"We saw strong growth in places like Florida with double-digit growth in pipe, Allied products and Infiltrator products." - Scott Barbour
— Scott Barbour
03Detailed Report
WMS
Advanced Drainage Systems Inc
Period
Q4 2025
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedJun 27, 2026
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Executive Summary
In the fourth quarter of fiscal year 2025, Advanced Drainage Systems Inc (WMS) reported net sales of $615.76 million, reflecting a slight decline from the previous quarter. Despite this, the company showcased a strong performance in specific markets, particularly in Florida and Texas, where growth in pipe and Allied products was significant. The adjusted EBITDA margin, although declining slightly, stood at 30.6%, marking the second most profitable year in the company's history amidst challenges such as higher material costs and pricing pressures. Management remains optimistic, attributing their resilience to ongoing strategic initiatives and a diversified product mix, hinting at substantial growth opportunities in the near future.
Key Performance Indicators
Revenue
Decreasing
615.76M
QoQ: -10.83% | YoY: -21.32%
Gross Profit
Decreasing
238.15M
38.68% margin
QoQ: -1.43% | YoY: -18.98%
Operating Income
Decreasing
116.69M
QoQ: -8.02% | YoY: -37.72%
Net Income
Decreasing
77.16M
QoQ: -5.02% | YoY: -40.82%
EPS
Decreasing
1.00
QoQ: -4.76% | YoY: -40.48%
Revenue Trend
Margin Analysis
Financial Highlights
Revenue Performance:
- Q4 2025 Revenue: $615.76 million (YoY: -21.32%, QoQ: -10.83%)
- Adjusted EBITDA Margin: 30.6%
- Net Income: $77.16 million (Net Income Margin: 12.55%, YoY: -40.82%)
Balance Sheet Health:
- Total Assets: $3.69 billion
- Total Liabilities: $2.05 billion
- Net Debt: $962.35 million
Cash Flow Metrics:
- Free Cash Flow: -$5.31 million in Q4 2025
- Operating Cash Flow: $41.23 million
Ratios:
- Current Ratio: 3.33
- Quick Ratio: 2.10
- Return on Equity: 83.3%
- P/E Ratio: 27.30 (vs. industry average)
- Dividend Yield: 0.147% (dividend increased by 13% to $0.72 per share)
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
615.76M
-21.32%
-10.83%
Gross Profit
238.15M
-18.98%
-1.43%
Operating Income
116.69M
-37.72%
-8.02%
Net Income
77.16M
-40.82%
-5.02%
EPS
1.00
-40.48%
-4.76%
Key Financial Ratios
Gross Profit Margin
Fair
38.70%
Gross profit margin is moderate, room for improvement in cost management
Operating Profit Margin
Good
19.00%
Operating margin is healthy and competitive within industry standards
Net Profit Margin
Good
12.50%
Net profit margin is healthy and competitive within industry standards
Return on Assets
Weak
2.09%
Return on assets suggests inefficient capital allocation
Return on Equity
Strong
83.30%
Return on equity demonstrates excellent capital efficiency and value creation
Current Ratio
Strong
3.33
Current ratio indicates excellent liquidity and financial flexibility
Debt to Equity
High Risk
15.39
Debt-to-equity indicates high leverage and elevated financial risk
P/E Ratio
Growth
27.30x
Elevated P/E suggests growth expectations or premium valuation
Price to Book
High Premium
90.94x
Very high premium suggests asset-light business model or lofty expectations
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