Sep 9, 2026 earnings call — Fire tender wins and margin recovery
Net sales were $50.1 million and adjusted EBITDA excluding FX rose to $2.7 million, driven by Fire growth and margin improvement.
Revenue $0.1B (est $0.1B) · EPS $-0.50 (est $-0.06)
Key quotes
"We secured multiple tender and contract awards across 9 countries globally, spanning Fire, disaster response, law enforcement, industrial and utility markets."
"An important note on margins: excluding the net tariff benefit of $1.4 million, gross margin still showed a sequential improvement to 34%, up 280 basis points, demonstrating that margin improvement was structural and not solely attributable to the tariff refunds."
"On the Fire Services side, revenue grew 78% year-over-year, with our independent service provider business contributing $3.5 million in the quarter, and we are accelerating investment in that platform."
Analyst Q&A 4
Underlying gross margin run rate
Q (Mark Smith · Lake Street Capital): He asked how to think about gross margins in the second half, excluding the tariff refund. He wanted the underlying gross margin run rate going forward.
A: Management said the tariff refund should not significantly affect the second half. They said the normalized run rate was in the mid-30s and that margins should continue to improve in Q3 and Q4 as higher-margin Fire and turnout gear grow.
Fire services growth and portfolio actions
Q (Mark Smith · Lake Street Capital): He asked about trends in the Fire Services business, revenue and margin, the capital needed to open new locations like Denver, and what portfolio or consolidation actions they are considering.
A: They said building a greenfield Fire location costs roughly $350,000 to $500,000 of capital. Denver is just opening and the greenfield size has worked well; they will focus on greenfield sites where demand exists. They are also reviewing geography and manufacturing footprints and expect meaningful portfolio changes in the next 6 months that should benefit fiscal '28.
"Yes. So building out a location, a greenfield, is roughly about $350,000 to $500,000 of capital." — James Jenkins (CEO·CHAIR)
Organic growth and quarter cadence
Q (Michael Shlisky · D. A. Davidson): He asked whether organic growth in Fire was about 10% after removing one-offs, and whether revenue should grow quarter-to-quarter into Q3 and Q4. He also asked about timing of tenders flowing to the bottom line.
A: They said they are seeing high single- to low double-digit organic growth in the fire business. They noted large tenders are lumpy (citing an Italian tender last year) and that some tenders start delivering sooner while others take longer, but they expect sequential growth from Q2 into Q3 and Q3 into Q4 based on pipeline and order flow. They described the U.K. opportunity as a 7-year scheme with substantial activity coming in the next 12 to 18 months.
"Yes, Mike. That's what we are seeing is the high single, low double-digit growth in the fire space organically." — J. Swinea (CFO)
Operating expenses and ISP capacity
Q (Gerard Sweeney · ROTH Capital Partners): He asked what SG&A or OpEx should run at, which OpEx items were one-time versus ongoing (Interschutz, expedited freight, ISP buildouts), and what ISP capacity and revenue potential looks like.
A: They said ISP build costs will be leveraged through revenue and that the Interschutz show is once every 5 years; expedited freight was temporary to position inventory and should go away as revenue supports it. Management said they need OpEx down to the mid to high 20s from about 32% this quarter, are looking at FX hedging and inventory moves in Argentina to address currency hits, and said single ISP facilities reach capacity around $2.5 million to $3.5 million but the business could reach roughly $5 million to $6 million per quarter with planned growth and new locations.
"I need to get it -- I need to get that into the mid to high 20s as opposed to the 30% where it is now, 32%, I think, this quarter." — James Jenkins (CEO·CHAIR)