Loar Holdings (LOAR) Q2 2025 earnings summary

Executive summary

• Q2 2025 net sales reached $123.1M, up 26.9% year-over-year, with net income up 119% to $16.7M, driven by organic growth, productivity optimization, and acquisitions.

• Gross margin improved to 53.8% from 49.0% year-over-year, reflecting operating leverage and favorable sales mix.

• Adjusted EBITDA rose 34.5% to $47.1M, with margin expanding to 38.3%.

• Recent acquisitions include Beadlight Ltd. for $33M, completed in July 2025, and a pending LMB Fans & Motors deal for €365M plus net debt.

• Diverse product portfolio with over 20,000 products, no single part exceeding 3% of annual net sales.

Financial highlights

• Q2 2025 net sales: $123.1M (+26.9% YoY); net income: $16.7M (+119% YoY); adjusted EBITDA: $47.1M (+34.5% YoY); adjusted EBITDA margin: 38.3% (up from 36.1%).

• Gross profit: $66.2M (+39.3% YoY); net income margin: 13.6% (up from 7.9%).

• Year-to-date net sales: $237.8M (+25.9% YoY); net income: $32.0M (+224% YoY); adjusted EBITDA: $90.3M (38.0% margin).

• Free cash flow conversion: 148% YTD 2025; cash and cash equivalents at June 30, 2025: $103.3M.

• Interest expense for Q2 2025 decreased 39.1% YoY to $6.5M; long-term debt at June 30, 2025: $277.7M.

Outlook and guidance

• 2025 net sales guidance raised to $486M–$494M; adjusted EBITDA to $184M–$187M (margin ~38%); net income $65M–$70M; adjusted EPS $0.83–$0.88.

• Diluted EPS guidance: $0.68–$0.73; interest expense forecast reduced to $26M; effective tax rate at ~25%.

• Market assumptions: high single-digit OEM growth, low double-digit aftermarket growth, high double-digit defense growth.

• CapEx projected at ~$14M (2–3% of sales); D&A ~$51M; share count ~97M.

• Guidance includes Beadlight acquisition but excludes pending LMB Fans & Motors acquisition.