ZWS

EX-99.1

2 ex991earningsrelease93026.htm

EX-99.1

Document

Exhibit 99.1

Press Release

October 27, 2026Contact Information:

For Immediate ReleaseBobbi Belstner

Vice President, Corporate Controller

414.361.0122

Zurn Elkay Water Solutions Reports Third Quarter 2026 Financial Results

Investor call scheduled for Wednesday, October 28, 2026 at 8:30 a.m. Eastern Time

MILWAUKEE, WI (USA) - Zurn Elkay Water Solutions Corporation (NYSE:ZWS)

Third Quarter Highlights

•Net sales in the quarter were $495 million compared with $455 million in last year’s September quarter (+7% core sales(1), +2% acquisitions).

•Net income from continuing operations was $76 million (diluted EPS from continuing operations of $0.45) compared with net income from continuing operations of $60 million (diluted EPS from continuing operations of $0.35) in the year-ago quarter.

•Adjusted EBITDA(1) was $140 million (28.3% of net sales) compared with $122 million (26.8% of net sales) in last year's third quarter.

•Adjusted EPS(1) was $0.52 compared with $0.43 in the year-ago quarter.

•Free cash flow(1) of $110 million, excluding International Emergency Economic Powers Act ("IEEPA") reciprocal tariff refunds received, net of related taxes paid; Net debt leverage(1) of 0.4x as of September 30, 2026.

•Completed acquisition of Intellihot, Inc. ("Intellihot").

•Deployed $35 million to repurchase 0.7 million shares of common stock in the quarter.

•Increased annual dividend 18% to $0.52 per share.

Todd A. Adams, Chairman and Chief Executive Officer, commented, “We delivered 7% core sales(1) growth, 28.3% adjusted EBITDA margins(1) and free cash flow(1) of $110 million in the third quarter. We were able to leverage our exceptional free cash flow(1) to invest $35 million in share repurchases in the quarter as well as fund the Intellihot acquisition, which closed during the third quarter. Finally, we are increasing our annual dividend by 18% to $0.52 per share, reflecting the confidence we have in the long-term fundamentals of our business and business model driven by the Zurn Elkay Business System.”

Adams continued, “Last quarter we announced the acquisition of Intellihot, which along with our Wilkins backflow are key components of the hot water loop. Earlier this month, we continued to build out our presence in the hot water loop with the entrance into the digital master mixing valve market with internally developed new products that we believe will allow us to take meaningful, profitable share in the category over the next several years. These breakthrough initiatives are part of our continued focus to leverage our significant competitive advantages into adjacencies. In 2026 alone, we believe we’ve expanded our served markets by roughly $400 million. While we’re encouraged with our progress, we are also aware that we must continue to be nimble in finding pockets of growth to offset the general uncertainty that exists within our served markets and the broader economy.”

Fourth Quarter and Full Year Outlook

“As we start the fourth quarter, it feels like a time to be conservative in our assumptions while remaining aggressive with our actions with everything that’s happening in the world right now. For the fourth quarter, we expect net sales to be between $430 million to $437 million and adjusted EBITDA(1) between $120 million to $123 million and full year free cash flow(1) to be greater than $350 million, excluding the net impact of tariff related refunds received.”

Third Quarter 2026 Overview

Net sales were $495.1 million and $455.4 million during the three months ended September 30, 2026 and September 30, 2025, respectively, an increase of 9% year over year. Core sales improved 7% year over year, including growth in nearly all product categories, as well as an additional 2% increase resulting from our acquisition of Intellihot.

During the three months ended September 30, 2026, income from operations was $108.2 million compared to $77.5 million during the three months ended September 30, 2025. Income from operations as a percentage of net sales increased by 490 basis points year over year as a result of product mix, Zurn Elkay Business System led productivity initiatives and supply chain repositioning.

Adjusted EBITDA(1) was $140.1 million, or 28.3% of net sales, during the three months ended September 30, 2026 compared to $122.2 million, or 26.8% of net sales, during the three months ended September 30, 2025.

(1)    Refer to "Non-GAAP Financial Measures" for a definition of this non-GAAP metric, as well as the accompanying reconciliations to GAAP.

Non-GAAP Financial Measures

The following non-GAAP financial measures are utilized by management in comparing our operating performance on a consistent basis. We believe that these financial measures are appropriate to enhance an overall understanding of our underlying operating performance trends compared to historical and prospective periods and our peers. Management also believes that

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