Aug 13, 2026 earnings call — Helvoet deal pushes Medical CDMO focus
Company projects fiscal 2027 net sales of $1.535 billion to $1.56 billion, driven by organic growth and $60 million from Helvoet.
Revenue $0.4B (est $0.4B) · EPS $-0.01 (est $0.39) · Next-quarter revenue outlook $1.5B–$1.6B
Key quotes
"As I noted in my opening comments, our guidance implies medical will approach 35% of the total company in fiscal '27."
"Since the deal announcement in early July, the integration efforts have gone very well with our #1 priority focused on unlocking top line synergies."
"we generated strong cash from operations, which was used to pay down debt to its lowest level in over 4 years."
Analyst Q&A 5
Medical sales and Indianapolis facility impact
Q (Brett Fishbin · KeyBanc): The analyst asked for more detail on the Medical segment this quarter by region, and how North America compared. He also asked how much of the expected high single-digit to low double-digit Medical growth in FY '27 might come from the new Indianapolis facility and other contributors.
A: Management said Medical continued the year's positive trend and showed double-digit increases after including Helvoet, which closed July 1. They said Indy will start production by the end of the calendar year but will mainly transfer existing work at first, so they do not expect a big incremental impact in FY '27. Jana also said FX will affect Helvoet revenue and that going from $56 million to $60 million-ish still implies about 8% growth.
"I wouldn't expect you'll see a big impact in '27 from Indianapolis just because new programs take time to ramp." — Richard Phillips (CEO)
Q4 EBITDA, Indy facility drag, leverage
Q (Michael Crawford · B. Riley): He asked what Q4 EBITDA and EBITDA margin were, how big the Indianapolis ramp drag is and whether there will be drag next fiscal year, and what leverage and capital allocation priorities the company prefers.
A: Jana said Q4 EBITDA was $28.2 million and EBITDA margin was 7.6%. She said the Indianapolis drag is closer to $6.5 million, $7 million all in and there will still be a drag into FY '28 because the facility already carries costs until it produces revenue; production will start in the fourth quarter of the calendar year (the company’s second fiscal quarter) and new programs take about 18 months to ramp from roughly December. On capital structure, management said somewhere between 1.5 and 2x feels good, they will pay down acquisition cost with operating cash and repatriation, keep $50 million organic CapEx, continue share repurchases, and would consider short-lived leverage above 3x for the right inorganic deal.
"Somewhere between 1.5 and 2x feels good for our business, but you need to keep your balance sheet strong enough when incremental growth opportunities that are inorganic present themselves, you've got the dry powder to act." — Jana Croom (CFO)
Automotive sales and cash conversion days
Q (Derek Soderberg · Cantor Fitzgerald): He asked when Automotive will turn positive and how regions and subsegments drive that outlook. He also asked if the 82-day cash conversion is sustainable as growth accelerates.
A: Richard said Automotive decline was driven by lower-than-expected volumes on EV programs the company won, not lost programs; Europe is strong and newer programs are ramping, China is competitive, and they expect stabilization and eventual return to growth. Jana said 82 days was hard-earned but they now see some inventory pressure from customers and "golden screw" events, so they plan for working capital to rise a few days in FY '27.
"The decline is really, as I mentioned earlier on the call, has been driven by low demand for EV programs that we won." — Richard Phillips (CEO)
Gross margin target and revenue timing
Q (Maxwell Michaelis · Lake Street): He asked whether gross margins should stay above the recent 8.9% and what level is needed to hit guidance, and whether revenue will be balanced quarter-to-quarter in 2027.
A: Jana said S&A is trending around the 4% range and, using the guide midpoint near 4.5, the company would need a gross margin in the range of 8.5% for the math to work. She also said the company expects revenue to be fairly even across quarters next year.
"And so if you consider the midpoint of the guide that we put out being like, call it, 4.5-ish, you would need a gross margin in the range of 8.5% for that math to work." — Jana Croom (CFO)
Euro rate, capital plans, Helvoet integration
Q (Sidoti & Company): They asked what euro rate assumption underpins the 2027 guide now that Helvoet adds euro revenue, how the company thinks about pro forma capital allocation and target leverage, and whether there have been any surprises since closing Helvoet on July 1.
A: Jana said the euro assumption is $1.14. She said a leverage level somewhere in the 1.5 range feels good, and they want enough dry powder to pursue tuck-in acquisitions while investing in the core business. Richard said integration and customer conversations have been positive so far, they plan to keep Helvoet’s footprint, teams are engaged, and top-line synergy opportunities are encouraging though timing and size are still being worked out.
"We have a master integration plan that we're on track for." — Richard Phillips (CEO)