Perma-Pipe's Record Surge: From Oil Fields to Data Centers

THE WOODLANDS, TX – December 12, 2025 – Perma-Pipe International Holdings, Inc. (NASDAQ: PPIH) has delivered a financial performance that turns heads, posting third-quarter results that not only shatter previous records but also paint a vivid picture of a company executing a precise and potent growth strategy. With quarterly net sales jumping nearly 47% and net income rocketing an astonishing 152% year-over-year, the specialist in pre-insulated piping systems is demonstrating more than just a cyclical upswing. It's a case study in leveraging core expertise to dominate key geographic markets while simultaneously pivoting into the infrastructure of tomorrow.

The headline figures from the quarter ended October 31, 2025, are formidable. Net sales hit $61.1 million, a significant leap from $41.6 million in the same period last year. This revenue surge translated directly to the bottom line, with net income attributable to common stock reaching $6.3 million, or $0.77 per diluted share, compared to just $2.5 million a year prior. As President and CEO Saleh Sagr noted, this performance was fueled by “higher sales volumes in both the Middle East and North America.”

What makes these results particularly significant is their momentum. With one quarter still left in its fiscal year, Perma-Pipe's year-to-date net income of $12.1 million has already eclipsed the full-year results of fiscal 2024. This marks the highest level of earnings the company has achieved since its 2017 transition from MFRI, signaling a new era of profitability and operational strength.

The Foundation: A Burgeoning Backlog

While stellar quarterly earnings reflect past and current success, the true indicator of a company’s forward momentum often lies in its backlog. Here, Perma-Pipe’s story becomes even more compelling. The company reported its backlog now stands at a robust $148.9 million. This figure represents not only a 7.8% increase since the beginning of the fiscal year but, more impressively, a greater than 30% expansion over the backlog recorded at the end of the prior year’s third quarter.

In the world of industrial manufacturing and large-scale projects, a backlog is the book of secured future business. This substantial increase provides strong revenue visibility into the coming quarters, insulating the company from short-term market fluctuations and demonstrating sustained, high-level demand for its specialized solutions. According to Sagr, this growth is not isolated to one region, with the expansion being “evident across both North America and the MENA region, underscoring the sustained strength of demand for our solutions.” This balanced global demand is a hallmark of a resilient and well-positioned enterprise.

A Two-Pronged Strategy: Regional Dominance and Sector Diversification

Beneath the impressive financial metrics lies a deliberate strategy of deep regional penetration and savvy market diversification. The strong performance in the Middle East is no accident. It’s the result of strategic investments designed to capture a larger share of the region’s massive infrastructure spending. A key example is the company’s new facility in Qatar, which has already hit the ground running by securing over $5.0 million in awards scheduled for execution before the fiscal year ends.

This move is part of a broader push across the Middle East. Recent announcements also highlight major awards related to Saudi Aramco projects, which will be executed from Perma-Pipe's newly approved facility in Dammam, Saudi Arabia. By establishing a strong local manufacturing and operational presence, the company reduces logistical complexities, shortens lead times, and becomes a more integrated partner in the region's development, particularly in district heating and cooling (DHC) systems and energy infrastructure.

Perhaps more indicative of its forward-looking strategy is Perma-Pipe’s successful push into the digital infrastructure space. While its roots are in oil and gas, the company recently secured $22 million in new awards for major data center projects in the United States. This is a critical pivot. Modern data centers, packed with powerful, heat-generating processors, increasingly rely on sophisticated liquid cooling systems to operate efficiently and sustainably. These systems require precisely engineered, pre-insulated piping to transport coolant with minimal thermal loss—a core competency of Perma-Pipe. By applying its expertise to this booming sector, the company is tapping into a long-term, non-cyclical growth driver that complements its traditional energy markets.

Managing Growth and Building a Mature Platform

Rapid growth often comes with significant operational challenges, but Perma-Pipe appears to be navigating this phase with discipline. The company’s gross profit swelled to $21.0 million for the quarter, a testament to what Sagr describes as “improved operating leverage.” This indicates that the company is effectively scaling its operations to handle higher volumes without a proportional increase in costs, leading to enhanced profitability.

At the same time, the company is making necessary investments in its corporate structure. Selling, general, and administrative (SG&A) expenses rose to $8.3 million, partly due to approximately $0.5 million in costs related to Sarbanes-Oxley (SOX) 404 compliance as the company matures. While these expenses impact short-term margins, they are essential for building the robust internal controls and financial reporting integrity required of a larger, more complex public company. This proactive investment in governance is a sign of a management team focused not just on immediate growth, but on building a sustainable, long-term enterprise.

The combination of record-breaking financial performance, a soaring backlog, and a clearly defined strategy for growth in both established and emerging markets positions Perma-Pipe as a significant force within the industrial supply chain. The company is proving that by mastering a specialized technology, it can achieve dominance in its core markets while unlocking powerful new revenue streams in the essential infrastructure of the global economy.