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What changed in POWELL INDUSTRIES INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of POWELL INDUSTRIES INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+203 added−165 removedSource: 10-K (2025-11-19) vs 10-K (2024-11-20)

Top changes in POWELL INDUSTRIES INC's 2025 10-K

203 paragraphs added · 165 removed · 147 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThe following table presents our revenue for each market sector by percentage of total revenue for the years ended September 30, 2024, 2023 and 2022: 2024 2023 2022 Oil and gas (excluding petrochemical) 41% 39% 40% Petrochemical 18% 13% 13% Electric utility 19% 23% 23% Commercial and other industrial 15% 15% 11% Light rail traction power 2% 4% 8% All others 5% 6% 5% Total 100% 100% 100% 5 In the oil and gas markets, we serve the upstream, midstream and downstream end markets, including onshore and offshore production, liquefied natural gas (LNG) facilities and terminals, pipelines and refineries.
Biggest changeWe strive to develop strong and lasting relationships with our customers and are recognized by many as a preferred service provider to solve our customers’ complex electrical distribution needs. 5 The following table presents our revenue for each market sector by percentage of total revenue for the years ended September 30, 2025, 2024 and 2023: 2025 2024 2023 Oil and gas (excludes petrochemical) 37% 41% 39% Electric utility 25% 19% 23% Commercial and other industrial 16% 15% 15% Petrochemical 14% 18% 13% Light rail traction power 4% 2% 4% All others 4% 5% 6% Total 100% 100% 100% In the oil and gas markets, we serve the upstream, midstream and downstream end markets, including onshore and offshore production, liquefied natural gas (LNG) facilities and terminals, pipelines and refineries.
Our principal services include field service inspection, installation, commissioning, modification and repair services. Products and services are principally sold directly to the end user or to an engineering, procurement and construction (EPC) firm on behalf of the end user. Each project is specifically engineered and manufactured to meet the exact specifications and requirements of the individual customer.
Our principal services include field service inspection, installation, commissioning, modification and repair services. 4 Products and services are principally sold directly to the end user or to an engineering, procurement and construction (EPC) firm on behalf of the end user. Each project is specifically engineered and manufactured to meet the exact specifications and requirements of the individual customer.
Typically, our contracts may have an early termination for convenience clause at the discretion of our customers; however, most of these contracts typically provide for the reimbursement of our costs incurred and a reasonable margin in the event of such early termination. Our methodology for determining backlog may not be comparable to the methodology used by other companies.
Typically, our contracts may have an early termination for convenience clause at the discretion of our customers; however, most of these contracts typically provide for the reimbursement of our costs incurred and 6 a reasonable margin in the event of such early termination. Our methodology for determining backlog may not be comparable to the methodology used by other companies.
In addition to the traditional crude oil refining and other oil and gas downstream processes, we have recently expanded our end markets into hydrogen production, carbon capture, as well as alternative fuels, such as biofuels and sustainable aviation fuel, in response to the demand for clean energy.
In addition to the traditional crude oil refining and other oil and gas downstream processes, we have expanded our end markets into hydrogen production, carbon capture, as well as alternative fuels, such as biofuels and sustainable aviation fuel, in response to the demand for clean energy.
We measure our success based on the percentage of internal promotions to key positions and our ability to attract and retain key employees. Seasonality Our operations are not generally affected by seasonality. However, weather and natural phenomena can temporarily impact the performance of our operations.
We measure our success based on the percentage of internal promotions to key positions and our ability to attract and retain key employees. 7 Seasonality Our operations are not generally affected by seasonality. However, weather and natural phenomena can temporarily impact the performance of our operations.
We have established a multi-faceted compliance program that includes educating employees and leadership, performing risk-based due diligence and evaluating our supplier base. We believe that the compliance cost associated with these governmental regulations will not have a material impact on our capital expenditures, results of operations or competitive position. 7
We have established a multi-faceted compliance program that includes educating employees and leadership, performing risk-based due diligence and evaluating our supplier and customer base. We believe that the compliance cost associated with these governmental regulations will not have a material impact on our capital expenditures, results of operations or competitive position.
Our major subsidiaries, all of which are wholly owned, include Powell Electrical Systems, Inc.; Powell Canada, Inc.; Powell (UK) Limited; and Powell Industries International, B.V. We are headquartered in Houston, Texas, and primarily serve the oil and gas and petrochemical markets, the electric utility market, and commercial and other industrial markets.
Our major subsidiaries, all of which are wholly owned, include Powell Electrical Systems, Inc.; Powell Canada, Inc.; Powell (UK) Limited; and Powell Industries International Limited. We are headquartered in Houston, Texas and primarily serve the oil and gas and petrochemical markets, the electric utility market, and commercial and other industrial markets.
We believe that the eight-year average tenure of our employees is a reflection of our inclusive and supportive culture, focused efforts on internal promotion, key employee retention and succession planning. Our annual Organizational Capabilities Review is focused on succession planning within our organization and is reviewed annually by our Board of Directors.
We believe that the seven-year average tenure of our employees is a reflection of our inclusive and supportive culture, and focused efforts on internal promotion, key employee retention and succession planning. Our annual Organizational Capabilities Review is focused on succession planning within our organization and is reviewed annually by our Board of Directors.
Additionally, all of our reports filed with the SEC are available via their website at sec.gov . References to Fiscal 2024, Fiscal 2023 and Fiscal 2022 used throughout this Annual Report relate to our fiscal years ended September 30, 2024, 2023 and 2022, respectively.
Additionally, all of our reports filed with the SEC are available via their website at sec.gov . References to Fiscal 2025, Fiscal 2024 and Fiscal 2023 used throughout this Annual Report relate to our fiscal years ended September 30, 2025, 2024 and 2023, respectively.
Our top human capital priorities include the well-being, health and safety, and retention of our employees, as well as enhanced learning and leadership training opportunities, workplace safety, internal promotion and key employee retention. We emphasize a culture of safety that runs throughout the Company.
Our top human capital priorities include the well-being, health and safety, and retention of our employees, as well as enhanced learning and leadership training opportunities, workplace safety, internal promotion and key employee retention. Powell emphasizes a culture of safety that runs throughout the Company.
Uncertainty and fluctuating global demand have led to significant volatility across commodity markets. We have experienced supply chain disruptions driven predominately by availability and cost volatility across our raw materials, engineered components and labor force. As our procurement function seeks to address specific supply chain challenges, we are working closely with our suppliers to meet our customer commitments.
We have occasionally experienced supply chain disruptions driven predominately by availability and cost volatility across our raw materials, engineered components and labor force. As our procurement function seeks to address specific supply chain challenges, we are working closely with our suppliers to meet our customer commitments.
Our backlog at September 30, 2024 was $1.3 billion. We anticipate that approximately $849 million of Fiscal 2024 ending backlog will be recognized as revenue during our fiscal year ending September 30, 2025.
Our backlog at September 30, 2025 was $1.4 billion. We anticipate that approximately $824 million of Fiscal 2025 ending backlog will be recognized as revenue during our fiscal year ending September 30, 2026.
Human Capital At September 30, 2024, we had 2,748 full-time employees and 439 contract employees located primarily in the United States, Canada and the United Kingdom (U.K.). Our employees are not represented by unions, and we maintain good relationships with our employees.
Human Capital At September 30, 2025, we had 3,143 full-time employees and 315 contract employees located primarily in the United States, Canada and the United Kingdom (U.K.). Our employees are not represented by unions, and we believe that our relationship with our employees is good.
Research, Development and Intellectual Property Research and development activities are critical to Powell’s sustained growth and are focused on both the development of new products and applications and enhancement of our existing product offerings.
In both Fiscal 2025 and Fiscal 2024, no single customer accounted for more than 10% of our consolidated revenues. Research, Development and Intellectual Property Research and development activities are critical to Powell’s sustained growth and are focused on both the development of new products and applications and enhancement of our existing product offerings.
We establish annual goals and monthly operating metrics and, as a result, had a safety incident rate of 0.74 for Fiscal Year 2024, which is below the industry average, according to the U.S. Bureau of Labor Statistics.
We establish annual safety goals and monthly operating metrics which have resulted in a safety emergency modification rating (EMR) 0.80, which is below the industry average of 1.0, according to the U.S. Bureau of Labor Statistics.
Additionally, we may acquire from time to time intellectual property to expand our product offering and application. For example, in December 2023, we acquired intellectual property for a total consideration of $0.5 million.
Additionally, we may acquire from time to time intellectual property to expand our product offering and application. For example, in August 2025, we acquired Remsdaq, which included an acquisition of technology of approximately $3 million.
If during that time the customer were to experience financial distress, a decline in business or circumstances that would otherwise necessitate a cancellation of a project with us, our revenue could be adversely impacted. In both Fiscal 2024 and Fiscal 2023, no single customer accounted for more than 10% of our consolidated revenues.
From time to time, an individual manufacturing facility may have significant volume from one particular customer that would be material to that facility. If during that time the customer were to experience financial distress, a decline in business or circumstances that would otherwise necessitate a cancellation of a project with us, our revenue could be adversely impacted.
Contracts often represent large-scale and complex projects with an individual customer. By their nature, these projects are typically non-recurring. Thus, multiple or continuous projects of similar magnitude with the same customer are not predictable. The timing of large project awards may cause material fluctuations in our revenues and gross profits.
Due to the nature and timing of large projects, a large percentage of our revenues in a given period may result from a few specific contracts or customers. Contracts often represent large-scale and complex projects with an individual customer. By their nature, these projects are typically non-recurring.
Unanticipated changes in material requirements, market conditions and disruptions in the supply chain or price increases could impact production costs and affect our consolidated results of operations. 6 The equipment and materials that we use in our business are subject to availability and price fluctuations due to customer demand, producer capacity and market conditions.
Material costs represented 45% of revenues in Fiscal 2025, 47% of revenues in Fiscal 2024, and 49% of revenues in Fiscal 2023. Unanticipated changes in material requirements, market conditions and disruptions in the supply chain or price increases could impact production costs and affect our consolidated results of operations.
We seek to establish long-term relationships with the end users of our systems as well as EPC firms contracted by those end users.
We seek to establish long-term relationships with the end users of our systems as well as EPC firms contracted by those end users. We believe that fostering a culture of safety and focusing on customer satisfaction, along with our strong balance sheet, allow us to capitalize on opportunities in the industries we serve.
We consider our engineering, project management, systems integration and technical support capabilities vital to the success of our business. We strive to develop strong and lasting relationships with our customers and are recognized by many as a preferred service provider to solve our customers’ complex electrical distribution needs.
We consider our engineering, project management, systems integration and technical support capabilities vital to the success of our business.
Additionally, the reduction in business volume from a particular industry or the loss of a major customer could have an adverse effect on our business. From time to time, an individual manufacturing facility may have significant volume from one particular customer that would be material to that facility.
Thus, multiple or continuous projects of similar magnitude with the same customer are not predictable. The timing of large project awards may cause material fluctuations in our revenues and gross profits. Additionally, the reduction in business volume from a particular industry or the loss of a major customer could have an adverse effect on our business.
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We believe that fostering a culture of safety and focusing on customer satisfaction, along with our strong balance sheet, allows us to capitalize on opportunities in the industries we serve. 4 Due to the nature and timing of large projects, a significant percentage of our revenues in a given period may result from one specific contract or customer.
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Recent Developments Business Acquisition On August 15, 2025, we completed the previously announced business acquisition of Remsdaq Limited (Remsdaq), a U.K.-based manufacturer of Supervisory Control and Data Acquisition (SCADA) Remote Terminal Units (RTUs) for electrical substation control and automation in generation, transmission and distribution, for a total consideration of £13.6 million Pounds Sterling, or $18.4 million, including cash acquired.
Removed
Material costs represented 47% of revenues in Fiscal 2024, 49% of revenues in Fiscal 2023, and 51% of revenues in Fiscal 2022.
Added
See Note P. Business Acquisition of the Notes to Consolidated Financial Statements for additional information. Houston Electrical Products Manufacturing Facility Expansion In Fiscal 2025, we completed the expansion and improvement project at our electrical products facility in Houston, Texas, and the incremental capacity has been placed into service.
Added
Production Capacity Expansion at Jacintoport Manufacturing Facility In August 2025, we announced a $12.4 million investment to expand production capacity at our Jacintoport manufacturing facility in Houston, Texas. The investment will add an incremental 335,000 square feet of productive capacity for Power Control Room laydown area, a 62% increase from the current yard capacity.
Added
The investment will also double the length of the existing shoreline bulkhead to 1,150 feet to support increased schedule flexibility and multiple ship lanes for the varied needs and project timelines of our customers. The incremental capacity is initially expected to support the Company’s oil and gas customers but can be utilized to support each of our market sectors.
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Construction is expected to begin during the first quarter of Fiscal 2026 and is expected to be completed in the second half of Fiscal 2026.
Added
The equipment and materials that we use in our business are subject to availability and price fluctuations due to customer demand, producer capacity and market conditions. Uncertainty and fluctuating global demand have led to significant volatility across commodity markets.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

51 edited+24 added−5 removed129 unchanged
Biggest changeThese disruptions could lead to reduced demand for our products and services and cancellation of existing projects, and could have an adverse impact on our business, financial condition and results of operations. 11 Fluctuations in the price and supply of materials used to manufacture our products may reduce our profits and could adversely impact our ability to meet commitments to our customers.
Biggest changeFluctuations in the price and supply of materials used to manufacture our products may reduce our profits and could adversely impact our ability to meet commitments to our customers. Our material costs equaled approximately 45% of our consolidated revenues for Fiscal 2025.
Each individual contract seeks to define the conditions under which the customer may make a claim against us. Due to the growth in our backlog, our manufacturing and fabrication capacity as well as ability to recruit and retain qualified labor is challenged resulting in an increased risk of meeting delivery dates and other contract performance obligations.
Each individual contract seeks to define the conditions under which the customer may make a claim against us. Due to the growth in our backlog, our manufacturing and fabrication capacity as well as our ability to recruit and retain qualified labor is challenged resulting in an increased risk of meeting delivery dates and other contract performance obligations.
Among other things, the occurrence of an event of default could limit our ability to pay dividends, issue letters of credit, or obtain additional financing or result in acceleration of outstanding amounts under the credit agreement or a termination of the agreement, any of which could have an adverse impact on our liquidity, business and results of operations.
Among other things, the occurrence of an event of default could limit our ability to pay dividends, issue letters of credit, obtain additional financing or result in acceleration of outstanding amounts under the credit agreement or a termination of the agreement, any of which could have an adverse impact on our liquidity, business and results of operations.
It is possible that adjustments arising from such claims, or our failure to manage our contract risk, may not be covered by insurance and could have an adverse impact on our results of operations. 10 Growth and product diversification through strategic acquisitions involve a number of risks.
It is possible that adjustments arising from such claims, or our failure to manage our contract risk, may not be covered by insurance and could have an adverse impact on our results of operations. Growth and product diversification through strategic acquisitions involve a number of risks.
For example, several jurisdictions have implemented or are expected to implement in the future, the Organization for Economic Co-operation and Development Pillar 2, which is aimed at preventing base erosion and profit shifting, ensuring income is subject to a minimum level of taxation and preventing treaty misuse.
For example, several jurisdictions have implemented or are expected to implement in the future, the Organization for Economic Co-operation and Development Pillar 16 2, which is aimed at preventing base erosion and profit shifting, ensuring income is subject to a minimum level of taxation and preventing treaty misuse.
Similarly, the repurchase or redemption rights or liquidation preferences we might assign to holders of preferred stock could affect the residual value of the common stock. Risk Factors Related to Legal and Regulatory Matters Our operations could be adversely impacted by the effects of government regulations.
Similarly, the repurchase or redemption rights or liquidation preferences we might assign to holders of preferred stock could affect the residual value of the common stock. 15 Risk Factors Related to Legal and Regulatory Matters Our operations could be adversely impacted by the effects of government regulations.
This, in turn, could adversely impact the demand for the products produced by our customers and, therefore, reduce demand for our products, which could adversely impact our business and results of operations. 18 The departure of key personnel could disrupt our business. We depend on the continued efforts of our executive officers, senior management and other key personnel.
This, in turn, could adversely impact the demand for the products produced by our customers and, therefore, reduce demand for our products, which could adversely impact our business and results of operations. The departure of key personnel could disrupt our business. We depend on the continued efforts of our executive officers, senior management and other key personnel.
The Dodd-Frank Wall Street Reform and Consumer Protection Act requires disclosure of use of "conflict" minerals mined from the Democratic Republic of Congo and adjoining countries and our efforts to prevent the use of such minerals. In our industry, conflict minerals are most commonly found in metals.
The Dodd-Frank Wall Street Reform and Consumer Protection Act requires disclosure of use of “conflict” minerals mined from the Democratic Republic of Congo and adjoining countries and our efforts to prevent the use of such minerals. In our industry, conflict minerals are most commonly found in metals.
Labor shortages or increased labor costs could impair our ability to maintain our business, meet customer commitments or grow our revenues, and could adversely impact our business and results of operations. Revenues recognized over time from our fixed-price contracts could result in volatility in our results of operations.
Labor shortages or increased labor costs could impair our ability to maintain our business, meet customer commitments or grow our revenues, and could adversely impact our business and results of operations. 9 Revenues recognized over time from our fixed-price contracts could result in volatility in our results of operations.
Although we seek to obtain indemnities against liabilities relating to historical contamination at the facilities we own or operate, we cannot provide any assurance that we will not incur liabilities relating to the remediation of potential contamination, including contamination we did not cause.
Although we seek to obtain indemnities against liabilities relating to historical contamination at the facilities we own or operate, we cannot provide any assurance that we will not incur liabilities relating to the remediation of 19 potential contamination, including contamination we did not cause.
Such failure could result in additional changes to our revenue and cost estimates which could have an adverse impact on our results of operations. 9 We are exposed to risks relating to the use of subcontractors.
Such failure could result in additional changes to our revenue and cost estimates which could have an adverse impact on our results of operations. We are exposed to risks relating to the use of subcontractors.
A reduction in or elimination of our dividend payments could have a material negative effect on our stock price. 13 We may issue preferred stock on terms that could adversely affect the voting power or value of our common stock.
A reduction in or elimination of our dividend payments could have a material negative effect on our stock price. We may issue preferred stock on terms that could adversely affect the voting power or value of our common stock.
We cannot be certain that any individual will continue in such capacity for any particular period of time. The loss of key personnel, or the inability to hire, train and retain qualified employees, could negatively impact our ability to perform and manage our business. 19 Item 1B. Unresolved Staff Comments None.
We cannot be certain that any individual will continue in such capacity for any particular period of time. The loss of key personnel, or the inability to hire, train and retain qualified employees, could negatively impact our ability to perform and manage our business. 20 Item 1B. Unresolved Staff Comments None.
Our competitors may develop products or production methods that are superior in price or quality, or incorporate artificial intelligence (AI) into their products that will make current products or services offered by us obsolete.
Our competitors may develop products or production methods that are superior in price or quality, or incorporate AI into their products that will make current products or services offered by us obsolete.
Our international operations expose us to risks that are different from, or possibly greater than, the risks we are exposed to domestically and may adversely affect our operations. Revenues associated with projects located outside of the United States, including revenues generated from our operations in the U.K. and Canada, accounted for approximately 16% of our consolidated revenues in Fiscal 2024.
Our international operations expose us to risks that are different from, or possibly greater than, the risks we are exposed to domestically and may adversely affect our operations. Revenues associated with projects located outside of the United States, including revenues generated from our operations in the U.K. and Canada, accounted for approximately 20% of our consolidated revenues in Fiscal 2025.
Also, we may face challenges with our customers and suppliers if we are unable to sufficiently verify that the metals used in our products are "conflict-free." 14 Actual and potential claims, lawsuits and proceedings could ultimately reduce our profitability and liquidity and weaken our financial condition. We are currently involved or may be involved in legal, regulatory and other proceedings.
Also, we may face challenges with our customers and suppliers if we are unable to sufficiently verify that the metals used in our products are “conflict-free.” Actual and potential claims, lawsuits and proceedings could ultimately reduce our profitability and liquidity and weaken our financial condition. We are currently involved or may be involved in legal, regulatory and other proceedings.
Changes in and compliance with ESG initiatives could adversely impact our business. There has been an increased focus on ESG matters by consumers, investors, as well as by governmental and non-governmental organizations. For example, organizations that provide ESG information to investors have developed ratings processes for evaluating a business entity’s approach to ESG matters.
Changes in and compliance with ESG initiatives could adversely impact our business. ESG matters have been a focus for consumers, investors, as well as by governmental and non-governmental organizations. For example, organizations that provide ESG information to investors have developed ratings processes for evaluating a business entity’s approach to ESG matters.
Factors that could impact our ability to adequately project costs for our bids include, but are not limited to: the impacts of inflation; labor shortage; delays incurred by the failure of third-party suppliers to deliver in the quality or quantity required; unanticipated technical problems, including design or engineering issues.
Factors that could impact our ability to adequately project costs for our bids include, but are not limited to: the impacts of inflation; labor shortage; the cost of raw materials; increases caused by tariffs; delays incurred by the failure of third-party suppliers to deliver in the quality or quantity required; unanticipated technical problems, including design or engineering issues.
As there may be only a limited number of suppliers offering "conflict-free" metals, we cannot be sure that we will be able to obtain necessary metals in sufficient quantities or at competitive prices.
As there may be only a limited number of suppliers offering “conflict-free” metals, we cannot be sure that we will be able to obtain necessary metals in sufficient quantities or at competitive prices.
In the event that one of our products fails to meet our customers' standards or safety requirements or fails to operate effectively, our reputation could be harmed, which would adversely affect our marketing and sales efforts.
In the event that our products fail to meet our customers’ standards or safety requirements or fail to operate effectively, our reputation could be harmed, which would adversely affect our marketing and sales efforts.
Technological innovations may make existing products and production methods obsolete. All of the products that we manufacture and sell depend upon optimizing available technology for success in the marketplace. The industries in which we operate are characterized by intense competition and are highly sensitive to technological innovation and customer requirements.
All of the products that we manufacture and sell depend upon optimizing available technology for success in the marketplace. The industries in which we operate are characterized by intense competition and are highly sensitive to technological innovation and customer requirements.
The restriction, reduction or termination of our surety bond agreements could limit our ability to bid on new opportunities and would require us to issue letters of credit under our bank facilities in lieu of surety bonds, thereby reducing availability under our credit facility, which could have an adverse impact on our liquidity, business and results of operations.
The restriction, reduction or termination of our surety bond agreements could limit our ability to bid on new opportunities and would require us to issue letters of credit under our bank facilities in lieu of surety bonds, thereby reducing availability under our credit facility, which could have an adverse impact on our liquidity, business and results of operations. 12 Failure to remain in compliance with covenants or obtain waivers or amendments under our credit agreement could adversely impact our business.
If we are unable to sufficiently protect our patent and other proprietary rights or if we infringe on or misappropriate proprietary rights of others, our business, financial condition, results of operations, and cash flows could be adversely impacted.
If we are unable to sufficiently protect our patent and other proprietary rights or if we infringe on or misappropriate proprietary rights of others, our business, financial condition, results of operations, and cash flows could be adversely impacted. Significant developments arising from tariffs and other economic proposals could adversely impact our business.
Significant developments arising from tariffs and other economic proposals could adversely impact our business. Additional restrictions or economic disincentives on United States or international trade such as significant increases in tariffs on goods could adversely impact our business.
Additional restrictions or economic disincentives on United States or international trade such as significant increases in tariffs on goods could adversely impact our business.
To the extent we do assert our intellectual property rights against third parties, we may not be successful and adequate remedies may not be available in the event of infringement or unauthorized use of our intellectual property rights, or disclosure of our trade secrets. 15 Third parties may in the future assert that we have infringed, misappropriated, or otherwise violated their intellectual property rights.
To the extent we do assert our intellectual property rights against third parties, we may not be successful and adequate remedies may not be available in the event of infringement or unauthorized use of our intellectual property rights, or disclosure of our trade secrets.
If we are unable to collect amounts owed to us, or retain amounts paid to us, our cash flows would be adversely impacted, and we could experience losses if those amounts exceed current allowances.
If we are unable to collect amounts owed to us, or retain amounts paid to us, our cash flows would be adversely impacted, and we could experience losses if those amounts exceed current allowances. Any of these factors could adversely impact our business and results of operations.
Various factors drive demand for our products and services, including the price and demand for oil and gas, capital expenditures, economic forecasts, global political environments (including war and terrorism) and the cost of capital.
Various factors drive demand for our products and services, including the price and demand for oil, gas and electrical energy, capital expenditures, economic forecasts, global political environments (including war and terrorism), anticipated environmental, safety or regulatory changes and the cost of capital.
Unforeseen difficulties with expansions, relocations, or consolidations of existing facilities could adversely affect our operations. From time to time, we may decide to enter new markets, build or lease additional facilities, expand our existing facilities, relocate or consolidate one or more of our operations or exit a facility we may own or lease.
From time to time, we may decide to enter new markets, build or lease additional facilities, expand our existing facilities, relocate or consolidate one or more of our operations or exit a facility we may own or lease.
Provisions of our charter documents or Delaware law could delay or prevent a change in control of our company, even if that change would be beneficial to our shareholders.
Risk Factors Related to our Corporate Structure and our Common Stock Provisions of our charter documents or Delaware law could delay or prevent a change in control of our company, even if that change would be beneficial to our shareholders.
Acquisitions involve certain risks, including distraction of management, difficulties in the integration of operations and systems; failure to realize cost savings; the termination of relationships by key personnel and customers of the acquired company and a failure to retain or add additional employees to handle the increased volume of business.
Acquisitions involve certain risks, including distraction of management, possible disruption to ongoing business, difficulties in the integration of operations and systems, failure to realize cost savings and achieve anticipated synergies, complications arising from merging differing cultures, systems, or technologies, the termination of relationships by key personnel and customers of the acquired company and a failure to retain or add additional employees to handle the increased volume of business.
Our customer projects, budgets for capital expenditures and the need for our services have in the past, and may in the future, be adversely affected by, among other things, the price of oil and gas, poor economic conditions, commodity prices, political uncertainties, cost of capital, and currency fluctuations.
Our customer projects, budgets for capital expenditures and the need for our services have in the past, and may in the future, be adversely affected by, among other things, the demand and price for oil, gas and electrical energy, the overall economic and financial environment, governmental budgets, commodity prices, political uncertainties, cost of capital, currency fluctuations, regulatory actions and environmental concerns.
Changes in United States or international social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently develop and sell our products, and any negative sentiment towards the United States as a result of such changes, could adversely impact our business and results of operations.
Changes in United States or international social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently develop and sell our products, and any negative sentiment towards the United States as a result of such changes, could adversely impact our business and results of operations. 17 Failures or weaknesses in our internal controls over financial reporting could adversely affect our ability to report on our financial condition and results of operations accurately or on a timely basis.
We may be unable to recover certain costs on our anticipated margin, and cancelled or suspended projects may also result in additional unrecoverable costs due to the underutilization of our assets and personnel.
We may be unable to recover certain costs on our anticipated margin, and cancelled or suspended projects may also result in additional unrecoverable costs due to the underutilization of our assets and personnel. Accordingly, our inability to realize the full amount of our contract backlog may have an adverse impact on our business and results of operations.
Our failure to maintain effective internal controls over financial reporting could adversely affect our ability to report our financial results on a timely and accurate basis, which could result in a loss of investor confidence in our financial reports or a decline in our stock price, or have an adverse impact on our business and results of operations. 16 General Risk Factors We carry insurance against many potential liabilities, but our management of risk may leave us exposed to unidentified or unanticipated risks.
Our failure to maintain effective internal controls over financial reporting could adversely affect our ability to report our financial results on a timely and accurate basis, which could result in a loss of investor confidence in our financial reports or a decline in our stock price, or have an adverse impact on our business and results of operations.
We cannot assure that our current or future technologies are not infringing or violating intellectual property rights of third parties. In the event we face claims of infringement or misappropriation, we may face expensive litigation or indemnification obligations, be required to enter into licenses, and may be prevented from selling existing products and pursuing product development or commercialization.
In the event we face claims of infringement or misappropriation, we may face expensive litigation or indemnification obligations, be required to enter into licenses, and may be prevented from selling existing products and pursuing product development or commercialization.
Acts of misconduct, or our failure to comply with applicable laws or regulations, could subject us to fines and penalties, harm our reputation, or damage our relationships with customers and could adversely impact our business and results of operations.
Acts of misconduct, or our failure to comply with applicable laws or regulations, could subject us to fines and penalties, harm our reputation, or damage our relationships with customers and could adversely impact our business and results of operations. 11 Unsatisfactory safety performance may subject us to penalties, negatively impact customer relationships, result in higher operating costs, and negatively impact employee morale and turnover.
Although we maintain insurance policies with respect to our estimated exposures, including certain casualty, property, professional, employee liability, business interruption, cybersecurity and self-insured medical programs, these policies contain deductibles, self-insured retentions and limits of coverage.
General Risk Factors We carry insurance against many potential liabilities, but our management of risk may leave us exposed to unidentified or unanticipated risks. Although we maintain insurance policies with respect to our estimated exposures, including certain casualty, property, professional, employee liability, business interruption, cybersecurity and self-insured medical programs, these policies contain deductibles, self-insured retentions and limits of coverage.
If we fail to remain in compliance with such covenants and restrictions, absent an amendment or waiver, this could result in an event of default under the credit agreement.
Our ability to remain in compliance with such financial covenants and restrictions may be affected by factors beyond our control, including general or industry-specific economic downturns. If we fail to remain in compliance with such covenants and restrictions, absent an amendment or waiver, this could result in an event of default under the credit agreement.
Unsatisfactory safety performance may subject us to penalties, negatively impact customer relationships, result in higher operating costs, and negatively impact employee morale and turnover. We have both indoor and outdoor manufacturing and fabrication facilities that are susceptible to numerous industrial safety risks that can lead to personal injury, loss of life, damage to property or equipment, and potential environmental damage.
We have both indoor and outdoor manufacturing and fabrication facilities that are susceptible to numerous industrial safety risks that can lead to personal injury, loss of life, damage to property or equipment, and potential environmental damage.
While we attempt to mitigate these risks by employing a number of measures, including employee education, comprehensive monitoring of our networks and systems, and maintenance of backup and protective systems, our systems, networks and products remain potentially vulnerable to advanced persistent threats.
Increased global information technology cybersecurity threats and more sophisticated and targeted computer crime pose a risk to the security of our systems and networks, and the confidentiality, availability and integrity of our data and communications. 18 While we attempt to mitigate these risks by employing a number of measures, including employee education, comprehensive monitoring of our networks and systems, and maintenance of backup and protective systems, our systems, networks and products remain potentially vulnerable to advanced persistent threats.
We could lose potential projects and existing customers, our ability to operate our business could be impaired, we may incur significant liabilities, we could suffer harm to our reputation and competitive position, and our operating results could be negatively impacted. 17 Our insurance coverage may not be sufficient to compensate for all liability relating to any actual or potential disruption or other security breach or incident.
We could lose potential projects and existing customers, our ability to operate our business could be impaired, we may incur significant liabilities, we could suffer harm to our reputation and competitive position, and our operating results could be negatively impacted.
Accordingly, our inability to realize the full amount of our contract backlog may have an adverse impact on our business and results of operations. 8 Failure to place competitive bids and adequately project costs may result in losses on our fixed-price contracts with customers. Our products and services are typically awarded in competitive bid situations.
Failure to place competitive bids and adequately project future costs may result in losses on our fixed-price contracts with customers. Our products and services are typically awarded in competitive bid situations.
Due to the nature and timing of large projects, a significant percentage of our revenues in a given period may result from one specific contract, customer or industry. For instance, we have a significant concentration of customers in the oil and gas, petrochemical and electric utility industries.
A significant portion of our revenues may be concentrated among a small number of customers and may be subject to the risks of particular industries. Due to the nature and timing of large projects, a significant percentage of our revenues in a given period may result from one specific contract, customer or industry.
Our backlog is subject to unexpected adjustments, cancellations and scope reductions and, therefore, may not be a reliable indicator of our future earnings. We have a backlog of uncompleted contracts.
Our failure to compete effectively and secure projects could adversely affect future revenues and could have an adverse impact on our business and results of operations. 8 Our backlog is subject to unexpected adjustments, cancellations and scope reductions and, therefore, may not be a reliable indicator of our future earnings. We have a backlog of uncompleted contracts.
Additionally, from time to time, one of our manufacturing facilities may have significant volume from one particular customer or industry that would be material to that facility.
For instance, we have a significant concentration of customers in the oil and gas, petrochemical and electric utility industries. Additionally, from time to time, one of our manufacturing facilities may have significant volume from one particular customer or industry that would be material to that facility.
Similarly, disruptions in the capital markets or increased interest rates may also adversely impact our customer's ability to finance projects, which could result in contract cancellations or delays.
Similarly, disruptions in the capital markets or increased interest rates may also adversely impact our customer’s ability to finance projects, which could result in contract cancellations or delays. These disruptions could lead to reduced demand for our products and services and cancellation of existing projects, and could have an adverse impact on our business, financial condition and results of operations.
Accordingly, our financial performance is subject to fluctuations due to changes in foreign currency exchange rates relative to the U.S. dollar, and such fluctuations could adversely impact our financial position and results of operations. Risk Factors Related to our Common Stock Our stock price could decline or fluctuate significantly due to unforeseen circumstances that may be outside of our control.
Accordingly, our financial performance is subject to fluctuations due to changes in foreign currency exchange rates relative to the U.S. dollar, and such fluctuations could adversely impact our financial position and results of operations. 13 Our ability to access credit and capital markets may be limited, which could adversely affect our liquidity, operations, and growth strategy.
The application of these provisions is not always certain, and jurisdictions are still developing their rules and interpretations with regard to the same.
The application of these provisions is not always certain, and jurisdictions are still developing their rules and interpretations with regard to the same. The One Big Beautiful Bill Act (the OBBBA) was recently signed into law and includes a broad range of tax reform provisions affecting businesses.
Failure to remain in compliance with covenants or obtain waivers or amendments under our credit agreement could adversely impact our business. Our credit agreement contains various financial covenants and restrictions, which includes maintaining a consolidated net leverage ratio of less than 3.0 to 1.0 and a consolidated interest coverage ratio of greater than 3.0 to 1.0.
Our credit agreement contains various financial covenants and restrictions, which includes maintaining a consolidated net leverage ratio of less than 3.0 to 1.0 and a consolidated interest coverage ratio of greater than 3.0 to 1.0. For more information on our credit agreement and the restrictions thereunder, see Note G. Long-Term Debt of the Notes to Consolidated Financial Statements.
New companies may enter the markets in which we compete, or industry consolidation may occur, further increasing competition in our markets. Our failure to compete effectively and secure projects could adversely affect future revenues and could have an adverse impact on our business and results of operations.
New companies may enter the markets in which we compete, or industry consolidation may occur, further increasing competition in our markets.
These fluctuations may cause our stockholders to incur losses.
Our stock price could decline or fluctuate significantly due to unforeseen circumstances that may be outside of our control. These fluctuations may cause our stockholders to incur losses.
Removed
Our material costs equaled approximately 47% of our consolidated revenues for Fiscal 2024.
Added
Cyclicality is predominately driven by customer demand, global economic and geopolitical conditions and anticipated environmental, safety or regulatory changes that affect the manner in which our customers proceed with capital investments.
Removed
For more information on our credit agreement and the restrictions thereunder, see Note G of the Notes to Consolidated Financial Statements. Our ability to remain in compliance with such financial covenants and restrictions may be affected by factors beyond our control, including general or industry-specific economic downturns.
Added
Technological innovations may make existing products and production methods obsolete. The development or use of Artificial Intelligence (AI) by our competitors or other third parties may impair our ability to compete effectively and adversely affect our business, financial condition and results of operations.
Removed
Any of these factors could adversely impact our business and results of operations. 12 A significant portion of our revenues may be concentrated among a small number of customers and may be subject to the risks of particular industries.
Added
Our competitors or other third parties may incorporate AI, including machine learning, data science and similar technologies, into their product development, product enhancement or product offerings more quickly or more successfully than us, which could impair our ability to compete effectively and adversely affect our business, financial condition and results of operations.
Removed
Failures or weaknesses in our internal controls over financial reporting could adversely affect our ability to report on our financial condition and results of operations accurately or on a timely basis.
Added
The complex and rapidly evolving landscape around AI could expose us to claims, inquiries and proceedings by third parties and global regulatory authorities and subject us to legal liability as well as reputational harm. 10 Unforeseen difficulties with expansions, relocations, or consolidations of existing facilities could adversely affect our operations.
Removed
Increased global information technology cybersecurity threats and more sophisticated and targeted computer crime pose a risk to the security of our systems and networks, and the confidentiality, availability and integrity of our data and communications.
Added
We may be unable to obtain financing when needed or on favorable terms, particularly during periods of market volatility or reduced liquidity. Unstable market conditions, changes in our financial performance, or factors affecting our industry could increase borrowing costs or restrict access to debt and equity financing.
Added
In addition, fluctuations in our common stock price, driven by market conditions or events beyond our control, could limit our ability to raise funds through equity markets.
Added
The personal liability of our directors and officers for monetary damages for breach of their fiduciary duty of care is limited by the Delaware General Corporation Law and by our certificate of incorporation.
Added
The Delaware General Corporation Law allows corporations to limit available relief for the breach of directors’ or officers’ duty of care to equitable remedies such as injunction or rescission. Our certificate of incorporation limits the liability of our directors and officers to the fullest extent permitted by Delaware law.
Added
Specifically, our directors and officers will not be personally liable for monetary damages for any breach of their fiduciary duty, except for liability: • for any breach of their duty of loyalty to the Company or our stockholders; • for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law; • for any transaction from which the director or officer derived an improper personal benefit; • solely with respect to directors, under provisions relating to unlawful payments of dividends or unlawful stock repurchases or redemptions; and • solely with respect to officers, for any action by or in the right of the Company.
Added
This limitation may have the effect of reducing the likelihood of derivative litigation against directors or officers and may discourage or deter stockholders (or, with respect to directors, management) from bringing a lawsuit against directors or officers, as applicable, for breach of their duty of care, even though such an action, if successful, might otherwise have benefited our stockholders.
Added
The exclusive-forum provision contained in our bylaws could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees.
Added
Our bylaws provide that, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (1) any derivative action or proceeding brought on behalf of us, (2) any action asserting a claim of breach of a fiduciary duty owed by any director, officer, employee or stockholder of Powell to Powell or our stockholders, including a claim for breach of fiduciary duty, (3) any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, our bylaws or certificate of incorporation or as to which the Delaware General Corporation Law confers jurisdiction on the Court of Chancery of the State of Delaware or (4) any action asserting a claim governed by the internal affairs doctrine or asserting an "internal corporate claim" shall, to the fullest extent permitted by law, be the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, another state court located within the State of Delaware or, if no court located within the State of Delaware has jurisdiction, the federal district court for the State of Delaware).
Added
To the fullest extent permitted by applicable law, this exclusive-forum provision applies to state and federal law claims, including claims under the federal securities laws, including the Securities Act of 1933, as amended, and the Exchange Act, although our stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder.
Added
This exclusive-forum provision may limit the ability of a stockholder to bring a claim in a judicial 14 forum of its choosing for disputes with us or our directors, officers or other employees, which may discourage lawsuits against us and our directors, officers and other employees.
Added
Alternatively, if a court were to find this exclusive-forum provision inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings described above, we may incur additional costs associated with resolving such matters in other jurisdictions, which could negatively affect our business, results of operations and financial condition.
Added
In addition, stockholders who do bring a claim in a state or federal court located within the State of Delaware could face additional litigation costs in pursuing any such claim, particularly if they do not reside in or near Delaware.
Added
In addition, the court located in the State of Delaware may reach different judgments or results than would other courts, including courts where a stockholder would otherwise choose to bring the action, and such judgments or results may be more favorable to us than to our stockholders.
Added
The OBBBA extends and modifies certain key 2017 Tax Cuts & Jobs Act (TCJA) provisions (both domestic and international) and revamps some of the TCJA’s provisions on the taxation of corporations’ foreign income. The OBBBA also expands certain Inflation Reduction Act incentives while accelerating the phase-out of others.
Added
Third parties may in the future assert that we have infringed, misappropriated, or otherwise violated their intellectual property rights. We cannot assure that our current or future technologies are not infringing or violating intellectual property rights of third parties.
Added
There is uncertainty about the future relationship between the U.S. and various other countries with respect to trade policies and tariffs. There is also uncertainty as to whether trade between the U.S. and other countries, including countries in which we operate and countries where our customers or suppliers operate, may be impacted by these policy developments.
Added
Moreover, announced changes and proposed changes to U.S. global trade policy, along with potential international retaliatory measures, have caused high volatility in global markets and uncertainty around short- and long-term economic impacts in the U.S., including concerns over inflation, recession and slowing growth.
Added
We continue to evaluate and monitor the potential impacts of these changes and measures, including the imposition of tariffs and ongoing legal challenges to such tariffs, on our business and operations, including increased costs of raw materials and engineered components as well as negative impacts on our margins; however, it is not possible to predict the impact, if any, of any changes or proposed changes to the U.S. global trade policy, or any international retaliatory measures, on our business and operations.
Added
Our insurance coverage may not be sufficient to compensate for all liability relating to any actual or potential disruption or other security breach or incident.
Added
For example, the State of California has published new rules that would require companies doing business in California to provide significantly expanded climate-related disclosures in their periodic reporting. New and proposed regulatory requirements may require us to incur significant additional costs to monitor and comply, and may also include additional internal control processes and procedures.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

4 edited+0 added−0 removed14 unchanged
Biggest changeOur cybersecurity policies and processes are fully integrated into our Enterprise Risk Management program and are based on the National Institute of Standards and Technology Framework for Improving Critical Infrastructure Cybersecurity (NIST Cybersecurity Framework), a toolkit for organizations to manage cybersecurity risk in its assessment of cybersecurity capabilities and in developing cybersecurity priorities.
Biggest changeOur cybersecurity policies and processes are fully integrated into our Enterprise Risk Management program and are based on the National Institute of Standards and Technology Framework for Improving Critical Infrastructure Cybersecurity (the NIST Cybersecurity Framework), a toolkit for organizations to manage cybersecurity risk in its assessment of cybersecurity capabilities and in developing cybersecurity priorities.
In addition to internal assessments, our cybersecurity strategy and capabilities are evaluated and audited against the NIST Framework and industry best practices by independent, third-party, leading specialists in cybersecurity. We strive to create a culture of cybersecurity resilience and awareness. This tone is set from the top and continuously reinforced with our employees through education and regular testing.
In addition to internal assessments, our cybersecurity strategy and capabilities are evaluated and audited against the NIST Cybersecurity Framework and industry best practices by independent, third-party, leading specialists in cybersecurity. We strive to create a culture of cybersecurity resilience and awareness. This tone is set from the top and continuously reinforced with our employees through education and regular testing.
Our Board of Directors has delegated responsibility to the Audit Committee for the oversight of cybersecurity risks. While cybersecurity resilience is the responsibility of every employee and contractor, the cybersecurity program is led by the Chief Information Security Officer who reports to the Chief Information Officer.
Our Board of Directors has delegated responsibility to the Audit Committee for the oversight of cybersecurity risks. While cybersecurity resilience is the responsibility of every employee and contractor, the cybersecurity program is led by the Chief Information Security Officer who reports to the Chief Financial Officer.
We have an information risk management program that includes a vendor risk assessment process, whereby we systematically oversee and identify risks from cybersecurity threats related to our use of key third-party service providers. 20 Cybersecurity Governance Our executive management team and Board of Directors oversee our policies with respect to risk assessment and the management of those risks that may be material to us, including cybersecurity risks.
We have an information risk management program that includes a vendor risk assessment process, whereby we systematically oversee and identify risks from cybersecurity threats related to our use of key third-party service providers. 21 Cybersecurity Governance Our executive management team and Board of Directors oversee our policies with respect to risk assessment and the management of those risks that may be material to us, including cybersecurity risks.

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−0 removed1 unchanged
Biggest changeOffice and manufacturing facility 7.9 129,200 Acheson, Alberta, Canada Office and manufacturing facility 20.1 330,168
Biggest changeOffice and manufacturing facility 7.9 129,200 Deeside, U.K. Office and manufacturing facility 4.3 42,329 Acheson, Alberta, Canada Office and manufacturing facility 20.1 330,168
We own 100% of the offices and facilities in the following principal locations as of September 30, 2024: Location Description Acres Approximate Square Footage Houston, TX Corporate office and manufacturing facility 21.4 428,515 Houston, TX Office and manufacturing facility 53.4 290,554 Houston, TX Office, fabrication facility, bulkhead and yard 62.4 82,320 Houston, TX Office and warehouse facility 9.3 37,200 North Canton, OH Office and manufacturing facility 8.0 115,200 Northlake, IL Office and manufacturing facility 10.0 103,500 Bradford, U.K.
We own 100% of the offices and facilities in the following principal locations as of September 30, 2025: Location Description Acres Approximate Square Footage Houston, TX Corporate office and manufacturing facility 21.4 428,515 Houston, TX Office and manufacturing facility 53.4 346,554 Houston, TX Office, fabrication facility, bulkhead and yard 62.4 82,320 Houston, TX Office and warehouse facility 9.3 37,200 North Canton, OH Office and manufacturing facility 8.0 115,200 Northlake, IL Office and manufacturing facility 10.0 103,500 Bradford, U.K.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

3 edited+1 added−1 removed0 unchanged
Biggest changeCope has served as Powell’s President and Chief Executive Officer since October 2016 and as the Chairman of the Board of Directors since 2019. Michael W. Metcalf has served as Powell’s Executive Vice President, Chief Financial Officer since December 2018. Robert B.
Biggest changeCope has served as Powell’s President and Chief Executive Officer since October 2016 and as the Chairman of the Board of Directors since 2019. Michael W. Metcalf has served as Powell’s Executive Vice President, Chief Financial and Principal Accounting Officer since February 2024, and as Powell’s Executive Vice President, Chief Financial Officer from December 2018 to February 2024.
Item 4. Mine Safety Disclosures Not applicable. 21 Information About Our Executive Officers The current executive officers of Powell are as follows: Name Age* Current Position with Powell Brett A. Cope 56 President and Chief Executive Officer, Chairman of the Board Michael W. Metcalf 57 Executive Vice President, Chief Financial Officer Robert B.
Item 4. Mine Safety Disclosures Not applicable. 22 Information About Our Executive Officers The current executive officers of Powell are as follows: Name Age* Current Position with Powell Brett A. Cope 57 President and Chief Executive Officer, Chairman of the Board Michael W.
Callahan 67 Vice President, Chief Human Resources Officer and Chief Information Officer *As of November 20, 2024. There are no family relationships among any of the executive officers named above or any member of our Board of Directors. The Board of Directors annually appoints the executive officers to serve. Brett A.
Metcalf 58 Executive Vice President, Chief Financial and Principal Accounting Officer Davide Tuninetti 50 Vice President, Chief Human Resources Officer *As of November 19, 2025. There are no family relationships among any of the executive officers named above or any member of our Board of Directors. The Board of Directors annually appoints the executive officers to serve. Brett A.
Removed
Callahan has served as Powell’s Vice President, Chief Human Resource Officer since 2010, and became Vice President, Chief Human Resource Officer and Chief Information Officer in 2019. 22 PART II
Added
Davide Tuninetti has served as Powell’s Vice President, Chief Human Resources Officer since February 2025. Mr. Tuninetti previously served as the Vice President Human Resources, Americas of GKN Powder Metallurgy from March 2019 to January 2025. 23 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

9 edited+0 added−0 removed0 unchanged
Biggest changeSmith Corporation; AZZ Inc.; Belden Inc.; CECO Environmental; Daktronics Inc.; EnerSys; Franklin Electric Co, Inc.; Gibraltar Industries, Inc.; LittelFuse Inc.; LSI Industries Inc.; Matthews International Corporation; Preformed Line Products Company; Thermon Group Holdings Inc. and Woodward, Inc. As a continuing effort to align our peer group with our industry, market capitalization, location and other factors, we have replaced A.O.
Biggest changeAs a continuing effort to align our peer group with our industry, end markets, market capitalization, location and other factors, we have removed AZZ Inc. from our peer group.
However, future cash dividend payments will depend on future earnings, capital requirements, financial condition and debt covenants. 23 Performance Graph The following Performance Graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933 or Securities Exchange Act of 1934, each as amended, except to the extent that we specifically incorporate it by reference into such filing.
However, future cash dividend payments will depend on future earnings, capital requirements, financial condition and debt covenants. 24 Performance Graph The following Performance Graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933 or Securities Exchange Act of 1934, each as amended, except to the extent that we specifically incorporate it by reference into such filing.
The comparison assumes that $100 was invested on October 1, 2019, in our common stock, the IShares Russell 2000, the Invesco S&P SmallCap 600 Energy, the new Industrial Electrical Equipment Group and the previous Industrial Electrical Equipment Group, and that all dividends were re-invested.
The comparison assumes that $100 was invested on October 1, 2020, in our common stock, the IShares Russell 2000, the Invesco S&P SmallCap 600 Energy, the new Industrial Electrical Equipment Group and the previous Industrial Electrical Equipment Group, and that all dividends were re-invested.
Dividend Policy We paid cash dividends to our common stockholders in each quarter of Fiscal 2024 and expect comparable cash dividend payments in the future.
Dividend Policy We paid cash dividends to our common stockholders in each quarter of Fiscal 2025 and expect comparable cash dividend payments in the future.
The stock price performance reflected on the following graph is not necessarily indicative of future stock price performance. 24 Item 6. [Reserved]
The stock price performance reflected on the following graph is not necessarily indicative of future stock price performance. 25 Item 6. [Reserved]
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock trades on the NASDAQ Global Market (NASDAQ) under the symbol “POWL.” Holders As of November 18, 2024, there were 200 stockholders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock trades on the NASDAQ Global Market (NASDAQ) under the symbol “POWL.” Holders As of November 17, 2025, there were 194 stockholders of record of our common stock.
Smith Corporation with Sterling Infrastructure, Inc. Accordingly, the new Industrial Electrical Equipment Group is composed of Ameresco, Inc.; AZZ Inc.; Belden Inc.; CECO Environmental; Daktronics Inc.; EnerSys; Franklin Electric Co, Inc.; Gibraltar Industries, Inc.; LittelFuse Inc.; LSI Industries Inc.; Matthews International Corporation; Preformed Line Products Company; Sterling Infrastructure, Inc.; Thermon Group Holdings Inc. and Woodward, Inc.
Accordingly, the new Industrial Electrical Equipment Group is composed of Ameresco, Inc.; Belden Inc.; CECO Environmental Corp.; Daktronics Inc.; EnerSys; Franklin Electric Co, Inc.; Gibraltar Industries, Inc.; LittelFuse Inc.; LSI Industries Inc.; Matthews International Corporation; Preformed Line Products Company; Sterling Infrastructure, Inc.; Thermon Group Holdings Inc. and Woodward, Inc. (collectively, the “New Industrial Electrical Equipment Group”).
(collectively, the “New Industrial Electrical Equipment Group”). The following graph compares, for the period from October 1, 2019 to September 30, 2024, the cumulative stockholder return on our common stock with the cumulative total return on the IShares Russell 2000, the Invesco S&P SmallCap 600 Energy, the new Industrial Electrical Equipment Group and the previous Industrial Electrical Equipment Group.
The following graph compares, for the period from October 1, 2020 to September 30, 2025, the cumulative stockholder return on our common stock with the cumulative total return on the IShares Russell 2000, the Invesco S&P SmallCap 600 Energy, the new Industrial Electrical Equipment Group and the previous Industrial Electrical Equipment Group.
In our Form 10-K for the fiscal year ended September 30, 2023, the performance graph included a peer index (the “Previous Industrial Electrical Equipment Group”) composed of Ameresco, Inc.; A.O.
In our Form 10-K for the fiscal year ended September 30, 2024, the performance graph included a peer index (the “Previous Industrial Electrical Equipment Group”) composed of Ameresco, Inc.; AZZ Inc.; Belden Inc.; CECO Environmental Corp.; Daktronics Inc.; EnerSys; Franklin Electric Co, Inc.; Gibraltar Industries, Inc.; LittelFuse Inc.; LSI Industries Inc.; Matthews International Corporation; Preformed Line Products Company; Sterling Infrastructure, Inc.; Thermon Group Holdings Inc. and Woodward, Inc.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

50 edited+25 added−10 removed44 unchanged
Biggest changeAny forward-looking statements made by or on our behalf are made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Readers are cautioned that such forward-looking statements involve risks and uncertainties, and the actual results may differ materially from those projected in the forward-looking statements.
Biggest change“Management ’ s Discussion and Analysis of Financial Condition and Results of Operations” in our Form 10-K for the fiscal year ended September 30, 2024, filed with the SEC on November 20, 2024. Any forward-looking statements made by or on our behalf are made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995.
We estimate the amount of variable consideration based on the expected value method, which is the sum of probability-weighted amounts, or the most likely amount method, which uses various factors including experience with similar transactions and assessment of our anticipated performance.
We estimate the amount of variable consideration based on the expected value method, which is the sum of the probability-weighted amounts, or the most likely amount method, which uses various factors including experience with similar transactions and assessment of our anticipated performance.
We have the 27 option to cash collateralize all or a portion of the letters of credit outstanding, which would favorably impact the consolidated funded indebtedness calculation and the consolidated net leverage ratio. On June 26, 2024, in connection with the expected discontinuation of the publication of the Canadian Dollar Offered Rate (CDOR), we further amended the U.S.
We have the option to cash collateralize all or a portion of the letters of credit outstanding, which would favorably impact the consolidated funded indebtedness calculation and the consolidated net leverage ratio. On June 26, 2024, in connection with the expected discontinuation of the publication of the Canadian Dollar Offered Rate (CDOR), we further amended the U.S.
In addition to the traditional crude oil refining and other oil and gas downstream processes, we have recently expanded our end markets into hydrogen production, carbon capture as well as alternative fuels, such as biofuels and sustainable aviation fuel, in response to the demand for clean energy. Electric utility market.
In addition to the traditional crude oil refining and other oil and gas downstream processes, we have expanded our end markets into hydrogen production, carbon capture as well as alternative fuels, such as biofuels and sustainable aviation fuel, in response to the demand for clean energy. Electric utility market.
We periodically review our job performance, job conditions, estimated profitability and final contract settlements, including our estimate of total costs and make revisions to costs and income in the period in which the revisions are probable and reasonably estimable. We bear the risk of cost overruns in most of our contracts, which may result in reduced profits.
We periodically review our job performance, job conditions, estimated profitability and final contract settlements, including our estimate of total costs and make revisions to costs and income in the period in which the revisions are probable and reasonably estimable. We bear the risk of cost overruns in most of our contracts, which may result in 31 reduced profits.
Whenever revisions of estimated contract costs and contract values indicate that the contract costs will exceed estimated revenues, thus creating a loss, a provision for the total estimated loss is recorded in that period. See Note E of Notes to Consolidated Financial Statements for disclosures related to changes in contract estimates.
Whenever revisions of estimated contract costs and contract values indicate that the contract costs will exceed estimated revenues, thus creating a loss, a provision for the total estimated loss is recorded in that period. See Note E. Revenue of the Notes to Consolidated Financial Statements for disclosures related to changes in contract estimates.
Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations for the twelve months ended September 30, 2024 compared to the twelve months ended September 30, 2023 should be read in conjunction with the accompanying consolidated financial statements and related notes included in this Annual Report.
Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations for the twelve months ended September 30, 2025 compared to the twelve months ended September 30, 2024 should be read in conjunction with the accompanying consolidated financial statements and related notes included in this Annual Report.
The increase in cash used in financing activities was primarily due to cash payments related to shares withheld in lieu of employee tax withholding, largely driven by the significant increase in our share price during Fiscal 2024 compared to Fiscal 2023.
The increase in cash used in financing activities was primarily due to cash payments related to shares withheld in lieu of employee tax withholding, largely driven by the significant increase in our share price during Fiscal 2025 compared to Fiscal 2024.
Variations in the actual outcome of these future tax consequences could materially impact our financial position and results of operations. See Note I of Notes to Consolidated Financial Statements for disclosures related to the valuation allowance recorded in relation to deferred taxes. 31
Variations in the actual outcome of these future tax consequences could materially impact our financial position and results of operations. See Note I. Income Taxes of the Notes to Consolidated Financial Statements for disclosures related to the valuation allowance recorded in relation to deferred taxes. 33
The North American market is responding to increased international demand for LNG and gas-to-chemical processes utilizing low-cost gas feedstocks.
The North American market is responding to increased international demand for liquefied natural gas (LNG) and gas-to-chemical processes utilizing low-cost gas feedstocks.
Although current commercial activity remains active in most of the markets that we compete in, we remain attentive to the macro environment and geopolitical events that may have an impact on future market activity. Oil and gas and petrochemical markets. Our order activity remains strong in these markets.
Although current commercial activity remains active in most of the markets that we compete in, we remain attentive to the macro environment and geopolitical events that may have an impact on future market activity. Oil and gas and petrochemical markets.
Approximately $77.7 million of our cash, cash equivalents and short-term investments at September 30, 2024 was held outside of the U.S. for our international operations. It is our intention to indefinitely reinvest all current and future foreign earnings internationally in order to ensure sufficient working capital to support our international operations.
Approximately $88.9 million of our cash, cash equivalents and short-term investments at September 30, 2025 was held outside of the U.S. for our international operations. It is our intention to indefinitely reinvest all current and future foreign earnings internationally in order to ensure sufficient working capital to support our international operations.
Financing Activities Net cash used in financing activities was $19.3 million during Fiscal 2024 compared to $13.1 million used during Fiscal 2023.
Financing Activities Net cash used in financing activities was $25.1 million during Fiscal 2025 compared to $19.3 million used during Fiscal 2024.
For additional information on the markets we serve, see “Markets” in Part I, Item 1 of this Annual Report. In Fiscal 2024, we reported revenues of $1.0 billion, net income of $149.8 million, and generated $108.7 million in cash from operating activities. As of September 30, 2024, we had total assets of $928.2 million.
For additional information on the markets we serve, see “Markets” in Part I, Item 1 of this Annual Report. In Fiscal 2025, we reported revenues of $1.1 billion, net income of $180.7 million, and generated $167.9 million in cash from operating activities. As of September 30, 2025, we had total assets of $1.1 billion.
Liquidity and Capital Resources As of September 30, 2024, current assets exceeded current liabilities by 1.8 times. Cash, cash equivalents and short-term investments increased to $358.4 million at September 30, 2024, compared to $279.0 million at September 30, 2023.
Liquidity and Capital Resources As of September 30, 2025, current assets exceeded current liabilities by 2.1 times. Cash, cash equivalents and short-term investments increased to $475.5 million at September 30, 2025, compared to $358.4 million at September 30, 2024.
Results of Operations Twelve Months Ended September 30, 2024 Compared to Twelve Months Ended September 30, 2023 Revenue and Gross Profit Revenues and costs are primarily related to custom engineered-to-order equipment and systems and are accounted for under percentage-of-completion accounting, which precludes us from providing detailed price and volume information.
We are currently evaluating the impact of the OBBBA on our operations, financial results and liquidity. 27 Results of Operations Twelve Months Ended September 30, 2025 Compared to Twelve Months Ended September 30, 2024 Revenue and Gross Profit Revenues and costs are primarily related to custom engineered-to-order equipment and systems and are accounted for under percentage-of-completion accounting, which precludes us from providing detailed price and volume information.
Revolver by entering into a conforming changes amendment with Bank of America, N.A. that added and amended certain terms related to the replacement of the BSBY as a benchmark rate with the Secured Overnight Financing Rate (SOFR) as administered by the Federal Reserve Bank of New York. As of September 30, 2024, there were no amounts borrowed under the U.S.
Revolver by entering into a conforming changes amendment with Bank of America, N.A. that added and amended certain terms related to the replacement of the BSBY as a benchmark rate with the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York. On September 30, 2025, we entered into a fourth amendment to the U.S.
Revolver, and letters of credit outstanding were $63.8 million. There was $86.2 million available for the issuance of letters of credit and borrowings under the U.S. Revolver as of September 30, 2024. For further information regarding our debt, see Notes G and H of Notes to Consolidated Financial Statements.
Revolver, and letters of credit outstanding were $77.5 million. There was $72.5 million available for the issuance of letters of credit and borrowings under the U.S. Revolver as of September 30, 2025. For further information regarding our debt, see Notes G. Long-Term Debt and H. Commitments and Contingencies of Notes to Consolidated Financial Statements.
We believe that our cash, cash equivalents and short-term investments, as well as available borrowings under our U.S. credit facility, will be sufficient to support our future operating activities, working capital requirements, payment of dividends and capital spending, as well as research and development initiatives for the next twelve months and beyond.
We believe that our cash, cash equivalents and short-term investments, as well as available borrowings under our U.S. credit facility, will be sufficient to support our ongoing operating activities, dividend payments and future organic and inorganic business growth, as well as research and development initiatives for the next twelve months and beyond.
Income Tax Provision We recorded an income tax provision of $46.2 million in Fiscal 2024, resulting in an effective tax rate of 24%, compared to an income tax provision of $14.4 million in Fiscal 2023 at an effective tax rate of 21%.
Income Tax Provision We recorded an income tax provision of $52.8 million in Fiscal 2025, resulting in an effective tax rate of 23%, compared to an income tax provision of $46.2 million in Fiscal 2024 at an effective tax rate of 24%.
In Fiscal 2024, the effective tax rate was favorably impacted by the estimated Research and Development (R&D) Tax Credit and tax benefits related to the vesting of restricted stock units. These items were offset by state income tax expense, certain non-deductible items, and the tax impact of U.S. global intangible income.
For both Fiscal 2025 and 2024, the effective tax rate was favorably impacted by tax benefits related to the vesting of restricted stock units and the estimated Research and Development Tax Credit, which were offset by state income tax expense and certain non-deductible items.
For additional information on the markets we serve, see “Markets” in Part I, Item 1 of this Annual Report. 26 Gross profit increased by 85%, or $125.5 million, to $273.1 million in Fiscal 2024. Gross profit as a percentage of revenues increased to 27% in Fiscal 2024 as compared to 21% in Fiscal 2023.
For additional information on the markets we serve, see “Markets” in Part I, Item 1 of this Annual Report. Gross profit increased by 19%, or $51.3 million, to $324.4 million in Fiscal 2025. Gross profit as a percentage of revenues increased to 29% in Fiscal 2025 as compared to 27% in Fiscal 2024.
A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue as the performance obligations are satisfied.
Performance Obligations A performance obligation is a promise in a contract or with a customer to transfer a distinct good or service. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue as the performance obligations are satisfied.
In the event that we elect to repatriate some or all of the foreign earnings that were previously deemed to be indefinitely reinvested outside the U.S., we may incur additional tax expense upon such repatriation under current tax laws.
In the event that we elect to repatriate some or all of the foreign earnings that were previously deemed to be indefinitely reinvested outside the U.S., we may incur additional tax expense upon such repatriation under current tax laws. 29 Cash Flows Operating Activities Operating activities provided net cash of $167.9 million during Fiscal 2025 and provided net cash of $108.7 million during Fiscal 2024.
We believe that this method is the most accurate representation of our performance because it directly measures the value of the services transferred to the customer over time as we incur costs on our contracts.
We believe that this method is the most accurate representation of our performance because it directly measures the value of the services transferred to the customer over time as we incur costs on our contracts. Contract costs include all direct materials, labor and indirect costs related to contract performance, which may include indirect labor, supplies, tools, repairs and depreciation costs.
These increases in revenue were driven by improved market conditions in most of our end markets, increased capital spending in our core oil, gas and petrochemical markets, as well as our strategic effort to expand our business into electric utility and commercial and other industrial markets.
These increases in revenue were primarily driven by our strategic effort to expand our business into electric utility and commercial and other industrial markets and the improved market conditions in these end markets.
We have spent $1.5 million on the expansion project in Fiscal 2024. 28 Other Commercial Commitments We are contingently liable for letters of credit and bank guarantees totaling $71.0 million as of September 30, 2024, with the following potential cash outflows in the event that we are unable to perform under our contracts (in thousands): Payments Due by Period: Letters of Credit/ Bank Guarantees Less than 1 year $ 27,587 1 to 3 years 42,336 More than 3 years 1,064 Total commercial commitments $ 70,987 We also had surety bonds totaling $426.8 million that were outstanding at September 30, 2024.
Other Commercial Commitments We are contingently liable for letters of credit and bank guarantees totaling $81.4 million as of September 30, 2025, with the following potential cash outflows in the event that we are unable to perform under our contracts (in thousands): Payments Due by Period: Letters of Credit/ Bank Guarantees Less than 1 year $ 38,919 1 to 3 years 35,426 More than 3 years 7,099 Total commercial commitments $ 81,444 30 We also had surety bonds totaling $417.3 million that were outstanding at September 30, 2025.
For a description of the risks and uncertainties, please see “Cautionary Statement Regarding Forward-Looking Statements” and Part I, Item 1A. “Risk Factors” included elsewhere in this Annual Report.
Readers are cautioned that such forward-looking statements involve risks and uncertainties, and the actual results may differ materially from those projected in the forward-looking statements. For a description of the risks and uncertainties, please see “Cautionary Statement Regarding Forward-Looking Statements” and Part I, Item 1A. “Risk Factors” included elsewhere in this Annual Report.
Projects may require, on occasion, warranty terms that are longer than our standard terms due to the nature of the project. Extended warranty terms may be negotiated and included in our contracts. The allocated revenue associated with the extended warranty is deferred and recorded as a contract liability and recognized as revenue over the extended warranty period.
Projects may require, on occasion, warranty terms that are longer than our standard terms due to the nature of the project. Extended warranty terms may be negotiated and included in our contracts.
Accounting for Income Taxes We account for income taxes under the asset and liability method, based on the income tax laws and rates in the countries in which operations are conducted, and income is earned.
The allocated revenue associated with the extended warranty is deferred and recorded as a contract liability and recognized as revenue over the extended warranty period. 32 Accounting for Income Taxes We account for income taxes under the asset and liability method, based on the income tax laws and rates in the countries in which operations are conducted, and income is earned.
We believe the fundamentals of the U.S. natural gas market, through abundant supply and low cost, will continue to support investments in LNG, related gas processing, and petrochemical processes, and as a result, will continue to sustain our order activity associated with such markets.
We believe the fundamentals of the U.S. natural gas market, through abundant supply and low cost, has supported investments in LNG, related gas processing, and petrochemical processes, and as a result, has sustained our order activity associated with such markets, which is evidenced by two large, domestic LNG project awards during the first half of Fiscal 2025.
Fixed-price contracts can limit our ability to pass these increases to our customers, thus negatively impacting our earnings and operations in future periods. During Fiscal 2024, we experienced commodity price volatility, in addition to the ongoing supply chain delays for specific engineered components that have been persistent. We are working closely with our suppliers to meet our customer commitments.
Fixed-price contracts can limit our ability to pass these increases to our customers, thus negatively impacting our earnings and operations in future periods. During Fiscal 2025, we continued experiencing high volatility in commodity prices, and ongoing supply chain delays for specific engineered components remained a persistent challenge for us.
On October 4, 2023, we entered into a third amendment (the Third Amendment) to our credit agreement with Bank of America, N.A. (as amended, the U.S. Revolver).
Our capital allocation plan depends upon a number of factors, including market conditions, our financial position and capital requirements, financial conditions, competing uses for cash, and other factors. On October 4, 2023, we entered into a third amendment (the Third Amendment) to our credit agreement with Bank of America, N.A. (as amended, the U.S. Revolver).
Outlook Our backlog was $1.3 billion as of September 30, 2024, of which approximately $849 million is expected to be recognized as revenue during our fiscal year ending September 30, 2025.
Business Acquisition of the Notes to Consolidated Financial Statements for additional information. Outlook Our backlog increased to $1.4 billion as of September 30, 2025, of which approximately $824 million is expected to be recognized as revenue during our fiscal year ending September 30, 2026.
For discussion and analysis of our financial condition and results of operations for Fiscal Year 2023 as compared to Fiscal Year 2022, please refer to Part II, Item 7. “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Form 10-K for the fiscal year ended September 30, 2023, filed with the SEC on December 6, 2023.
For discussion and analysis of our financial condition and results of operations for Fiscal Year 2024 as compared to Fiscal Year 2023, please refer to Part II, Item 7.
Aligned with our strategy of end-market diversification, we seek to continue our focus and growth in electrical distribution substations, while also addressing a resurgence of power generation investment in this market. Commercial and other industrial markets.
Aligned with our strategy of end-market diversification, we seek to continue our focus and growth in electrical distribution substations, while also addressing a resurgence of power generation investment in this market. During the 26 third quarter of Fiscal 2025, we won a project for a new power generation plant, representing the largest electric utility award in the Company’s history.
Backlog The order backlog, which is our remaining unsatisfied performance obligations, represents the estimated transaction price for goods and services for which we have a material right, but work has not been performed. The order backlog at September 30, 2024 was $1.3 billion, consistent with our backlog at September 30, 2023.
The increase in net income was primarily driven by higher revenue and improved gross profit margin in Fiscal 2025. Backlog The order backlog, which is our remaining unsatisfied performance obligations, represents the estimated transaction price for goods and services for which we have a material right, but work has not been performed.
In addition, we estimate the useful lives of our long-lived assets and other intangibles, and periodically review these estimates to determine whether these lives are appropriate. 30 Accruals for Contingent Liabilities From time to time, contingencies such as insurance-related claims, liquidated damages and legal claims arise in the normal course of business.
Accruals for Contingent Liabilities From time to time, contingencies such as insurance-related claims, liquidated damages and legal claims arise in the normal course of business.
Cash Flows Operating Activities Operating activities provided net cash of $108.7 million during Fiscal 2024 and provided net cash of $182.6 million during Fiscal 2023. Cash flow from operations is primarily influenced by project volume and margins, as well as working capital requirements, the timing of milestone payments from our customers, and payment terms with our suppliers.
Cash flow from operations is primarily influenced by project volume and margins, as well as working capital requirements, the timing of milestone payments from our customers, and payment terms with our suppliers. The increase in operating cash flow was primarily driven by improved earnings and a steady allocation of working capital to projects in the order book.
The decrease in cash used in investing activities during Fiscal 2024 was primarily due to lower net purchase of short-term investments, partially offset by higher capital spending on property, plant and equipment in Fiscal 2024. During Fiscal 2024, our purchase of short-term investments was $9.7 million compared with net purchase of short-term investments of $18.8 million in Fiscal 2023.
During Fiscal 2024, cash used in investing activities was primarily associated with the net purchase of short-term investments, a cash purchase of land and buildings in Houston, Texas for $5.6 million, and regular capital spending on property, plant and equipment.
Revenue from our light rail traction power market decreased by 22%, or $6.1 million, to $22.0 million in Fiscal 2024 due to less project volume in this market.
Revenue from our oil and gas market (excluding petrochemical) decreased by 3%, or $10.6 million, to $406.6 million and revenue from all other markets combined decreased by 6%, or $3.0 million to $48.1 million in Fiscal 2025 due to less project volume.
International revenues increased by 17%, or $24.5 million, to $165.8 million in Fiscal 2024. Our international revenues include both revenues generated from our international facilities as well as revenues from export projects generated at our domestic facilities.
International revenues increased by 35%, or $58.3 million, to $224.1 million in Fiscal 2025, primarily driven by increased project volume from our Canada operations and increased activity in the Middle East and Africa region. Our international revenues include both revenues generated from our international facilities as well as revenues from export projects generated at our domestic facilities.
Selling, General and Administrative Expenses Selling, general and administrative expenses increased by 8%, or $6.1 million, to $84.9 million in Fiscal 2024, primarily due to increased compensation expense and higher spending on infrastructure improvements.
Selling, General and Administrative Expenses Selling, general and administrative expenses increased by 12%, or $10.5 million, to $95.4 million in Fiscal 2025, primarily due to higher compensation expense and costs associated with the acquisition of Remsdaq. Selling, general and administrative expenses as a percentage of revenues increased to 9% in Fiscal 2025, compared to 8% in Fiscal 2024.
We have experienced strong growth in these end markets driven by a mix of factors including increased investment in commercial and light industrial facilities for the production of various goods, the expansion of data centers and cloud computing, as well as the growing demand in industrial applications to support new technologies driving the energy transition.
Commercial and other industrial markets. As a result of a mix of factors we are experiencing steady growth in commercial facilities that provide for the production of various consumer goods and the expansion of data centers that support cloud computing and increasing investments in artificial intelligence. We are also experiencing increased activity in other industrial end markets.
Revenues increased by 45%, or $313.0 million, to $1.0 billion in Fiscal 2024, primarily driven by the increase in project backlog resulting from large contracts awarded during Fiscal 2023 and strong bookings throughout Fiscal 2024. Domestic revenues increased by 52%, or $288.6 million, to $846.5 million in Fiscal 2024.
Revenues increased by 9%, or $92.0 million, to $1.1 billion in Fiscal 2025, primarily driven by strong project backlog at the end of Fiscal 2024 and strong bookings that continued throughout Fiscal 2025. Domestic revenues increased by 4%, or $33.7 million, to $880.2 million in Fiscal 2025.
This increase in cash, cash equivalents and short-term investments was primarily driven by our improved earnings due to increased project margins and volumes, partially offset by working capital allocated to projects in our order book, capital spending, as well as dividend payments.
The increase in cash, cash equivalents and short-term investments was primarily driven by our strong earnings, partially offset by working capital commitment, cash paid for the Remsdaq acquisition, capital spending, dividend payments, and cash payments related to shares withheld in lieu of employee tax withholding.
The effect of any impairment would be reflected in operating income in the Consolidated Statements of Operations.
The effect of any impairment would be reflected in operating income in the Consolidated Statements of Operations. In addition, we estimate the useful lives of our long-lived assets and other intangibles, and periodically review these estimates to determine whether these lives are appropriate.
Bookings, net of cancellations and scope reductions, decreased by 24% in Fiscal 2024 to $1.1 billion, compared to $1.4 billion in Fiscal 2023. Despite strong bookings in Fiscal 2024, the decrease in bookings was due to a normalization of the oil and gas sector with fewer large orders awarded in this sector during Fiscal 2024.
Bookings, net of cancellations and scope reductions, increased by 9% in Fiscal 2025 to $1.2 billion, compared to $1.1 billion in Fiscal 2024. This increase was primarily driven by improved bookings in oil and gas, electric utility and light rail traction power markets, partially offset by decreased net bookings in the petrochemical market.
Planned Capital Spending We have planned capital spending of approximately $11 million on a facility expansion project at our products factory in Houston. We expect to complete the expansion project by mid-Fiscal 2025.
Investing Activities Investing activities used $8.3 million of cash during Fiscal 2025 and used $21.9 million of cash in Fiscal 2024. Cash used in investing activities during Fiscal 2025 was primarily attributable to the Remsdaq acquisition and the capital spending on the facility expansion and improvement project at our electrical products facility in Houston.
In response to the increased cost environment and supply chain challenges, we strive to effectively manage our product pricing, delivery schedules and bid validity dates with our customers, as well as improve factory efficiencies and project execution, and as a result our gross margins have been improved in Fiscal 2024.
In response to the rising cost environment and persistent supply chain challenges, we are taking strategic measures to effectively manage our product pricing, refine delivery schedules, and manage bid validity dates with our customers. Our supplier engagement includes improving forecasting and negotiating favorable terms that allow us to meet or exceed customer timelines.
Removed
We are cautiously optimistic regarding the anticipated investment across AI applications that may drive data center growth and subsequently power generation demand. 25 Business Environment The markets in which we participate are capital-intensive and cyclical in nature.
Added
On August 15, 2025, we completed the previously announced business acquisition of Remsdaq Limited (Remsdaq), a U.K.-based manufacturer of Supervisory Control and Data Acquisition (SCADA) Remote Terminal Units (RTUs) for electrical substation control and automation in generation, transmission and distribution, for a total consideration of £13.6 million Pounds Sterling, or $18.4 million, including cash acquired.
Removed
In Fiscal 2024, revenue from our core oil and gas market (excluding petrochemical) increased by 53%, or $144.1 million, to $417.2 million in Fiscal 2024; petrochemical market revenue increased by 97%, or $91.4 million, to $185.6 million; revenue from our electric utility market increased by 18%, or $28.1 million, to $186.5 million; commercial and other industrial market revenue increased by 44%, or $45.9 million, to $149.9 million; and revenue from all other markets combined increased by 23%, or $9.6 million to $51.1 million.
Added
The acquisition advances our key strategic initiative to expand our automation platform capabilities. We believe the combination of Powell’s hardware and detection sensors with Remsdaq’s SCADA RTUs creates a highly synergistic integration that positions us to effectively meet the growing demand for more sophisticated solutions that enhance utility operational efficiency, system reliability and security. See Note P.
Removed
This increase in gross profit is attributable to the higher volume levels across all of Powell's manufacturing facilities generating favorable volume leverage, strong project execution, and continuing effort to improve factory efficiencies while also managing product pricing that corresponds to current cost levels.
Added
Other oil and gas end markets have remained active as well, and we secured two large, offshore projects in our core oil and gas end markets during the third quarter of Fiscal 2025.
Removed
Selling, general and administrative expenses as a percentage of revenues decreased to 8% in Fiscal 2024, compared to 11% in Fiscal 2023, resulting from higher revenues on our existing cost structure.
Added
In the first half of Fiscal 2025, we secured a large mining project for the production of potash, which is expected to be executed in late Fiscal 2027 and beyond.
Removed
In Fiscal 2023, the effective tax rate approximated the U.S. federal statutory rate.
Added
Additionally, we booked an order for a domestic light rail traction power project in the third quarter of Fiscal 2025, representing the first large traction power project booked in several quarters. Business Environment The markets in which we participate are capital-intensive and cyclical in nature.
Removed
The favorable impacts of the estimated R&D Tax Credit and the release of the valuation allowance previously recorded against the U.K. net deferred tax assets in the amount of $1.9 million were offset by state income tax expense, certain non-deductible items and the tax impact of U.S. global intangible income.
Added
Moreover, ongoing and recently proposed changes to U.S. global trade policy, along with potential international retaliatory measures, and concerns over inflation, recession and slowing growth have continued to cause high volatility in global markets and uncertainty around short- and long-term economic impacts in the United States and other markets we serve.
Removed
Net Income In Fiscal 2024, we recorded net income of $149.8 million, or $12.29 per diluted share, compared to net income of $54.5 million, or $4.50 per diluted share in Fiscal 2023. This increase in net income is primarily due to higher revenues coupled with improved gross profit margins, as well as our disciplined cost structure.
Added
We continue to evaluate and monitor the potential impacts of these changes and measures, including the imposition of tariffs, on our business and operations.
Removed
The decrease in operating cash flow was primarily due to working capital impact as we allocate capital to the projects in the order book, partially offset by higher net income resulting from increased project volume and improved project margins. Investing Activities Investing activities used $21.9 million of cash during Fiscal 2024 and used $26.6 million in Fiscal 2023.
Added
We could potentially face the challenge of increased costs of raw materials and engineered components as well as negative impacts on our margins; however, it is not possible to predict the impact, if any, of any changes or proposed changes to the U.S. global trade policy, or any international retaliatory measures, on our business and operations.
Removed
In July 2024, we made a cash purchase of land and buildings in Houston, Texas for $5.6 million to help further facilitate executing the current backlog as well as planning for modest future volume growth. In addition, we acquired intellectual property in December 2023 for a total consideration of $0.5 million, of which $250 thousand was paid in cash.
Added
Additionally, we remain focused on enhancing factory efficiencies and improving project execution to mitigate risks and maintain customer satisfaction. On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act (the OBBBA), which includes a broad range of tax reform provisions affecting businesses.
Removed
Contract costs include all direct materials, labor and indirect costs related to contract performance, which may include indirect labor, supplies, tools, repairs and depreciation costs. 29 Performance Obligations A performance obligation is a promise in a contract or with a customer to transfer a distinct good or service.
Added
The OBBBA extends and modifies certain key 2017 Tax Cuts & Jobs Act (TCJA) provisions (both domestic and international) and revamps some of the TCJA’s provisions on the taxation of corporations’ foreign income. The OBBBA also expands certain Inflation Reduction Act incentives while accelerating the phase-out of others.
Added
In Fiscal 2025, revenue from our electric utility market increased by 50%, or $92.4 million, to $279.0 million; commercial and other industrial market revenue increased by 19%, or $28.3 million, to $178.2 million; and revenue from our light rail traction power market increased by 87%, or $19.2 million, to $41.3 million.
Added
Revenue from our petrochemical market decreased by 19%, or $34.4 million, to $151.2 million with the reduction in backlog and bookings in this market and as the business nears completion of the large petrochemical order secured in Fiscal 2023.
Added
This increase in gross profit was primarily driven by higher revenues and improved gross profit margin due to favorable volume leverage and strong project execution in a stable pricing environment throughout Fiscal 2025.
Added
Additionally in Fiscal 2024, these benefits were offset by an income inclusion related to U.S. global intangible income. Net Income In Fiscal 2025, we recorded net income of $180.7 million, or $14.86 per diluted share, compared to net income of $149.8 million, or $12.29 per diluted share in Fiscal 2024.
Added
The order backlog at September 30, 2025 was $1.4 billion, a 3% increase from our $1.3 billion backlog at September 30, 2024. This increase was mainly driven by electric utility, commercial and other industrial and light rail traction power markets, partially offset by a decrease in the petrochemical market.
Added
As of September 30, 2025, electric utility and oil and gas (excluding petrochemical) markets each 28 accounted for 33% of our backlog, the commercial and other industrial market accounted for 15% and the petrochemical and light rail traction power markets each accounted for 8% of our backlog.
Added
We invest our cash, cash equivalents and short-term investments in accordance with the Company’s investment policy approved by the Board of Directors.
Added
As we assess our capital allocation framework relative to our strategic objectives, we will continue to deploy capital to both organic and inorganic initiatives, as well as maintain a prudent approach to other methods that improve shareholder value. We regularly assess our capital allocation framework.
Added
Our current intention is to prioritize our working capital needs, fund research, capital expenditures and other organic growth opportunities, while also returning capital to shareholders and evaluating strategic inorganic opportunities as they arise.
Added
Revolver associated with a reorganization of holding companies of our foreign subsidiaries, replacing the prior share pledge on 65% of the equity interests of Powell Industries International, B.V., with the share pledge on 65% of the equity interest of Powell Industries International Limited. As of September 30, 2025, there were no amounts borrowed under the U.S.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeOur accumulated other comprehensive loss, which is included as a component of stockholders’ equity, was $24.4 million as of September 30, 2024, a decrease of $2.5 million compared to September 30, 2023.
Biggest changeOur accumulated other comprehensive loss, which is included as a component of stockholders’ equity, was $27.0 million as of September 30, 2025, an increase of $2.7 million compared to September 30, 2024.
We attempt to pass along such commodity price increases to our customers on a contract-by-contract basis to avoid a negative effect on our gross margin. We enter into derivative contracts to hedge a portion of our exposure to commodity price risk. These contracts were immaterial to our earnings and cash flows for Fiscal 2024, 2023 and 2022.
We attempt to pass along such commodity price increases to our customers on a contract-by-contract basis to avoid a negative effect on our gross margin. We enter into derivative contracts to hedge a portion of our exposure to commodity price risk. These contracts were immaterial to our earnings and cash flows for Fiscal 2025, 2024 and 2023.
This decrease in comprehensive loss was primarily a result of fluctuations in the currency exchange rates for the Canadian Dollar and British Pound Sterling as we re-measured the foreign operations of those divisions. Interest Rate Risk If we borrow under our U.S.
This increase in comprehensive loss was primarily a result of fluctuations in the currency exchange rates for the Canadian Dollar and British Pound Sterling as we re-measured the foreign operations of those divisions. Interest Rate Risk If we borrow under our U.S.
From time to time, our foreign subsidiaries may enter into foreign exchange forward contracts to hedge their foreign currency exposures, if any. These contracts were insignificant to our earnings and cash flows for Fiscal 2024, 2023 and 2022. We do not typically hedge our exposure to potential foreign currency translation adjustments.
From time to time, our foreign subsidiaries may enter into foreign exchange forward contracts to hedge their foreign currency exposures, if any. These contracts were insignificant to our earnings and cash flows for Fiscal 2025, 2024 and 2023. We do not typically hedge our exposure to potential foreign currency translation adjustments.
Additionally, expenses associated with these transactions are generally contracted and paid for in the same local currencies. Our realized foreign exchange loss was $0.8 million and $0.4 million, respectively for Fiscal 2024 and Fiscal 2023. These losses were included in selling, general and administrative expenses in our Consolidated Statements of Operations.
Additionally, expenses associated with these transactions are generally contracted and paid for in the same local currencies. Our realized foreign exchange loss was $0.3 million and $0.8 million, respectively for Fiscal 2025 and Fiscal 2024. These losses were included in selling, general and administrative expenses in our Consolidated Statements of Operations.
Revolver as of both September 30, 2024 and 2023, we have not experienced any significant interest rate risk for each of the periods presented in our Consolidated Statements of Operations. 32
Revolver as of both September 30, 2025 and 2024, we have not experienced any significant interest rate risk for each of the periods presented in our Consolidated Statements of Operations. 34

Other POWL 10-K year-over-year comparisons