Zurn Elkay beats fourth quarter estimates, forecasts growth for 2026

Zurn Elkay Water Solutions Corp (ZWS.N) on Tuesday reported fourth-quarter results that exceeded its own guidance, driven by double-digit core sales growth and expanding profit margins.

Fourth Quarter Highlights

The Milwaukee-based water management company posted net sales of $407 million for the quarter ended Dec. 31, 2025, a 10% increase compared to $371 million in the same period last year. This growth was supported by gains across nearly all product categories and price realization strategies.

Adjusted earnings per share came in at $0.36, topping the $0.32 reported in the year-ago quarter. Net income from continuing operations rose to $42 million, or $0.24 per diluted share, up from $36 million, or $0.21 per share, a year earlier.

In the fourth quarter, we delivered sales, adjusted EBITDA and free cash flow ahead of our guidance from 90 days ago. Relentless deployment of the Zurn Elkay Business System, which helped expand adjusted EBITDA margins by 100 basis points to 25.6%.

For the full year 2025, the company reported record net sales of $1.696 billion, an 8% increase over 2024. Full-year net income reached $192 million, while free cash flow hit a record $317 million.

The company utilized its strong cash position to reward shareholders, completing $160 million in common stock repurchases throughout 2025 and increasing its quarterly dividend by 22% year-over-year. Zurn Elkay ended the year with a net debt leverage of 0.4x.

2026 Outlook

Looking ahead, Zurn Elkay provided an optimistic framework for 2026. The company expects full-year core sales growth in the mid-single digits and projects free cash flow to rise further to approximately $335 million.

For the first quarter of 2026, the company anticipates core sales growth of 7% to 8%, with adjusted EBITDA margins expected between 25.5% and 26.0%.

Zurn Elkay, which specializes in water safety, hygiene, and flow control products, also announced it would release its 2025 sustainability report in the coming weeks, highlighting progress toward cleaner and safer water management.