VSE Corporation Announces Third Quarter 2026 Results
Repair revenue increased 197.6% year over year, while distribution revenue rose 26.7%.
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Record Revenue and Profitability
Raises 2026 Guidance
THIRD QUARTER 2026 RESULTS(1)
(As compared to the Third Quarter 2025)
-
Total Revenues of
$541.0 million 91.2% -
GAAP Net Income of
$47.3 million 216.2% -
GAAP Net Income Margin of
8.7% increased approximately 750 basis points -
GAAP EPS (Diluted)(2) of
$1.49 776.5% -
Adjusted EBITDA(3) of
$107.2 million 126.3% -
Adjusted EBITDA Margin(3) of
19.8% increased approximately 310 basis points -
Adjusted Net Income(3) of
$63.8 million 128.4% -
Adjusted EPS (Diluted)(2)(3) of
$2.01 48.9%
1 All numbers above reflect results from continuing operations. |
2 Percentage changes in earnings per share throughout this release are calculated using the rounded per-share amounts presented. |
3 Non-GAAP measure. See additional information at the end of this release regarding non-GAAP financial measures. |
MANAGEMENT COMMENTARY
“VSE delivered an exceptional third quarter, achieving record revenue and profitability, approximately
“During the quarter, we expanded our proprietary engine repair capabilities through the acquisition of Atech Turbine Components (“Atech”) and advanced integration across the VSE and Precision Aviation Group (“PAG”) businesses. Our teams are pursuing joint commercial opportunities, bringing more repair work in-house, and improving operational efficiency across the combined platform. These efforts deepen our OEM partnerships, expand our addressable markets, broaden the solutions we offer customers, and support margin expansion.
“We see substantial opportunity ahead. Our engine-focused repair and parts portfolio, strong OEM relationships, and diversified end markets position us to build on this quarter’s performance. With a deep pipeline of organic growth opportunities and meaningful expected acquisition synergies ahead, we remain focused on delivering above-market growth, further margin expansion, and stronger free cash flow(3) generation. We believe these priorities position VSE to deliver significant long-term value for our shareholders,” concluded Mr. Cuomo.
“VSE’s record third quarter results demonstrate the earnings power and cash generation of the combined VSE and PAG platform,” said Adam Cohn, Chief Financial Officer of VSE Corporation. “Revenue increased
THIRD QUARTER HIGHLIGHTS
ATECH TURBINE COMPONENTS ACQUISITION
On August 31, 2026, VSE acquired Atech, a specialized maintenance, repair and overhaul (“MRO”) provider focused on complex hot-section components for aircraft turbine engines, primarily supporting Pratt & Whitney Canada platforms. Atech expands VSE’s proprietary, OEM-approved engine repair portfolio with repair approvals covering more than 300 part numbers, including sole-source repairs for flight-critical components. The acquisition deepens VSE’s relationship with Pratt & Whitney Canada and broadens the aftermarket solutions available to OEM partners and customers. VSE plans to expand Atech’s capacity and technical capabilities to accelerate the development of new proprietary repairs and support long-term organic growth.
THIRD QUARTER REVIEW
The Company's revenue increased
Net income from continuing operations was
FINANCIAL RESOURCES AND LIQUIDITY
The Company generated
UPDATED FULL YEAR 2026 CONSOLIDATED GUIDANCE
REVENUE
VSE now expects full year 2026 revenue growth of
ADJUSTED EBITDA MARGIN(3)
VSE now expects full year 2026 Adjusted EBITDA margin(3) of
3 Non-GAAP measure. See additional information at the end of this release regarding non-GAAP financial measures and the Company's inability to provide quantitative reconciliations of forward-looking Adjusted EBITDA margin. |
SUMMARY OF THIRD QUARTER RESULTS
|
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|
|
|
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||||||
|
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Three months ended September 30, |
|
Nine months ended September 30, |
||||||||||||||
(in thousands, except per share data) |
|
2026 |
|
2025 |
|
% Change |
|
2026 |
|
2025 |
|
% Change |
||||||
Revenues |
|
$ |
541,006 |
|
$ |
282,909 |
|
91.2 |
% |
|
$ |
1,314,723 |
|
$ |
811,093 |
|
62.1 |
% |
Operating income |
|
$ |
77,451 |
|
$ |
10,087 |
|
667.8 |
% |
|
$ |
159,157 |
|
$ |
57,104 |
|
178.7 |
% |
Net income from continuing operations |
|
$ |
47,264 |
|
$ |
3,591 |
|
1,216.2 |
% |
|
$ |
104,842 |
|
$ |
31,197 |
|
236.1 |
% |
EPS (Diluted) |
|
$ |
1.49 |
|
$ |
0.17 |
|
776.5 |
% |
|
$ |
3.45 |
|
$ |
1.50 |
|
130.0 |
% |
NON-GAAP MEASURES
In addition to the financial measures prepared in accordance with
VSE considers Adjusted Net Income from continuing operations, Adjusted EPS (Diluted) from continuing operations, EBITDA from continuing operations, Adjusted EBITDA from continuing operations, Adjusted EBITDA margin from continuing operations, Trailing Twelve Months ("TTM") Adjusted EBITDA from continuing operations, TTM Acquisition Adjusted EBITDA from continuing operations, organic revenue growth, net debt, net leverage ratio, Adjusted net leverage ratio, and free cash flow as non-GAAP financial measures and important indicators of performance and useful metrics for management and investors to evaluate VSE’s ongoing operating performance on a consistent basis across reporting periods. These non-GAAP financial measures, however, should not be considered in isolation or as a substitute for performance measures prepared in accordance with GAAP. Adjusted Net Income from continuing operations represents net income from continuing operations adjusted for acquisition, integration and restructuring costs, amortization of intangible assets, stock-based compensation, other discrete items, and their related tax impact, which was calculated using an estimated statutory tax rate of
Additionally, Adjusted EBITDA margin is presented as a forward-looking non-GAAP financial measure. This measure is based solely on information available to VSE as of the date of this earnings release and may differ materially from VSE’s actual operating results as a result of developments that occur after the date of this earnings release. The determination of the amounts that are excluded from this non-GAAP financial measure is a matter of management judgment and depends upon, among other factors, the nature of the underlying expense, income amounts or anticipated synergies recognized in a given period. VSE is unable to present a quantitative reconciliation of forward-looking Adjusted EBITDA margin because certain information regarding the Company’s provision for income taxes is not available, and management cannot reliably predict all of the necessary components of net income at this time without unreasonable effort or expense. For the same reasons, the Company is unable to address the probable significance of the unavailable information. The unavailable information could have a significant impact on the Company’s future financial results.
NON-GAAP FINANCIAL INFORMATION
Adjusted Net Income from Continuing Operations and Adjusted EPS from Continuing Operations
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
||||||||||||||||||
(in thousands, except per share data) |
2026 |
|
2025 |
|
% Change |
|
2026 |
|
2025 |
|
% Change |
|||||||||||
Net income from continuing operations |
$ |
47,264 |
|
|
$ |
3,591 |
|
|
1,216.2 |
% |
|
$ |
104,842 |
|
|
$ |
31,197 |
|
|
236.1 |
% |
|
Adjustments to net income from continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Acquisition, integration and restructuring costs |
|
4,059 |
|
|
|
732 |
|
|
454.5 |
% |
|
|
18,431 |
|
|
|
5,429 |
|
|
239.5 |
% |
|
Divestiture-related restructuring (benefits) costs (1) |
|
— |
|
|
|
(204 |
) |
|
(100.0 |
)% |
|
|
68 |
|
|
|
291 |
|
|
(76.6 |
)% |
|
Interest income on note receivable |
|
(702 |
) |
|
|
(1,342 |
) |
|
(47.7 |
)% |
|
|
(2,084 |
) |
|
|
(1,342 |
) |
|
55.3 |
% |
|
Earn-out fair value adjustments |
|
(8,880 |
) |
|
|
23,300 |
|
|
NM |
|
|
|
(8,880 |
) |
|
|
29,200 |
|
|
NM |
|
|
Loss on debt extinguishment |
|
— |
|
|
|
— |
|
|
— |
% |
|
|
4,473 |
|
|
|
— |
|
|
— |
% |
|
Debt issuance costs |
|
— |
|
|
|
— |
|
|
— |
% |
|
|
— |
|
|
|
491 |
|
|
(100.0 |
)% |
|
Amortization of intangible assets |
|
23,095 |
|
|
|
6,687 |
|
|
245.4 |
% |
|
|
50,595 |
|
|
|
19,308 |
|
|
162.0 |
% |
|
Stock-based compensation |
|
4,405 |
|
|
|
3,245 |
|
|
35.7 |
% |
|
|
12,992 |
|
|
|
10,133 |
|
|
28.2 |
% |
|
|
69,241 |
|
|
|
36,009 |
|
|
92.3 |
% |
|
|
180,437 |
|
|
|
94,707 |
|
|
90.5 |
% |
|
|
Tax impact of adjusted items (2) |
|
(5,483 |
) |
|
|
(8,088 |
) |
|
(32.2 |
)% |
|
|
(18,861 |
) |
|
|
(15,846 |
) |
|
19.0 |
% |
Adjusted net income from continuing operations |
$ |
63,758 |
|
|
$ |
27,921 |
|
|
128.4 |
% |
|
$ |
161,576 |
|
|
$ |
78,861 |
|
|
104.9 |
% |
|
Weighted average dilutive shares |
|
31,790 |
|
|
|
20,757 |
|
|
53.2 |
% |
|
|
30,351 |
|
|
|
20,743 |
|
|
46.3 |
% |
|
GAAP EPS (Diluted) |
$ |
1.49 |
|
|
$ |
0.17 |
|
|
776.5 |
% |
|
$ |
3.45 |
|
|
$ |
1.50 |
|
|
130.0 |
% |
|
Adjusted EPS (Diluted) from continuing operations |
$ |
2.01 |
|
|
$ |
1.35 |
|
|
48.9 |
% |
|
$ |
5.32 |
|
|
$ |
3.80 |
|
|
40.0 |
% |
|
(1) Activity for the three months ended September 30, 2025 includes business insurance credits following the Fleet sale. |
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(2) The tax impact of adjusted items was calculated using an estimated statutory tax rate. |
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NM = Not meaningful |
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EBITDA from Continuing Operations and Adjusted EBITDA from Continuing Operations
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
||||||||||||||||||
(in thousands) |
2026 |
|
2025 |
|
Change |
|
2026 |
|
2025 |
|
Change |
|||||||||||
Net income from continuing operations |
$ |
47,264 |
|
|
$ |
3,591 |
|
|
1,216.2 |
% |
|
$ |
104,842 |
|
|
$ |
31,197 |
|
|
236.1 |
% |
|
|
Interest expense, net |
|
14,097 |
|
|
|
4,339 |
|
|
224.9 |
% |
|
|
17,925 |
|
|
|
18,723 |
|
|
(4.3 |
)% |
|
Provision for income taxes |
|
16,090 |
|
|
|
2,157 |
|
|
645.9 |
% |
|
|
31,917 |
|
|
|
7,184 |
|
|
344.3 |
% |
|
Amortization of intangible assets |
|
23,095 |
|
|
|
6,687 |
|
|
245.4 |
% |
|
|
50,595 |
|
|
|
19,308 |
|
|
162.0 |
% |
|
Depreciation and other amortization |
|
7,035 |
|
|
|
3,504 |
|
|
100.8 |
% |
|
|
16,256 |
|
|
|
9,691 |
|
|
67.7 |
% |
EBITDA from continuing operations |
|
107,581 |
|
|
|
20,278 |
|
|
430.5 |
% |
|
|
221,535 |
|
|
|
86,103 |
|
|
157.3 |
% |
|
|
Acquisition, integration and restructuring costs |
|
4,059 |
|
|
|
732 |
|
|
454.5 |
% |
|
|
18,431 |
|
|
|
5,429 |
|
|
239.5 |
% |
|
Divestiture-related restructuring (benefits) costs (1) |
|
— |
|
|
|
(204 |
) |
|
(100.0 |
)% |
|
|
68 |
|
|
|
291 |
|
|
(76.6 |
)% |
|
Earn-out fair value adjustments |
|
(8,880 |
) |
|
|
23,300 |
|
|
NM |
|
|
|
(8,880 |
) |
|
|
29,200 |
|
|
NM |
|
|
Loss on debt extinguishment |
|
— |
|
|
|
— |
|
|
— |
% |
|
|
4,473 |
|
|
|
— |
|
|
— |
% |
|
Stock-based compensation |
|
4,405 |
|
|
|
3,245 |
|
|
35.7 |
% |
|
|
12,992 |
|
|
|
10,133 |
|
|
28.2 |
% |
Adjusted EBITDA from continuing operations |
$ |
107,165 |
|
|
$ |
47,351 |
|
|
126.3 |
% |
|
$ |
248,619 |
|
|
$ |
131,156 |
|
|
89.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income margin from continuing operations |
|
8.7 |
% |
|
|
1.3 |
% |
|
~ 750 bps |
|
|
8.0 |
% |
|
|
3.8 |
% |
|
~ 410 bps |
|||
Adjusted EBITDA margin from continuing operations |
|
19.8 |
% |
|
|
16.7 |
% |
|
~ 310 bps |
|
|
18.9 |
% |
|
|
16.2 |
% |
|
~ 270 bps |
|||
(1) Activity for the three months ended September 30, 2025 includes business insurance credits following the Fleet sale. |
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Basis point (bps) change may not visually recalculate due to rounding. |
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Free Cash Flow (1)
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
||||||||||||
(in thousands) |
|
2026 |
|
2025 |
|
2026 |
|
2025 |
||||||||
Net cash provided by (used in) operating activities |
|
$ |
55,991 |
|
|
$ |
24,089 |
|
|
$ |
21,284 |
|
|
$ |
(10,652 |
) |
Capital expenditures |
|
|
(9,372 |
) |
|
|
(6,049 |
) |
|
|
(24,699 |
) |
|
|
(14,513 |
) |
Free cash flow |
|
$ |
46,619 |
|
|
$ |
18,040 |
|
|
$ |
(3,415 |
) |
|
$ |
(25,165 |
) |
(1) Amounts include the results of both continuing and discontinued operations for the three and nine months ended September 30, 2025. |
||||||||||||||||
Net Debt
(in thousands) |
September 30, 2026 |
|
December 31, 2025 |
||||
Principal amount of debt |
$ |
978,793 |
|
|
$ |
296,250 |
|
Debt issuance costs |
|
(18,854 |
) |
|
|
(3,446 |
) |
Cash and cash equivalents |
|
(65,786 |
) |
|
|
(69,358 |
) |
Net Debt |
$ |
894,153 |
|
|
$ |
223,446 |
|
Net Leverage Ratio
($ in thousands) |
September 30, 2026 |
|
December 31, 2025 |
||||
Net Debt |
$ |
894,153 |
|
$ |
223,446 |
||
TTM Adjusted EBITDA from continuing operations (1) |
$ |
300,387 |
|
$ |
182,924 |
||
Net Leverage Ratio |
3.0 |
x |
|
1.2 |
x |
||
|
|
|
|
||||
TTM Acquisition Adjusted EBITDA from continuing operations (2) |
$ |
389,234 |
|
$ |
209,128 |
||
Adjusted Net Leverage Ratio |
2.3 |
x |
|
1.1 |
x | ||
(1) TTM Adjusted EBITDA from continuing operations is defined as Adjusted EBITDA from continuing operations for the most recent twelve (12) month period. |
|||||||
(2) TTM Acquisition Adjusted EBITDA from continuing operations includes pre-acquisition portion of EBITDA for the trailing twelve months that is not included in historical results. |
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CONFERENCE CALL
A conference call will be held Thursday, November 5, 2026 at 8:30 A.M. ET to review the Company’s financial results, discuss recent events and conduct a question-and-answer session.
An audio webcast of the conference call and accompanying presentation materials will be available in the Investor Relations section of VSE’s website at https://ir.vsecorp.com. To listen to the live broadcast, go to the site at least 15 minutes prior to the scheduled start time to register, download and install any necessary audio software. A replay of the audio webcast will be available at the same location following the conclusion of the call.
ABOUT VSE CORPORATION
VSE is a diversified aftermarket products and services company serving commercial and government markets. Headquartered in
Please refer to the Form 10-Q that will be filed with the Securities and Exchange Commission ("SEC") on or about November 5, 2026 for more details on the Company's third quarter 2026 results. Also, refer to VSE’s Annual Report on Form 10-K for the year ended December 31, 2025 for further information and analysis of VSE’s financial condition and results of operations. VSE encourages investors and others to review the detailed reporting and disclosures contained in VSE’s public filings for additional discussion about the status of customer programs and contract awards, risks, revenue sources and funding, dependence on material customers, and management’s discussion of short- and long-term business challenges and opportunities.
FORWARD LOOKING STATEMENTS
This document contains statements that, to the extent they are not recitations of historical fact, constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All such statements are intended to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and this statement is included for purposes of such safe harbor provisions.
“Forward-looking” statements, as such term is defined by the Securities and Exchange Commission (the “SEC”) in its rules, regulations and releases, represent VSE’s expectations or beliefs, including, but not limited to, statements concerning the expected financial and other benefits of the acquisition of PAG, VSE’s operations, economic performance, financial condition, growth and acquisition strategies, investments and future operational plans. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “forecast,” “seek,” “plan,” “predict,” “project,” “could,” “estimate,” “might,” “continue,” “seeking” or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements.
These statements speak only as of the date of this document and VSE undertakes no ongoing obligation, other than that imposed by law, to update these statements as a result of new information, future events or otherwise. These statements relate to, among other things, VSE’s future financial condition, results of operations or prospects; VSE’s business and growth strategies; and VSE’s financing plans and forecasts. You are cautioned that any such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, certain of which are beyond VSE’s control, and that actual results may differ materially from those contained in or implied by the forward-looking statements as a result of various factors, some of which are unknown, including, without limitation, risks related to:
- the performance of the aviation aftermarket;
- global economic and political conditions;
- supply chain delays and disruptions;
- competition from existing and new competitors;
- losses related to investments in inventory and facilities;
- interruptions in the Company's operations;
- challenges related to workforce management or any failure to attract or retain a skilled workforce;
- the significant expenses that have been incurred and will be incurred in connection with the acquisition of PAG;
- the Company's ability to successfully integrate and achieve the strategic and other objectives and benefits, including any expected synergies, relating to recently completed acquisitions, including the acquisition of PAG;
- access to and the performance of third-party package delivery companies;
- prolonged periods of inflation and the Company's ability to mitigate the impact thereof;
- future business conditions resulting in impairments;
- the Company's ability to successfully divest businesses and to transition facilities in connection therewith;
- the Company's work on large government programs;
- health epidemics, pandemics and similar outbreaks;
- compliance with government rules and regulations, including tariffs and environmental and pollution risk;
- the Company's ability to mitigate the impacts of increased costs related to tariffs;
- litigation and legal actions arising from the Company's operations;
- technology and cybersecurity threats and incidents;
- the Company's outstanding indebtedness;
- market volatility in the debt and equity capital markets;
- the Company's ability to continue to pay dividends at current levels or at all;
- the Company's published financial guidance;
- restrictions and limitations that may stem from financing arrangements the Company enters into or assumes in the future; and
- the other factors identified in the Company's reports filed or expected to be filed with the SEC, including the Company's Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on February 27, 2026.
You are advised, however, to consult any further disclosures VSE makes on related subjects in VSE’s periodic reports on Forms 10-K, 10-Q or 8-K filed with or furnished to the SEC.
VSE Corporation and Subsidiaries |
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Unaudited Consolidated Balance Sheets |
||||||
(in thousands except share and per share amounts) |
||||||
|
|
September 30, |
|
December 31, |
||
|
|
2026 |
|
2025 |
||
Assets |
|
|
|
|
||
Current assets: |
|
|
|
|
||
Cash and cash equivalents |
|
$ |
65,786 |
|
$ |
69,358 |
Receivables (net of allowance of |
|
|
285,227 |
|
|
190,732 |
Contract assets |
|
|
66,257 |
|
|
41,468 |
Inventories |
|
|
893,006 |
|
|
553,834 |
Prepaid expenses and other current assets |
|
|
45,458 |
|
|
37,937 |
Total current assets |
|
|
1,355,734 |
|
|
893,329 |
Property and equipment (net of accumulated depreciation of |
|
|
176,402 |
|
|
91,098 |
Intangible assets (net of accumulated amortization of |
|
|
950,496 |
|
|
295,962 |
Goodwill |
|
|
1,853,509 |
|
|
641,242 |
Operating lease right-of-use assets |
|
|
89,367 |
|
|
50,151 |
Note receivable |
|
|
29,126 |
|
|
27,041 |
Other assets |
|
|
25,324 |
|
|
29,755 |
Total assets |
|
$ |
4,479,958 |
|
$ |
2,028,578 |
|
|
|
|
|
||
Liabilities and Stockholders' Equity |
|
|
|
|
||
Current liabilities: |
|
|
|
|
||
Current portion of long-term debt |
|
$ |
32,344 |
|
$ |
7,500 |
Accounts payable |
|
|
211,024 |
|
|
154,506 |
Accrued expenses and other current liabilities |
|
|
99,485 |
|
|
73,161 |
Dividends payable |
|
|
2,807 |
|
|
2,339 |
Earn-out obligations |
|
|
27,367 |
|
|
— |
Total current liabilities |
|
|
373,027 |
|
|
237,506 |
Long-term debt, net of current portion |
|
|
927,595 |
|
|
285,304 |
Deferred compensation |
|
|
4,624 |
|
|
5,918 |
Long-term operating lease obligations |
|
|
75,817 |
|
|
43,693 |
Deferred tax liabilities |
|
|
107,340 |
|
|
12,394 |
Other long-term liabilities |
|
|
8,864 |
|
|
4,955 |
Total liabilities |
|
|
1,497,267 |
|
|
589,770 |
Commitments and contingencies |
|
|
|
|
||
Stockholders' equity: |
|
|
|
|
||
Common stock, par value |
|
|
1,404 |
|
|
1,170 |
Additional paid-in capital |
|
|
2,487,011 |
|
|
1,041,483 |
Retained earnings |
|
|
492,065 |
|
|
395,643 |
Accumulated other comprehensive income |
|
|
2,211 |
|
|
512 |
Total stockholders' equity |
|
|
2,982,691 |
|
|
1,438,808 |
Total liabilities and stockholders' equity |
|
$ |
4,479,958 |
|
$ |
2,028,578 |
VSE Corporation and Subsidiaries |
|||||||||||||||
Unaudited Consolidated Statements of Operations |
|||||||||||||||
(in thousands except share and per share amounts) |
|||||||||||||||
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|||||||||||
|
|
2026 |
|
2025 |
|
2026 |
|
2025 |
|||||||
Revenues: |
|
|
|
|
|
|
|
|
|||||||
Products |
|
$ |
222,982 |
|
|
$ |
176,035 |
|
$ |
628,739 |
|
|
$ |
510,189 |
|
Services |
|
|
318,024 |
|
|
|
106,874 |
|
|
685,984 |
|
|
|
300,904 |
|
Total revenues |
|
|
541,006 |
|
|
|
282,909 |
|
|
1,314,723 |
|
|
|
811,093 |
|
|
|
|
|
|
|
|
|
|
|||||||
Costs and operating expenses: |
|
|
|
|
|
|
|
|
|||||||
Products |
|
|
177,921 |
|
|
|
147,682 |
|
|
509,306 |
|
|
|
429,377 |
|
Services |
|
|
266,138 |
|
|
|
94,486 |
|
|
584,032 |
|
|
|
270,510 |
|
Selling, general and administrative expenses |
|
|
5,281 |
|
|
|
667 |
|
|
20,513 |
|
|
|
5,594 |
|
Earn-out fair value adjustments |
|
|
(8,880 |
) |
|
|
23,300 |
|
|
(8,880 |
) |
|
|
29,200 |
|
Amortization of intangible assets |
|
|
23,095 |
|
|
|
6,687 |
|
|
50,595 |
|
|
|
19,308 |
|
Total costs and operating expenses |
|
|
463,555 |
|
|
|
272,822 |
|
|
1,155,566 |
|
|
|
753,989 |
|
Operating income |
|
|
77,451 |
|
|
|
10,087 |
|
|
159,157 |
|
|
|
57,104 |
|
|
|
|
|
|
|
|
|
|
|||||||
Interest expense, net |
|
|
14,097 |
|
|
|
4,339 |
|
|
17,925 |
|
|
|
18,723 |
|
Loss on debt extinguishment |
|
|
— |
|
|
|
— |
|
|
4,473 |
|
|
|
— |
|
Income from continuing operations before income taxes |
|
|
63,354 |
|
|
|
5,748 |
|
|
136,759 |
|
|
|
38,381 |
|
Provision for income taxes |
|
|
16,090 |
|
|
|
2,157 |
|
|
31,917 |
|
|
|
7,184 |
|
Net income from continuing operations |
|
|
47,264 |
|
|
|
3,591 |
|
|
104,842 |
|
|
|
31,197 |
|
Income (loss) from discontinued operations, net of tax |
|
|
— |
|
|
|
321 |
|
|
— |
|
|
|
(33,061 |
) |
Net income (loss) |
|
$ |
47,264 |
|
|
$ |
3,912 |
|
$ |
104,842 |
|
|
$ |
(1,864 |
) |
|
|
|
|
|
|
|
|
|
|||||||
Earnings (loss) per share: |
|
|
|
|
|
|
|
|
|||||||
Basic |
|
|
|
|
|
|
|
|
|||||||
Continuing operations |
|
$ |
1.50 |
|
|
$ |
0.17 |
|
$ |
3.50 |
|
|
$ |
1.51 |
|
Discontinued operations |
|
|
— |
|
|
|
0.02 |
|
|
— |
|
|
|
(1.60 |
) |
|
|
$ |
1.50 |
|
|
$ |
0.19 |
|
$ |
3.50 |
|
|
$ |
(0.09 |
) |
|
|
|
|
|
|
|
|
|
|||||||
Diluted |
|
|
|
|
|
|
|
|
|||||||
Continuing operations |
|
$ |
1.49 |
|
|
$ |
0.17 |
|
$ |
3.45 |
|
|
$ |
1.50 |
|
Discontinued operations |
|
|
— |
|
|
|
0.02 |
|
|
— |
|
|
|
(1.59 |
) |
|
|
$ |
1.49 |
|
|
$ |
0.19 |
|
$ |
3.45 |
|
|
$ |
(0.09 |
) |
|
|
|
|
|
|
|
|
|
|||||||
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|||||||
Basic |
|
|
31,479,631 |
|
|
|
20,681,203 |
|
|
29,987,463 |
|
|
|
20,656,680 |
|
Diluted |
|
|
31,790,115 |
|
|
|
20,756,508 |
|
|
30,351,277 |
|
|
|
20,742,957 |
|
|
|
|
|
|
|
|
|
|
|||||||
Dividends declared per share |
|
$ |
0.10 |
|
|
$ |
0.10 |
|
$ |
0.30 |
|
|
$ |
0.30 |
|
|
|
|
|
|
|
|
|
|
|||||||
VSE Corporation and Subsidiaries |
||||||||
Unaudited Consolidated Statements of Cash Flows |
||||||||
(in thousands) |
||||||||
|
|
Nine months ended September 30, |
||||||
|
|
2026 |
|
2025 (a) |
||||
Cash flows from operating activities: |
|
|
|
|
||||
Net income (loss) |
|
$ |
104,842 |
|
|
$ |
(1,864 |
) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|
|
|
|
||||
Depreciation and amortization |
|
|
66,851 |
|
|
|
29,730 |
|
Amortization of debt issuance cost |
|
|
2,203 |
|
|
|
1,266 |
|
Deferred taxes |
|
|
12,944 |
|
|
|
(19,117 |
) |
Stock-based compensation |
|
|
12,992 |
|
|
|
9,908 |
|
Impairment and loss on sale of business segments |
|
|
— |
|
|
|
47,046 |
|
Loss on sale of property and equipment |
|
|
219 |
|
|
|
10 |
|
Gain on settlement of corporate-owned life insurance |
|
|
(357 |
) |
|
|
— |
|
Interest income on note receivable |
|
|
(2,084 |
) |
|
|
(1,342 |
) |
Earn-out fair value adjustments |
|
|
(8,880 |
) |
|
|
29,200 |
|
Loss on debt extinguishment |
|
|
4,473 |
|
|
|
— |
|
Changes in operating assets and liabilities, net of impact of acquisitions: |
|
|
|
|
||||
Receivables |
|
|
(18,915 |
) |
|
|
(23,243 |
) |
Contract assets |
|
|
(11,620 |
) |
|
|
(2,954 |
) |
Inventories |
|
|
(148,409 |
) |
|
|
(26,522 |
) |
Prepaid expenses and other current assets and other assets |
|
|
(1,620 |
) |
|
|
(8,991 |
) |
Operating lease assets and liabilities, net |
|
|
2,697 |
|
|
|
837 |
|
Accounts payable and deferred compensation |
|
|
1,428 |
|
|
|
(42,067 |
) |
Accrued expenses and other liabilities |
|
|
4,520 |
|
|
|
(2,549 |
) |
Net cash provided by (used in) operating activities |
|
|
21,284 |
|
|
|
(10,652 |
) |
Cash flows from investing activities: |
|
|
|
|
||||
Purchases of property and equipment |
|
|
(24,699 |
) |
|
|
(14,513 |
) |
Proceeds from the sale of business segments, net of cash divested |
|
|
— |
|
|
|
138,816 |
|
Cash paid for acquisitions, net of cash acquired |
|
|
(1,830,791 |
) |
|
|
(47,745 |
) |
Purchases of intangible assets |
|
|
(15,082 |
) |
|
|
— |
|
Proceeds from corporate-owned life insurance settlements |
|
|
760 |
|
|
|
— |
|
Net cash (used in) provided by investing activities |
|
|
(1,869,812 |
) |
|
|
76,558 |
|
Cash flows from financing activities: |
|
|
|
|
||||
Borrowings on bank credit facilities, net of creditor fees |
|
|
979,357 |
|
|
|
648,066 |
|
Repayments on bank credit facilities |
|
|
(370,773 |
) |
|
|
(720,825 |
) |
Repayments on amortizing notes |
|
|
(10,924 |
) |
|
|
— |
|
Proceeds from issuance of common stock, net |
|
|
829,676 |
|
|
|
463 |
|
Proceeds from issuance of tangible equity units, net |
|
|
444,908 |
|
|
|
— |
|
Payment of debt financing costs |
|
|
(7,909 |
) |
|
|
(2,584 |
) |
Payment of taxes for equity transactions |
|
|
(10,332 |
) |
|
|
(5,077 |
) |
Dividends paid |
|
|
(7,952 |
) |
|
|
(6,195 |
) |
Other |
|
|
(984 |
) |
|
|
— |
|
Net cash provided by (used in) financing activities |
|
|
1,845,067 |
|
|
|
(86,152 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
(111 |
) |
|
|
— |
|
Net increase (decrease) in cash and cash equivalents |
|
|
(3,572 |
) |
|
|
(20,246 |
) |
Cash and cash equivalents, beginning of period |
|
|
69,358 |
|
|
|
29,030 |
|
Cash and cash equivalents, end of period |
|
$ |
65,786 |
|
|
$ |
8,784 |
|
(a) The cash flows related to discontinued operations and held-for-sale assets and liabilities have not been segregated. Accordingly, the Consolidated Statements of Cash Flows include the results of continuing and discontinued operations. |
||||||||
VSE Corporation and Subsidiaries |
||||||
Unaudited Consolidated Statements of Cash Flows (continued) |
||||||
(in thousands) |
||||||
|
|
Nine months ended September 30, |
||||
|
|
2026 |
|
2025 |
||
Supplemental disclosure of noncash investing and financing activities: |
|
|
|
|
||
In-kind equity purchase consideration from acquisition |
|
$ |
238,002 |
|
$ |
— |
Earn-out obligation purchase consideration from acquisition |
|
$ |
33,850 |
|
$ |
— |
Note receivable from the sale of business segment |
|
$ |
— |
|
$ |
25,000 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20261104633725/en/
INVESTOR CONTACT
Michael Perlman
VP, Investor Relations & Treasury
T: (954) 547-0480 M: (561) 281-0247
investors@vsecorp.com
Source: VSE Corporation