Perma-Pipe International Holdings Reports Fiscal 2024 Financial Results with Strong Operational Momentum and Strategic Growth Initiatives
Nasdaq-listed company achieves significant backlog increase, improved margins, and solid pre-tax earnings in a challenging global environment
Perma-Pipe International Holdings,a leading global supplier of pre-insulated piping systems and leak detection technologies, released its financial results for the fourth quarter and full fiscal year ended January 31, 2025. The company reported solid top-line growth, improved profitability metrics, and a remarkable expansion of its project backlog, all of which underscore the effectiveness of its strategic initiatives in key markets.
Robust Revenue Growth Across Key Regions
For the fourth quarter of fiscal 2024, Perma-Pipe recorded net sales of $45.0 million, representing an increase of $4.8 million compared to the fourth quarter of the previous year. On a full-year basis, total revenues reached $158.4 million, up from $150.7 million in fiscal 2023, reflecting a year-over-year growth of approximately 5.1%. This growth was largely driven by higher sales volumes in the Middle East and Canadian markets, where demand for energy infrastructure and thermal distribution systems continues to expand.
The revenue increase also highlights Perma-Pipe’s resilience and adaptability in navigating global economic uncertainties, including fluctuations in raw material costs, geopolitical tensions, and supply chain disruptions. The company’s strategic focus on targeted geographic markets with high infrastructure investment has proven effective in sustaining positive momentum.
Substantial Gains in Profitability Driven by Margin Expansion
Perma-Pipe’s gross profit surged to $53.2 million in fiscal 2024, compared to $41.5 million in the prior year. This impressive $11.7 million increase reflects a 28% year-over-year improvement and translates to a gross profit margin of 34%—up from 28% in fiscal 2023. The improved margin profile is attributed to a favorable product mix, operational efficiencies, and stronger performance from higher-margin projects, particularly in the company’s operations in the Middle East and Canada.
Operating income before taxes also demonstrated solid growth. For the fourth quarter of fiscal 2024, income before taxes was $5.3 million, representing an increase of $2.1 million compared to the prior year’s fourth quarter. On an annual basis, pre-tax income climbed to $18.5 million, up by $8.6 million from the $9.9 million recorded in fiscal 2023. The company attributes this substantial improvement to strategic emphasis on value-added services and premium product lines, which continue to command higher margins.
Bottom Line Impact and One-Time Tax Effect Explanation
Net income attributable to common stockholders for fiscal 2024 was $9.0 million, compared to $10.5 million in the prior year. While this represents a nominal decrease of $1.5 million, it is important to contextualize this decline. In fiscal 2023, the company recorded a one-time, non-cash tax benefit of $5.9 million due to the recognition of past tax losses. Excluding the impact of that extraordinary tax item, Perma-Pipe’s 2024 net income would reflect an underlying improvement of $4.4 million—a clear indicator of enhanced operational performance.
David Mansfield, Perma-Pipe’s President and Chief Executive Officer, commented on this performance, stating, “Although headline net income declined slightly compared to last year, the decrease is entirely due to a non-recurring tax benefit recognized in fiscal 2023. When adjusting for this item, our underlying profitability has actually strengthened considerably, thanks to our focus on higher-margin products and disciplined execution.”
Administrative and Operational Expense Trends
General and administrative (G&A) expenses rose to $28.0 million in fiscal 2024, up from $22.6 million in the previous year. The $5.4 million increase is largely attributed to higher compensation costs and increased professional fees related to legal, compliance, and strategic advisory services. Despite the rise in overhead, the improved margins and top-line growth ensured that the overall cost structure remained well-aligned with revenue growth.
Selling expenses, on the other hand, declined slightly to $4.9 million from $5.5 million in fiscal 2023. This decrease of $0.6 million was primarily due to lower payroll-related costs, suggesting greater efficiency and productivity within the company’s sales organization. This also reflects an emphasis on digital marketing tools, customer relationship management platforms, and targeted project pursuit strategies that reduce reliance on labor-intensive sales processes.
Reduced Interest Expense and Other Income Recovery
Perma-Pipe also benefited from reduced interest expenses during the year, with total interest costs amounting to $1.9 million, compared to $2.3 million in fiscal 2023. The $0.4 million decrease was mainly the result of reduced borrowings and, to a lesser extent, lower average interest rates. This trend underscores the company’s efforts to deleverage and maintain a healthy balance sheet.
In the category of other income, the company recorded $0.1 million in fiscal 2024, a notable improvement from the $1.2 million other expense recorded the year before. This positive shift reflects the absence of a one-time pre-tax, non-cash settlement charge related to the termination of the company’s defined benefit pension plan, which was incurred in fiscal 2023.
Tax Rate Normalization and Jurisdictional Impact
Perma-Pipe’s global effective tax rate (ETR) normalized significantly in fiscal 2024, standing at 29.1%, compared to a negative rate of (33.6%) in the previous year. The previous year’s negative rate was distorted by the aforementioned one-time tax benefit, which significantly lowered the overall tax liability. The 2024 ETR more accurately reflects the company’s current tax position across its operating jurisdictions and demonstrates a stable outlook going forward.
Backlog Doubles mid Strategic Expansion
Perhaps the most promising indicator of Perma-Pipe’s growth trajectory is the extraordinary increase in its project backlog. As of the end of fiscal 2024, the company’s backlog stood at $138.1 million—an impressive 102% increase over the previous year’s figure. This record-level backlog provides clear visibility into future revenue streams and positions the company strongly heading into fiscal 2025.
Commenting on this development, CEO David Mansfield said, “Our backlog growth underscores the strength of our project pipeline and the increasing demand for our engineered piping solutions across diverse end markets. This robust pipeline places us in an excellent position to capitalize on new project opportunities and scale our operations effectively in the coming year.”
Strategic Developments in Key Markets
Throughout 2024, Perma-Pipe made significant strides in its international expansion and strategic positioning. One of the major developments was the successful formation and operation of a joint venture in Saudi Arabia, which was established in 2023. This venture has already exceeded performance expectations and is contributing positively to the company’s earnings and regional presence.
Simultaneously, Perma-Pipe has made operational headway in Canada, where its new facility in Vars, Ontario is beginning to ramp up production and win contracts. The facility strengthens the company’s manufacturing footprint in North America and enhances its ability to serve infrastructure projects requiring district heating, cooling, and industrial piping systems.
“We’re encouraged by the progress at our new Ontario facility and expect continued momentum in Canada as we scale operations,” Mansfield noted. “The success of our Saudi joint venture has given us a blueprint for future collaborations in other high-growth regions, including Qatar, where we’re actively exploring new opportunities.”
Positioned for Future Growth and Mega-Project Participation
Looking ahead, Perma-Pipe is well-positioned to participate in large-scale infrastructure and energy projects globally. With the energy transition underway and growing investments in district energy, LNG terminals, and industrial fluid transport systems, the company’s specialized offerings are increasingly in demand.
Mansfield expressed confidence in the company’s trajectory: “2024 was a strong year for Perma-Pipe. Our ability to secure large-scale project awards and build a record-level backlog provides excellent momentum going into 2025. We are particularly excited by opportunities emerging in the Middle East and North America. Our growing global footprint and proven execution capabilities make us a preferred partner for complex and high-value infrastructure projects.”
Perma-Pipe International Holdings, Inc.
Perma-Pipe International Holdings, Inc. is a global leader in the design, manufacture, and supply of pre-insulated piping systems and leak detection technologies. These systems are primarily used in applications such as district heating and cooling, oil and gas gathering, industrial process piping, and other energy-related infrastructure projects. The company leverages decades of engineering and fabrication expertise to deliver customized solutions that ensure the safe, efficient, and sustainable transportation of various liquids and gases under demanding operating conditions.
As of January 31, 2025, Perma-Pipe operates from 14 locations across six countries, positioning it to meet customer needs across North America, the Middle East, Asia, and Europe. With its reputation for quality, innovation, and project execution, the company remains focused on driving shareholder value while supporting critical infrastructure development worldwide.
