revenues for the quarter ended July 31, 2026, were $384.0 million, an increase of $146.2 million, or 61.5%, from consolidated revenues of $237.7 million reported for the comparable prior-year quarter. The year-over-year increase reflects higher revenues across all of the Company’s business segments. In the Power segment, revenue growth was driven by the continued ramp-up of construction activities on several contracts that have not yet reached peak construction.

For the quarter ended July 31, 2026, Argan's consolidated gross profit was $74.2 million, or 19.3% of consolidated revenues, compared to $44.3 million, or 18.6% of consolidated revenues, for the quarter ended July 31, 2025. The gross profit percentage increased between periods primarily due to the changing mix of projects and contract types and strong execution in our Power segment. The increase in gross profit percentage was partially offset by decreased performance on certain projects in our Industrial and Teledata segments.

Selling, general and administrative expenses were $17.4 million and $14.2 million for the three months ended July 31, 2026 and 2025, respectively, and represented 4.5% and 6.0% of corresponding consolidated revenues, respectively.

Other income, net, for the three months ended July 31, 2026 was $10.1 million, which primarily reflected investment income earned during the period.

For the quarter ended July 31, 2026, Argan achieved net income of $53.3 million, or $3.76 per diluted share, compared to $35.3 million, or $2.50 per diluted share, for last year’s second quarter. EBITDA for the quarter ended July 31, 2026 increased to $67.6 million compared to $36.2 million for the same quarter of last year. Adjusted EBITDA for the quarter ended July 31, 2026 increased to $70.0 million compared to $38.5 million for the same quarter of last year.

Argan continues to generate significant cash flow and increased its total balance of cash, cash equivalents and investments during the quarter. The total balances were $1.03 billion and $895.0 million as of July 31, 2026 and January 31, 2026, respectively. Net liquidity was $440.4 million at July 31, 2026 and $421.0 million at January 31, 2026; furthermore, the Company had no debt.

First Six Months Results

Consolidated revenues for the six months ended July 31, 2026, were $674.9 million, an increase of $243.5 million, or 56.5%, from consolidated revenues of $431.4 million reported for the comparable prior-year period. For the six months ended July 31, 2026, consolidated gross profit increased to approximately $135.3 million, or 20.1% of consolidated revenues, compared to consolidated gross profit of $81.1 million, or 18.8% of consolidated revenues, reported for the six months ended July 31, 2025.

For the six months ended July 31, 2026, Argan achieved net income of $99.4 million, or $7.01 per diluted share, versus net income of $57.8 million, or $4.09 per diluted share, for last year’s comparable period. EBITDA for the six months ended July 31, 2026 increased to $122.0 million compared to $66.5 million in the same period of last year. Adjusted EBITDA for the six months ended July 31, 2026 increased to $126.5 million compared to $70.0 million for the same period of last year.

As of July 31, 2026, consolidated project backlog was approximately $2.5 billion, as compared to approximately $2.9 billion at January 31, 2026.

Conference Call and Webcast

Argan will host a conference call and webcast for investors today, September 2, 2026, at 5:00 p.m. ET.

Domestic stockholders and interested parties may participate in the conference call by dialing (888) 506-0062 and international participants should dial (973) 528-0011; all callers shall use access code: 327373.

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

https://www.webcaster5.com/Webcast/Page/2961/54404

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 September 16, 2026, and can be accessed by dialing 877-481-4010 (domestic) or 919-882-2331 (international). The replay access code is 54404. A replay of the webcast can be accessed until September 2, 2027.

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 teledata 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”), Adjusted EBITDA, and Adjusted EBITDA margin, each of which is a non-GAAP financial measure. The Company defines Adjusted EBITDA as EBITDA adjusted to exclude the impact of non-cash stock-based compensation expense. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by total revenues.

The Company believes these non-GAAP financial measures provide useful supplemental information to management and investors in evaluating the Company's operating performance because they exclude certain items that may not be indicative of the Company's core operating results or may affect comparability between periods or among companies with different capital structures, tax positions, depreciation policies, or equity compensation practices. Adjusted EBITDA and Adjusted EBITDA margin exclude stock-based compensation expense, a non-cash item that management believes impacts the comparability of operating results between reporting periods.

These non-GAAP financial measures should be considered in conjunction with, and not as substitutes for, the GAAP financial information presented in this press release. These measures have limitations as analytical tools because they exclude certain items, including interest, income tax expense, depreciation and amortization expense, and in the case of Adjusted EBITDA and Adjusted EBITDA margin, stock-based compensation expense. The methods used by the Company to calculate these non-GAAP financial measures may differ from methods used by other companies and, as a result, may not be comparable to similarly titled measures reported by other companies. Financial tables at the end of this press release provide reconciliations of these non-GAAP financial measures to the most directly 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)

(Unaudited)

Three Months Ended

Six Months Ended

July 31,

2026

2025

2026

2025

REVENUES

383,976

237,743

674,930

431,403

Cost of revenues

309,758

193,476

539,598

350,273

GROSS PROFIT

74,218

44,267

135,332

81,130

Selling, general and administrative expenses

17,413

14,212

33,132

26,733

INCOME FROM OPERATIONS

56,805

30,055

102,200

54,397

Other income, net

10,083

5,581

18,457

11,025

INCOME BEFORE INCOME TAXES

66,888

35,636

120,657

65,422

Provision for income taxes

13,586

361

21,292

7,597

NET INCOME

53,302

35,275

99,365

57,825

OTHER COMPREHENSIVE INCOME, NET OF TAXES

Foreign currency translation adjustments

(267)

(251)

(808)

3,370

Net unrealized (losses) gains on available-for-sale securities

(4,550)

(1,082)

(7,209)

1,598

COMPREHENSIVE INCOME

48,485

33,942

91,348

62,793

EARNINGS PER SHARE

Basic

3.80

2.57

7.10

4.23

Diluted

3.76

2.50

7.01

4.09

WEIGHTED AVERAGE SHARES OUTSTANDING

Basic

14,028

13,731

13,994

13,680

Diluted

14,164

14,131

14,181

14,122

CASH DIVIDENDS PER SHARE

0.500

0.375

1.000

0.750

Argan, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Dollars in thousands, except per share data)

(Unaudited)

July 31,

January 31,

2026

ASSETS

CURRENT ASSETS

Cash and cash equivalents

364,481

339,481

Investments

663,965

555,500

Accounts receivable, net

180,356

133,677

Contract assets

35,713

43,397

Other current assets

73,955

60,202

TOTAL CURRENT ASSETS

1,318,470

1,132,257

Property, plant and equipment, net

22,797

16,596

Goodwill

30,670

28,033

Intangible assets, net

6,030

1,450

Right-of-use and other assets

23,003

8,018

TOTAL ASSETS

1,400,970

1,186,354

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES

Accounts payable

115,212

107,540

Accrued expenses

135,878

89,748

Contract liabilities

627,020

513,969

TOTAL CURRENT LIABILITIES

878,110

711,257

Deferred taxes, net

3,061

6,555

Noncurrent liabilities

12,960

6,280

TOTAL LIABILITIES

894,131

724,092

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; 14,032,792 and 13,950,712 shares outstanding at July 31, 2026 and January 31, 2026, respectively

2,374

Additional paid-in capital

165,039

167,234

Retained earnings

491,539

406,197

Treasury stock, at cost – 1,795,497 and 1,877,577 shares at July 31, 2026 and January 31, 2026, respectively

(144,914)

(114,361)

Accumulated other comprehensive (loss) income

(7,199)

818

TOTAL STOCKHOLDERS’ EQUITY

506,839

462,262

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

1,400,970

1,186,354

Argan, Inc. and Subsidiaries

Adjusted EBITDA and Adjusted EBITDA Margin Reconciliations

(Dollars in thousands)

(Unaudited)

Three Months Ended

July 31,

2026

2025

Revenues

383,976

237,743

Net income, as reported

53,302

35,275

Provision for income taxes

13,586

361

Depreciation

645

491

Amortization of intangible assets

EBITDA

67,608

36,225

Stock-based compensation expense

2,422

2,265

Adjusted EBITDA

70,030

38,490

Adjusted EBITDA margin

18.2

16.2

Six Months Ended

July 31,

2026

2025

Revenues

674,930

431,403

Net income, as reported

99,365

57,825

Provision for income taxes

21,292

7,597

Depreciation

1,204

906

Amortization of intangible assets

150

196

EBITDA

122,011

66,524

Stock-based compensation expense

4,458

3,453

Adjusted EBITDA

126,469

69,977

Adjusted EBITDA margin

18.7

16.2