Advanced Drain (WMS) Reports Decrease in Net Income

By Hao Liu • Thursday, May 15 10:09 • Permanent Link

Advanced Drainage Systems, Inc. (NYSE: WMS) has reported its financial results for the fourth quarter and fiscal year ended March 31, 2025. The company's net sales for the fourth quarter decreased by 5.8% to $615.8 million, while net income decreased by 19.6% to $76.8 million. Diluted net income per share also decreased by 18.2% to $0.99, and adjusted EBITDA (non-GAAP) decreased by 7.6% to $176.7 million.

For the fiscal year 2025, net sales increased by 1.0% to $2,904.2 million, but net income decreased by 11.8% to $452.6 million. Diluted net income per share decreased by 10.7% to $5.76, and adjusted EBITDA (non-GAAP) decreased by 3.7% to $889.2 million. Cash provided by operating activities decreased by $136.4 million to $581.5 million, and free cash flow (non-GAAP) decreased by $165.6 million to $368.5 million.

The company's president and CEO, Scott Barbour, commented that in fiscal 2025, domestic construction market sales increased by 3%, with organic sales in the most profitable segments, infiltrator and allied products, growing by 4.6% and 2.5%, respectively. However, in the fourth quarter, net sales decreased by 6% due to higher interest rates, economic uncertainty, and unfavorable winter weather conditions.

Looking ahead to fiscal 2026, the company expects net sales to be in the range of $2.825 billion to $2.975 billion, with adjusted EBITDA expected to be in the range of $850 million to $910 million. Capital expenditures are expected to be approximately $275 million.

In terms of liquidity, the company reported net debt of $962.3 million as of March 31, 2025, indicating an increase of $101.4 million from the previous year. The company also had total liquidity of $1.1 billion, comprised of cash of $463.3 million and $590.6 million of availability under committed credit facilities.

Overall, Advanced Drainage Systems, Inc. faced challenges in the fourth quarter of fiscal 2025, but it remains optimistic about its ability to drive profitable, above-market growth in the stormwater and onsite wastewater markets in the long term.

Following these announcements, the company's shares moved -1.51%, and are now trading at a price of $121.68. Check out the company's full 8-K submission here.

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