EVI Industries, Inc. (EVI) - Form 10-K Summary
Business Context and Reporting Period
Company: EVI Industries, Inc.
Filing Type: Annual Report on Form 10-K
Reporting Period: Fiscal year ended June 30, 2026
Business Overview: EVI is a value-added distributor of commercial and industrial laundry equipment, parts, and accessories, providing installation, maintenance, and repair services. The company operates primarily in the United States, Canada, the Caribbean, and Latin America. As of June 30, 2026, the company reported results through a single operating segment. In July 2026, the company announced a strategic expansion into the consumer garment care services industry via the acquisition of Sudsies, Inc., consummated on September 1, 2026.
Key Financial Metrics
| Metric | Fiscal 2026 | Fiscal 2025 |
|---|---|---|
| Revenues | $446.6 million | $389.8 million |
| Gross Profit | $140.7 million | $118.3 million |
| Gross Margin | 31.5% | 30.4% |
| Operating Income | $15.7 million | $13.8 million |
| Net Income | $7.7 million | $7.5 million |
| Diluted EPS | $0.48 | $0.49 |
| Cash from Operations | $20.6 million | $21.3 million |
| Long-Term Debt | $51.0 million | $53.0 million |
| Cash and Equivalents | $6.8 million | $8.9 million |
Material Changes vs. Prior Period
- Revenue Growth: Revenues increased by 15% ($56.7 million) compared to fiscal 2025, primarily driven by acquisitions made in fiscal 2025 and 2026.
- Profitability: Net income increased by 3% despite a 20% increase in Selling, General, and Administrative (SG&A) expenses. Gross margin improved to 31.5% from 30.4% due to favorable product and customer mix.
- Acquisitions:
- Fiscal 2026: Acquired ASN Laundry Group (NY) and Belenky, Inc. (OH) for a total consideration of approximately $3.9 million.
- Post-Period: Acquired Sudsies, Inc. (FL) on September 1, 2026, for $37.4 million, marking entry into the consumer garment care market.
- Capital Structure: Total assets decreased slightly to $304.5 million from $307.0 million. Total liabilities decreased to $154.4 million from $163.6 million, driven by reductions in accounts payable and long-term debt.
- Dividends: Paid a special cash dividend of $0.33 per share in October 2025 (totaling ~$5.0 million).
Guidance, Outlook, and Risks
Outlook and Strategy: The company continues to pursue a "buy-and-build" growth strategy. Management believes the consumer garment care industry represents a compelling long-term opportunity. A new $10.0 million share repurchase program was approved in July 2026. The company expects existing cash, operating cash flow, and credit facility availability to fund operations for the next 12 months.
Key Risks and Contingencies:
- Acquisition Integration: Risks associated with integrating new businesses, particularly the new consumer garment care division, including operational challenges and potential goodwill impairment.
- Supply Chain and Suppliers: Heavy reliance on four manufacturers for approximately 71% of product purchases. Disruptions or loss of relationships could materially impact operations.
- Environmental Liabilities: The new consumer garment care operations involve the use of hazardous substances (e.g., perchloroethylene), creating potential environmental liabilities and compliance costs.
- Debt Covenants: The company is subject to financial covenants under its $150 million credit facility (maturity March 2030), including maximum leverage and minimum interest coverage ratios. As of June 30, 2026, the company was in compliance.
- Interest Rate Risk: Variable rate debt exposes the company to interest rate fluctuations; a 1% increase in rates would increase annual interest expense by approximately $510,000.
Investor Verification Checklist
- Acquisition Accounting: Verify the final purchase price allocation for the Sudsies acquisition (closed Sept 1, 2026) and its impact on future goodwill and intangible asset amortization.
- Supplier Concentration: Monitor the stability of relationships with the top four suppliers, which account for over 70% of product purchases.
- Debt Capacity: Assess the impact of the $37.4 million Sudsies acquisition on the company's leverage ratio and compliance with credit agreement covenants.
- Consumer Segment Performance: Track the financial performance and integration progress of the new consumer garment care segment in the first quarter of fiscal 2027.
- Share Repurchases: Monitor execution of the new $10.0 million share repurchase program approved in July 2026.