Loar Holdings (LOAR) Q1 2025 earnings summary

Executive summary

• Achieved record Q1 2025 net sales of $114.7M, up 24.8% year-over-year, with organic growth of 11.1% and strong contributions from the Applied Avionics acquisition.

• Net income rose to $15.3M (13.4% margin), up from $2.2M (2.4% margin) in Q1 2024, reflecting improved operating leverage and lower interest expense.

• Adjusted EBITDA increased 30.6% year-over-year to $43.1M, with margin expanding to 37.6%.

• All major end-markets (OEM, Commercial Aftermarket, Defense) posted record sales for any quarter in company history.

• The company completed its IPO in April 2024 and a follow-on offering in December 2024, raising over $637M in net proceeds.

Financial highlights

• Gross profit for Q1 2025 was $59.7M, up 34.4% year-over-year, with gross margin improving to 52.1%.

• Operating income rose to $26.1M (22.8% margin); net income margin improved to 13.4% from 2.4% year-over-year.

• Adjusted EBITDA margin reached 37.6% in Q1 2025, up from 36.0% in Q1 2024.

• Cash flow from operations was $28.4M, up from $10.8M in Q1 2024; capex was $1.8M.

• Interest expense for Q1 2025 was $6.5M, with full-year guidance of ~$28M.

Outlook and guidance

• Raised 2025 guidance: net sales $482M–$490M, adjusted EBITDA $182M–$185M, net income $59M–$64M, and adjusted EPS $0.71–$0.76.

• Adjusted EBITDA margin expected to remain ~37.5% for 2025.

• Assumes high single-digit OEM growth, low double-digit aftermarket growth, and high double-digit (17–20%) defense growth.

• Guidance excludes impact of pending LMB Fans & Motors acquisition, expected to close Q3 2025.

• Effective tax rate for 2025 expected at ~30%; diluted share count at ~97M.