EnerSys (ENS) Q1 Fiscal 2027 Earnings Call: Cash Flow, Data Center and Defense Growth
Source Tradingkey
Key Takeaways
- EnerSys reported fiscal Q1 2027 net sales of $936 million, up 5% year over year, supported by a 3% price/mix benefit, 1% volume growth and 1% favorable foreign currency translation.
- Reported gross margin rose 510 basis points to 33.5%. The quarter included a one-time $31 million, or $0.63 per share, benefit from refunds of previously paid IEEPA tariffs.
- Free cash flow reached $218 million, compared with negative $32 million a year earlier. Results benefited from a $115 million U.S. federal tax refund, higher earnings and working-capital improvements.
- Network & Infrastructure Solutions revenue increased 9%, while Precision Power Solutions grew 24% on continued aerospace and defense strength. Industrial Mobility Solutions revenue declined 3% as weak material handling demand offset a transportation recovery.
- Fiscal Q1 orders increased 7% year over year, book-to-bill was 1.06 and backlog rose 2% sequentially. Data center orders increased more than 80%, with deliveries extending 12 to 36 months.
- For fiscal Q2 2027, management expects net sales of $955 million to $995 million and adjusted diluted EPS of $3.15 to $3.25, including $42 million to $47 million of 45X benefits.
Core Financial Data
| Metric | Fiscal Q1 2027 | Change / Commentary |
|---|---|---|
| Net sales | $936 million | Up 5% year over year |
| Gross profit | $313 million | Up 24% |
| Gross margin | 33.5% | Up 510 basis points |
| Gross margin excluding tariff refunds | — | Up 180 basis points year over year |
| Adjusted operating earnings | — | Up 47%; up 22% excluding tariff refunds |
| Adjusted operating margin | — | Up 550 basis points; up 220 basis points excluding tariff refunds |
| Adjusted EBITDA | — | Up 50%; up 27% excluding tariff refunds |
| Adjusted diluted EPS | — | Up 65%; up 36% excluding tariff refunds |
| Operating cash flow | $230 million | Supported by a $115 million federal tax refund and higher earnings |
| Capital expenditures | $12 million | Down from $33 million in fiscal Q1 2026 |
| Free cash flow | $218 million | Versus negative $32 million a year earlier |
| Cash and cash equivalents | $531 million | As of July 5, 2026 |
| Net debt | $522 million | Down more than $160 million from fiscal 2026 year-end |
| Leverage ratio | 0.8x EBITDA | Below the company’s target range |
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