Record 2025 performance was driven by a combination of higher production throughput, continued price realization, and meaningful contributions from recent acquisitions.
Management attributes the 110 basis point expansion in consolidated adjusted EBITDA margins to proactive price-cost management and improved manufacturing efficiencies.
The company is executing a ‘build-more-parts’ initiative to vertically integrate certain parts production, aiming to drive increased recurring parts revenue streams and expand margins over a multiyear timeline.
Strategic positioning has shifted the portfolio to be less backlog-intensive, with backlog-heavy products now representing 45% of sales compared to over 50% a decade ago.
The Safety and Security Systems Group achieved significant margin expansion through volume increases in public safety equipment and the realization of targeted cost savings.
Operational improvements in the Environmental Solutions Group were supported by better access to labor and the utilization of large-scale capacity expansions completed in prior years.
Full-year 2026 guidance assumes organic revenue growth of 5% to 9%, with the remainder of the 17% to 22% total growth target coming from New Way and MEGA acquisitions.
The New Way acquisition is expected to be adjusted EPS neutral in 2026 due to initial intangible asset amortization and industry normalization trends.
Management targets $15 million to $20 million in annual synergies from New Way by 2028, split evenly between operational cost savings and sales channel expansion.
Strategic focus in Canada involves phasing out third-party refuse truck sales in favor of higher-margin internal New Way products, expected to provide margin tailwinds starting in 2027.
Capital expenditure for 2026 is planned at $45 million to $55 million, with approximately half dedicated to growth-oriented productivity projects.
The company recognized $13.3 million in acquisition-related expenses in Q4, primarily driven by fair value adjustments for contingent consideration and New Way transaction costs.
A $0.16 per share headwind is anticipated in 2026 due to higher intangible asset amortization and the normalization of the corporate tax rate to approximately 25%.
Management is winding down an $80 million third-party refuse backlog over the next four quarters as part of the post-acquisition sales channel pivot.
The company replaced its $800 million credit facility with a new five-year agreement to provide enhanced liquidity for future M&A and organic investments.
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