RBC Bearings Incorporated’s (RBC Quick QuoteRBC - Free Report) second-quarter fiscal 2025 (ended September 2024) adjusted earnings of $2.29 per share narrowly missed the Zacks Consensus Estimate of $2.30.

The figure increased 5.1% from year-ago adjusted earnings of $2.17 per share, supported by higher revenues. Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

RBC’s Revenue Details

RBC Bearings’ revenues were $397.9 million, which increased 3.2% year over year. However, the figure missed the Zacks Consensus Estimate of $401 million.

While exiting the fiscal second quarter, RBC had a backlog of $864 million compared with $825.8 million reported at the end of the first quarter of fiscal 2025 (ended June 30, 2024).

Segmental Details

The company currently has two reportable segments, namely Aerospace/Defense and Industrial. Its segmental performance for the fiscal second quarter is briefly discussed below:

Industrial revenues of $254.7 million (representing 64% of the quarter’s revenues) were down 1.4% year over year.

Aerospace/Defense revenues totaled $143.2 million (36%), up 12.5% year over year.

RBC’s Margin Profile

The company’s cost of sales rose 2.2% year over year to $224.1 million. Gross profit grew 4.5% to $173.8 million. The margin expanded 60 basis points (bps) to 43.7%.

Selling, general and administrative (SG&A) expenses were $69.5 million, up 14.9% year over year. Adjusted EBITDA inched up 1.1% to $123.4 million. The adjusted EBITDA margin was 31%, down 70 bps year over year.

Adjusted operating income decreased 2% year over year to $86.6 million. The adjusted margin decreased 110 bps to 21.8%. Net interest expenses were $15.6 million compared with $20.1 million in the year-ago quarter.

Balance Sheet & Cash Flow

At the time of exiting the fiscal second quarter, RBC had cash and cash equivalents of $89.1 million compared with $63.5 million at the end of the fiscal 2024. Long-term debt (less current portion) was $1.10 billion, down from $1.19 billion at the end of the fiscal 2024.

In the first six months of fiscal 2025, the company generated net cash of $140.4 million from operating activities, which increased 22.3% on a year-over-year basis. Capital expenditure of $25.2 million increased 77.5% year over year.

In the first six months of fiscal 2025, RBC Bearings repurchased shares worth $8.4 million, up 20% year over year.

RBC Bearings’ Outlook

For the fiscal third quarter, management anticipates net sales to be in the range of $390-$400 million, indicating an increase from the year-ago quarter reported figure of $386 million.

The gross margin is expected to be in the range of 42.50-43.50%, while SG&A (as a percentage of sales) is projected to be in the band of 17.0-17.5%.

Zacks Rank & Key Picks

RBC currently carries a Zacks Rank #3 (Hold).

Here are some better-ranked stocks from the same space:

Crane Company (CR Quick QuoteCR - Free Report) currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

CR delivered a trailing four-quarter average earnings surprise of 7.6%. In the past 60 days, the Zacks Consensus Estimate for Crane’s 2024 earnings has increased 1%.

Ingersoll-Rand plc (IR Quick QuoteIR - Free Report) presently carries a Zacks Rank of 2. IR delivered a trailing four-quarter average earnings surprise of 9.1%.

In the past 60 days, the consensus estimate for Ingersoll-Rand’s 2024 earnings has inched up 0.6%.

Parker-Hannifin Corporation (PH Quick QuotePH - Free Report) currently carries a Zacks Rank of 2. PH delivered a trailing four-quarter average earnings surprise of 8.5%.

In the past 60 days, the consensus estimate for Parker-Hannifin’s fiscal 2025 (ending June 2025) earnings has increased 0.6%.