Insteel (IIIN) Q2 2026 Earnings Call Transcript

Motley Fool Transcribing, The Motley Fool

Thu, April 16, 2026 astatine 10:15 AM CDT 22 min read

Image source: The Motley Fool.

Thursday, April 16, 2026 astatine 10 a.m. ET

• President and Chief Executive Officer — H.O. Woltz III

• Senior Vice President, Chief Financial Officer and Treasurer — Scot R. Jafroodi

• Operator

Despite falling good abbreviated of our expected fiscal show successful Q2, we judge the upturn successful concern enactment we reported antecedently is inactive intact. Winter upwind is simply a information of beingness successful our business; it happens that during Q2, conditions were terrible and prolonged successful galore geographies, peculiarly compared to caller years. Project delays, portion undesirable, are communal successful the industry. We are assured that short-term upwind conditions and task delays bash not make oregon destruct demand, and that postponed request volition beryllium realized during the equilibrium of fiscal 2026. I volition present crook the telephone implicit to Scot to remark connected our fiscal results, and past pursuing his comments, I volition instrumentality to sermon our concern outlook.

Scot R. Jafroodi: Thank you, H. Good greeting to everyone joining america connected the call. As we reported earlier this morning, our 2nd 4th results were weaker than expected, reflecting the combined interaction of wintertime upwind disruptions, little spreads, and higher portion conversion costs. Net net for the 4th were $5.2 million, oregon $0.27 per diluted share, compared with $10.2 million, oregon $0.52 per diluted share, successful the aforesaid play past year. Shipments for the 4th declined 5.9% year-over-year but accrued 6.9% sequentially from the archetypal quarter. While the 2nd 4th typically reflects immoderate seasonal softness, conditions this twelvemonth were importantly much severe.

Following a coagulated commencement successful January, we experienced extended periods of wintertime upwind crossed astir of our markets, which reduced operation enactment and disrupted operating schedules for some customers and Insteel Industries, Inc., weighing connected bid travel and shipments. In addition, definite projects primitively scheduled for transportation during the 4th were deferred to aboriginal successful the twelvemonth for reasons unrelated to weather. Although we are inactive aboriginal successful the 3rd quarter, caller bid enactment has been solid, with April shipments trending supra forecasted levels. With that backdrop connected volumes, fto maine crook to pricing.

Average selling prices were up 14.2% year-over-year, driven by the pricing actions we enactment successful spot passim fiscal 2025 and into the existent twelvemonth to offset earthy worldly outgo increases, Section 232 tariffs, and rising operating expenses. Sequentially, mean selling prices were up 1% from the archetypal 4th adjacent arsenic ligament rod costs continued to determination higher. For context, published prices for alloy ligament rod, our superior earthy material, roseate $90 per ton during the quarter. Although we implemented further terms increases during Q2, constricted sequential betterment successful mean selling prices was influenced by merchandise mix, existing contractual pricing, and softer volumes.