The Gorman-Rupp Company

What they do

Gorman-Rupp designs, manufactures, and markets pumps and pump systems internationally. Its products serve multiple end markets, including water, wastewater, construction, dewatering, industrial, petroleum, original equipment, agriculture, fire suppression, HVAC, and military applications. The company operates through various product lines and facilities, including National Pump Company and Patterson Pump Company.

Revenue drivers

• Industrial — Net sales of $139.6 million in 2025, up 6.2% from 2024, driven partly by data center demand.
• Fire suppression — Net sales of $128.1 million in 2025, up 5.5% from 2024, with demand related to data centers.
• Municipal — Net sales of $103.5 million in 2025, up 3.4%, benefiting from infrastructure spending and flood control demand.
• Agriculture — Net sales of $84.6 million in 2025, up 2.9%, with broad-based improvement in 2026 across Fill-Rite channels.

Recent performance

For Q2 2026, net sales rose 3.9% to a record $186.1 million, and net income increased to $19.4 million ($0.74 per share) from $15.8 million ($0.60) in Q2 2025. Gross margin improved 130 basis points to 32.6%, and adjusted EBITDA was $38.2 million (20.5% of sales). For the first half of 2026, net sales were $362.7 million, up 5.7%, and net income was $37.3 million ($1.41 per share), up from $27.9 million ($1.06). Total debt decreased $33.0 million during the first six months of 2026.

Strategy

Management is focused on optimizing its manufacturing footprint, including reducing National Pump Company facilities from six to three, which is expected to lower fixed costs by $2.0 million to $2.5 million annually. The company continues to invest in employee training, new product development, and modern manufacturing equipment to increase efficiency and capacity. Strong cash flow is being used to reduce debt and interest expense. Management also emphasizes product quality, applications performance, and timely delivery to drive growth.

Risks

• Key personnel loss — The company depends on its executive management team and ability to retain highly-skilled personnel; loss could limit growth and operations.
• Intellectual property infringement — Third parties may copy the company's products or technology, or competitors could develop similar designs, increasing competition.
• Market concentration in construction and agriculture — Sales in these markets are subject to cyclical demand; construction sales declined 11.1% in 2025 but recovered in 2026.
• International shipment variability — Fire suppression sales decreased in Q2 2026 due to reduced international shipments, showing exposure to global demand fluctuations.

Outlook

Management's outlook for 2026 is positive, citing a 10% increase in incoming orders in 2025 and a healthy backlog of $244.0 million at year-end. They expect municipal market benefits from infrastructure spending and strong demand for flood control, plus increased demand from data center construction across multiple markets. The company expects to continue paying regular quarterly dividends and increased annual dividends, with future dividends at the board's discretion.