The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
On September 9, Perma-Pipe International Holdings (NASDAQ:PPIH) reported second-quarter results that showed a company stretching well past its traditional turf. Net sales climbed 24.4% year over year to $59.6 million, but the more telling figure sat inside the backlog. At $142.3 million as of July 31, it was up 17% from $121.6 million at the start of the fiscal year on January 31, with nearly all of it scheduled to convert to revenue within 12 months. Behind that growth sits a pivot from selling pipe to building infrastructure platforms across the Middle East.
The most ambitious move is a memorandum of understanding with Welspun to form a joint venture in Jordan, which CEO Saleh Sagr said would let Perma-Pipe "enter the pipe manufacturing market for the first time ever." That venture is tied to Jordan's National Water Carrier Program and positions the company for reconstruction work across Syria, Iraq, and the broader Levant. A new $90 million credit facility with JPMorgan Chase, plus $50 million of additional incremental capacity, gives the balance sheet room to chase projects that size once required.
The growth came at a cost. Gross margin slipped to 29.2% from 30.1% a year earlier, weighed down by higher materials and logistics expenses and $500,000 in Ohio startup costs. The bigger drag was a $3.9 million full write-off of a receivable tied to a single customer's deteriorating finances, a charge management attributed directly to that customer's financial position rather than to broader demand. Sagr also flagged that "some of the impact in our margins currently is due to the ongoing conflict in the Middle East," which has pushed up shipping and commodity costs, and warned that fixed-price, short-execution contracts sometimes prevent the company from passing those costs on. The strain shows up over a longer window too.
Six-month net income attributable to common stock fell to $4.3 million from $5.8 million, and income from operations over the same stretch dropped to $8.9 million from $11.1 million, even as the second quarter itself improved. Total debt also ticked up, to $36.1 million from $32.5 million at the end of the prior fiscal year.