8-K: EVI Industries Achieves Record FY25 Results, Boosts Dividend

EVI Industries, Inc. reported record financial results for fiscal year 2025, driven by strategic acquisitions, organic growth, and technological advancements, while also declaring a special cash dividend.

Summary

• EVI Industries achieved record financial results for the fiscal year ended June 30, 2025, with revenue increasing 10% to $390 million and net income rising 33% to $7.5 million.
• The company's long-term growth strategy, initiated in 2016, has resulted in compounded annual growth rates of 30% in revenue, 18% in net income, and 27% in adjusted EBITDA, alongside 31 acquisitions and 7% compounded annual organic revenue growth.
• During fiscal 2025, EVI completed four acquisitions, including Girbau North America (now Continental Laundry Solutions), which is the largest transaction in company history and is expected to add approximately $50 million in annual revenue.
• Significant investments were made in technology, with the field service platform expanding to 27 business units completing over 8,500 appointments in June 2025, and 28 of 31 business units operating on the end-state ERP platform.
• EVI's Board of Directors declared a special cash dividend of $0.33 per share, payable on October 6, 2025, to shareholders of record as of September 25, 2025, totaling approximately $4.9 million.
• Operating cash flow for fiscal 2025 was $21.3 million, a decline from the prior year, primarily due to increased investment in working capital, including higher inventory ($66.1 million) and accounts receivable ($60.5 million) balances.
• Net debt increased to $44.1 million as of June 30, 2025, reflecting ongoing investments in acquisitions, technology, and working capital.

Sentiment

Score: 9

Explanation: The filing reports record financial results across multiple key metrics for both the fiscal year and the fourth quarter, driven by successful strategic acquisitions and significant technology investments. The declaration of a special cash dividend further underscores strong performance and shareholder value creation, despite a decline in operating cash flow attributed to strategic working capital investments.

Positives

• Fiscal year 2025 revenue increased 10% to a record $390 million.
• Fiscal year 2025 gross profit increased 12% to a record $118 million, representing a record 30.4% margin.
• Fiscal year 2025 operating income increased 18% to $13.8 million.
• Fiscal year 2025 net income increased 33% to $7.5 million.
• Fiscal year 2025 adjusted EBITDA increased 11% to $25.0 million, or 6.4%.
• The three-year compounded annual growth rate (CAGR) in organic revenue was 7%.
• Fourth quarter 2025 revenue increased 22% to a record $110 million.
• Fourth quarter 2025 gross profit increased 24% to a record $33.9 million, representing a record 30.8% margin.
• Fourth quarter 2025 operating income increased 13% to a record $4.1 million.
• Fourth quarter 2025 adjusted EBITDA increased 17% to a record $7.2 million, or 6.5%.
• Successfully completed four acquisitions in fiscal 2025, including the largest in company history, Girbau North America (Continental Laundry Solutions), expected to add $50 million in annual revenue.
• Expanded geographic footprint, modernized systems, and commitment to innovation position the company for greater value delivery.
• Strong demand across distribution and service network, supported by favorable conditions in healthcare, hospitality, and vended laundry end markets.
• Expanded sales and technical workforce and a solid backlog of confirmed customer orders provide momentum for sustained growth.
• Significant strides in technology adoption, with the field service platform expanding to 27 business units and 28 of 31 business units operating on the end-state ERP platform.
• Declared a special cash dividend of $0.33 per share, reflecting strong fiscal 2025 results and disciplined capital structure.

Negatives

• Operating cash flow of $21.3 million was lower than the prior year ($32.65 million), primarily due to increased investment in working capital.
• Net debt increased to $44.1 million as of June 30, 2025, from $8.3 million as of June 30, 2024, reflecting ongoing investments.

Risks

• General economic and business conditions in the United States and other countries where the company operates.
• Economic uncertainty, including governmental measures like tariffs, global trading markets, credit markets, and the potential for a recession.
• Supply chain delays and disruptions impacting the ability to deliver products and services on time.
• Inflation and other price increases, including the inability to successfully increase product and service prices to offset costs, potentially leading to reduced demand.
• Interest rate increases and their impact on the cost of indebtedness and the ability to raise capital.
• International relations and hostilities and their impact on economic conditions.
• Ability to implement business and growth strategies and plans, including changes thereto.
• Risks associated with the buy-and-build growth strategy, such as difficulty identifying or consummating acquisitions, integration risks, indebtedness, dilution, and failure to meet anticipated benefits of acquisitions.
• Investments, initiatives, and expenses, including those in acquired businesses and strategic technology initiatives, may not result in anticipated benefits.
• Risks relating to the planned e-commerce platform, including potential delays in launch and the risk that it may not perform or positively impact results as anticipated.
• Measures taken for expansion and market share growth may not be successful and could adversely impact gross margin and other financial results.
• Technology changes and competition, including the ability to compete effectively and its impact on pricing, profit margins, and competition for qualified employees.
• Risks relating to relationships with principal suppliers and customers, including the impact of losing any such relationship.
• Risks related to indebtedness, including that availability under the credit facility is subject to its terms and conditions.
• The availability, terms, and deployment of debt and equity capital if needed for expansion or otherwise.
• Risks of cybersecurity threats or incidents, including potential misappropriation of assets or confidential information, data corruption, or operational disruptions.
• The risk that orders in the company's backlog may not be fulfilled as or when expected.
• Dividends may not be paid in the future.

Future Outlook

The company expects to continue executing its long-term strategy, advancing key initiatives with a focus on growth, innovation, and achieving operating leverage. It remains committed to disciplined execution to deliver sustained value for customers and shareholders. A new e-commerce platform is expected to launch in fiscal 2026, aiming to redefine the customer experience and provide 24/7 ordering convenience.

Management Comments

• "Fiscal 2025 was a defining year for our Company. We delivered record financial results, successfully completed the Companys largest acquisition, and made meaningful progress on our technology roadmap. We believe that our expanded geographic footprint, modernized systems, and commitment to innovation position us to deliver even greater value to customers and shareholders in the years ahead."
• "Our success in acquisitions extends beyond financial resultsits built on people, culture, and trust. We take great pride in how we engage with business owners and their teams, striving to honor their legacies and provide their employees with meaningful opportunities to grow within our organization. We believe that this approach has earned us a reputation as the acquirer of choice in the commercial laundry industry, with owners of target companies excited to become part of a value-driven company with a strong track record, a growth-oriented culture, and a deep commitment to customer success. We expect that this reputation will continue to open doors and fuel our long-term buy-and-build strategy."
• "We will continue to execute on our long-term strategy and advance our key initiatives with a focus on growth, innovation, and achieving operating leverage. We remain committed to disciplined execution, building on our strong foundation and proven model to deliver sustained value for customers and shareholders."

Industry Context

EVI Industries operates as a leader in the highly fragmented North American commercial laundry distribution and service industry. The company's strong performance is supported by resilient demand across key end markets, including healthcare, hospitality, and the vended laundry industry, which continue to show robust demand for commercial laundry products and services. The strategic acquisitions and technology investments aim to further consolidate its market position and enhance competitive advantage.

Stakeholder Impact

• Shareholders: Benefit from record financial performance, increased shareholder value, and a special cash dividend of $0.33 per share.
• Customers: Expected to benefit from an expanded geographic footprint, enhanced service capabilities, a broader product portfolio, modernized technology systems, and a planned e-commerce platform for improved convenience and service.
• Employees: Employees of acquired businesses are provided with opportunities to grow within the organization, and the company has expanded its sales and technical workforce.
• Suppliers/OEM Partners: Continental Laundry Solutions will serve as a master distributor, potentially offering new channels for growth and improved purchasing power. The company also collaborates with suppliers on shared cost strategies to mitigate tariff impacts.

Next Steps

• Continue to execute on the long-term growth strategy.
• Advance key initiatives focused on growth, innovation, and achieving operating leverage.
• Scale technology initiatives across the enterprise to support operating margin goals and continued growth.
• Launch a planned e-commerce platform in fiscal 2026 to enhance customer experience and operational efficiency.
• Leverage Continental Laundry Solutions as a master distributor for OEMs and develop it into a strategic sourcing division.

Key Dates

Recommendation

EVI Industries demonstrates exceptional financial performance with record revenues, gross profit, operating income, net income, and Adjusted EBITDA for fiscal year 2025. The company's 'buy-and-build' strategy is proving highly effective, evidenced by 31 acquisitions since 2016 and a 7% organic revenue CAGR, culminating in the largest acquisition in its history this year. Significant investments in technology, including ERP and field service platforms, are modernizing operations and enhancing customer experience, positioning the company for future efficiency and growth. The declaration of a special cash dividend signals confidence in financial health and a commitment to shareholder returns. While operating cash flow saw a temporary dip due to strategic working capital investments, the overall trajectory and strategic execution suggest strong continued growth and market leadership in a resilient industry.

Keywords

EVI Industries, Commercial Laundry, Distribution, Acquisitions, Organic Growth, Financial Results, EBITDA, Dividends, Technology Investment, ERP Platform, E-commerce, Supply Chain, Tariffs, Healthcare, Hospitality, Vended Laundry