バジャー・メーター（BMI）2026年第3四半期決算説明会：利益率向上と第4四半期の成長見通し

要点

• 2026年第3四半期の売上高は前年同期比横ばいの2億3590万ドルでした。UDliveからの560万ドルを除くと、ベース売上高は前年同期比で2%減少したものの、前期比では5%増加しました。
• 営業利益は4%増加し、営業利益率は60ベーシスポイント拡大して20.2%となりました。ベース営業利益率は130ベーシスポイント上昇し、20.9%に達しました。
• 粗利益率は120ベーシスポイント上昇して41.9%となりました。超音波メーターの良好な製品ミックスとSaaS売上高の増加が、電子部品コストやUDliveの棚卸資産ステップアップ償却による圧力を相殺しました。
• 希薄化後EPSは前年同期の1.19ドルから4%増加して1.24ドルとなりました。フリーキャッシュフローは前年同期の4820万ドルに対し、4030万ドルでした。
• 経営陣は、営業日数が5%減少するにもかかわらず、第4四半期のベース売上高が前期比および前年同期比の両方で増加すると予想しています。また、通期のオーガニック売上高は1桁台前半のパーセンテージで減少する見込みであることを明らかにしました。
• バジャー・メーターは成長モメンタムが2027年まで続くと予想していますが、経営陣は具体的な通期予想の提示を控え、プロジェクト時期の変動性を強調しました。

主要財務データ

事業および業績の動向

過去に受注したプロジェクト（プエルトリコ水道下水道公社［PRASA］向けの追加出荷を含む）の拡大が続き、ベースの水道事業向け売上高は前期比で5%増加しました。AMI関連製品の売上減少は、ソフトウェア売上の増加により一部相殺されました。

経営陣は、基礎的な水道事業の需要は堅調であると述べています。異例の不振となった第1四半期の後、短期サイクルの需要は第2四半期および第3四半期ともに正常化しました。同社によると、コンサルタントとのプロジェクト評価からRFP（提案依頼書）、実際の導入に至るパイプライン全体は、近年同様に堅調を維持しています。

前年同期のハードルが高かったものの、流量計計測機器の売上高は2%増加しました。また、バジャー・メーターはデータセンター用途の需要増加も報告していますが、収益基盤としては依然として比較的小規模にとどまっています。

同社は、AMI、ネットワーク監視、水質データを統合したリアルタイムプラットフォーム「OneNetwork」を正式に立ち上げました。このプラットフォームは、事業者が水圧イベント、水質変化、無収水の急増を検知し、運用対応を調整できるように設計されています。

UDliveとSmartCoverは、バジャー・メーターのメーター計測分野を超えた事業拡大を支援し続けています。経営陣は、両事業とも同社の長期的な成長戦略に引き続き沿っていると述べました。

経営陣の見通し（ガイダンス）

経営陣は、受注済み水道プロジェクトの稼働が一段と進むことから、2026年第4四半期のベース売上高が前期比および前年同期比の両方で増加すると予想しています。同社は第4四半期の見込まれる成長を緩やかなものと位置付けており、祝日の影響で営業日数が5%少ないことに言及しました。

2026年通期について、経営陣はオーガニック売上高が1桁台前半のパーセンテージで減少する見通しであることを明確にしました。

バジャー・メーターは、成長モメンタムを2027年まで維持し、戦略目標である1桁台後半の成長軌道へと回復することに自信を示しました。ただし、プロジェクトの導入状況や短期サイクルの需要が四半期ごとに変動する可能性があるため、2027年の具体的な数値予測の提示は控えました。

同社は、粗利益率が引き続き設定済みの39%〜42%の範囲内に収まると予想しています。UDliveに関連する年間の無形資産償却費の概算は、引き続き約500万ドルとなっています。

リスクと注目点

AIやデータセンター建設に伴いサプライチェーン全体の需要が高まる中、電子部品のコスト上昇および調達圧力が増大しています。経営陣は、価格設定、調達策、運用の改善によりこれまでの影響を緩和してきたものの、四半期ごとの時期的な影響が生じる可能性は残されていると述べました。

大規模な水道プロジェクトは、設置作業員の手配、天候、顧客のスケジュールによって進行にムラが生じる可能性があります。PRASAは第2四半期および第3四半期に製品の受領を開始し、設置は第4四半期に開始される予定ですが、経営陣は直線的な導入スケジュールを前提としないよう注意を促しました。

売上計上のタイミングおよび電子部品の安全在庫の確保により、在庫レベルは通常より高い状態が続いています。同社は、年度末に向けてこれらの在庫残高を削減する見込みです。

利益率の推移は、超音波メーター、ソフトウェア、ターンキープロジェクト、電子部品コストなどの製品ミックスに対して引き続き敏感です。また、UDliveの棚卸資産の公正価値ステップアップ償却も、第3四半期の粗利益率の押し下げ要因となりました。

アナリスト質疑応答の要点

• 第4四半期および通期の売上高：経営陣は、第4四半期のベース売上高が前期比および前年同期比で緩やかに増加すると予想しています。また、通期のオーガニック売上高は1桁台前半のパーセンテージで減少する見込みであることを明らかにしました。
• 利益率の堅調さ：超音波メーターの比率上昇と継続的なソフトウェアの成長が主な押し上げ要因となりました。経営陣は、関税返還などの重大な一時的利益はなかったと述べました。
• 2027年の成長ポテンシャル：前年実績のハードル低下やプロジェクトの本格化が、同社の戦略目標である1桁台後半の成長軌道への回復に対する自信を裏付けていますが、経営陣は2027年の数値見通しを示しませんでした。
• PRASAでの導入：製品の出荷は第2四半期に開始され、第3四半期も継続しました。設置業者が選定され、通常の施工上の変動はあるものの、設置は第4四半期に開始される予定です。
• 資本配分：バジャー・メーターは第3四半期中に5500万ドルの自社株買いを実施し、自社株買い枠の残高は約3500万ドルとなっています。8月には年間配当率を10%引き上げ、34年連続増配を記録しました。

決算説明会トランスクリプト全文

決算説明会の完全なトランスクリプト

経営陣による説明

Operator

Ladies and gentlemen, welcome to the Third Quarter 2026 Badger Meter Earnings Conference Call. [Operator Instructions]

It is now my pleasure to turn the conference over to Dan Weltzien, Chief Financial Officer and Treasurer. Please go ahead, Mr. Weltzien.

Daniel Weltzien

Good morning. Thank you for joining the Badger Meter Third Quarter 2026 Earnings Conference Call. I'm here today with Ken Bockhorst, our Chairman, President and Chief Executive Officer; and Bob Wrocklage, our Executive Vice President of North America Municipal Utility.

This morning, we posted the earnings release and related slide presentation on our website. As a reminder, any forward-looking statements made on this call are subject to various risks and uncertainties, the most important of which are outlined in our news release and SEC filings.

On today's call, we may refer to certain non-GAAP financial metrics, including base results, which exclude the impact of UDlive acquired May 1, 2026. Our release and earnings presentation provide a reconciliation between the most directly comparable GAAP measure and any non-GAAP financial measures discussed.

With that, I'll turn the call over to Ken.

Kenneth Bockhorst

Thanks, Dan, and good morning. We were pleased with the sales and operating profit performance in the quarter. Excluding the solid revenue contribution of the UDlive acquisition, third quarter base sales increased 5% sequentially from the second quarter. This was largely in line with our expectations and the result of the ongoing ramp of previously disclosed awarded projects and solid underlying market demand in the quarter.

As noted in the release, we continue to anticipate both sequential and year-over-year improvement in revenue in the fourth quarter and expect to sustain this growth momentum into 2027, which I'll discuss further in the outlook. The team executed well on the profitability front as we continued operating cost management actions to mitigate the uneven 2026 sales cadence while also addressing ongoing material cost pressures related to broad electronic supply chain dynamics as we described last quarter.

I'll turn the call over to Dan to walk through the specifics of the quarter, and then Bob will provide an update on commercial activity, including our formal launch of OneNetwork. I'll then come back to cover the outlook and take your questions.

Go ahead, Dan.

Daniel Weltzien

Thanks, Ken. Turning to Slide 3. Total sales in Q3 were $235.9 million, in line with the third quarter of 2025. Excluding the benefit of UDlive sales of $5.6 million, base sales were down 2% year-over-year. Sequentially, base sales were 5% higher than the second quarter levels with a number of the previously disclosed awarded projects ramping, including another quarter of PRASA shipments. Utility water sales were flat year-over-year and excluding the acquisition, were down 3%, reflecting the same project pacing dynamics mentioned earlier.

Lower AMI-related product sales were partially offset by higher software revenue. It is important to note that base utility sales improved 5% sequentially. Sales of the flow instrumentation product line were up 2% year-over-year against the prior year's most difficult comparison as we experienced broad-based water application demand. We continue to see increasing demand in data center applications for our flow instrumentation products, albeit from a relatively small revenue base. We were pleased with operating profitability this quarter, largely the result of higher sales, ongoing structural mix benefit to gross margins and effective price/cost management.

On a year-over-year basis, operating earnings increased 4% with margins up 60 basis points to 20.2% Base operating profit margins, excluding UDlive were 20.9%, up 130 basis points from last year's third quarter.

Gross margin was 41.9%, up 120 basis points from the third quarter of 2025, reflecting structural mix improvements primarily from higher ultrasonic meter sales and continued growth of our Software-as-a-Service revenue, partially offset by the dilutive impact of UDlive's inventory fair value step-up amortization in the quarter. Base gross margin was 42.1% at the top end of our normalized range, indicative of the resiliency of our overall structural mix and pricing discipline.

Last quarter, I called out the increasing level of electronic component costs and availability pressures to gross margins, which are a byproduct of the AI and data center build-out demand. As demonstrated by our margin performance, we have thus far been able to adequately mitigate these impacts. However, the challenges posed by these pressures have not abated.

Turning to selling, engineering and administrative expenses. The third quarter's $51.1 million was $1.3 million higher year-over-year, including $2.3 million from the addition of UDlive, inclusive of the intangible asset amortization. This was partially offset by lower incentive compensation and the benefit of appropriate cost controls. As a reminder, our preliminary expectation for UDlive intangible asset amortization is approximately $5 million annually. The effective income tax rate in the quarter was 25.1% compared to 26.1% last year.

Finally, diluted earnings per share were $1.24, an increase of 4% from $1.19 in the prior year period. Primary working capital as a percentage of sales was 23.6%, up slightly from 22.9% at the prior quarter end. We anticipate continuing to work down the above-average inventory levels resulting from revenue pacing dynamics and electronic safety stock levels as the year concludes.

Free cash flow was $40.3 million, down from $48.2 million in the prior year comparable quarter. As always, we remain focused on delivering free cash flow conversion in excess of 100% of net earnings. In the third quarter of 2026, we repurchased 423,000 shares for a total of approximately $55 million and have roughly $35 million remaining on our current share repurchase authorization.

With that, I'll turn the call over to Bob.

Robert Wrocklage

Thanks, Dan. A few weeks ago, we had the opportunity to connect with customers, engineering consulting firms and investors at WEFTEC in New Orleans. During the show, we formally launched OneNetwork, our real-time network monitoring and analysis platform for water and wastewater utilities.

For those that attended our Investor Day back in May of this year, you heard an early preview of OneNetwork. In short, OneNetwork brings AMI, network monitoring and water quality data together in one platform, enabling customers to identify issues sooner, coordinate responses faster and make more informed operational decisions.

Why is this important? Utilities today have an immense amount of data from online sensors to SCADA and GIS information. OneNetwork provides a unified real-time view of this disconnected data to make it usable. By moving from fragmented data to a single operational view, OneNetwork empowers utilities through alerts, advanced analytics and workflows to better manage issues such as pressure events, water quality changes and non-revenue water spikes. This saves utilities both time and money while increasing their capability to respond faster and act with purpose.

WEFTEC visitors were able to view OneNetwork demonstrations and customer and consultant interest was high. It serves as another example of our competitive differentiation through innovation, portfolio constructions and the benefits derived by customers from our sole focus on value-driven water technology.

One important way we gain critical feedback and inform our innovation is through our engaged customer community, which encompasses in-person and virtual discussions throughout the year. This week, we had the signature event, ENGAGE Live hosted in our hometown of Milwaukee, where current and prospective customers interacted with our leadership, product management and sales and customer support teams.

Among other outcomes, the event has served to share best practices for implementations, outcomes and funding sources as well as gain insight and share feedback on our future product and software plans. It is clear from talking to customers that utility needs for and interest in our tailorable solutions to meet their increasing challenges remains high, and we are well positioned to capitalize on these opportunities to improve customer outcomes.

With that, I'll turn the call back to Ken.

Kenneth Bockhorst

Thanks, Bob. Looking ahead to the fourth quarter, I'll reiterate here what we said in the release, which is consistent with our discussions over the past few quarters. We continue to anticipate further ramping of awarded utility projects, noting, as always, the inherent unevenness typical of the business. We expect both year-over-year and sequential quarterly base sales growth in the fourth quarter of 2026, despite fewer total operating days given the holidays, which is a standard annual dynamic.

While I won't delve into 2027 specifics at this point, I will note that our conviction in sustaining this growth momentum into 2027 as well as the long-term growth profile for Badger Meter remains intact as we continue to manage usual quarter-to-quarter dynamics. We remain committed to the strategic formula that has driven our prolonged success, focusing on our customers, offering innovative and differentiated technologies and driving operational excellence.

You heard Bob speak to advancements in software outcomes and customer engagement, which reinforce our multiyear opportunities in both metering and beyond the meter growth. Our long-standing capital allocation approach of investing in growth while also returning cash to shareholders also supports this long-term growth strategy.

For example, in August, we increased our annual dividend rate by 10%, marking the 34th consecutive year of increases, and we repurchased $55 million of our outstanding shares, bringing the trailing 4 quarters to over $130 million.

In summary, I remain optimistic about our team's ability to deliver value creation opportunities for our customers and shareholders alike.

With that, operator, please open the line for questions.

Operator

[Operator Instructions]

Your first question comes from the line of Nathan Jones with Stifel.

質疑応答

Nathan Jones

I guess, Ken, I'm going to start off with the 4Q guidance. You guys have talked about full year revenue being flattish. The 4Q guide being sequentially and year-over-year better would be a pretty wide range to get into something that would be flattish. So I'm hoping you can put a finer point on what you think 4Q revenue is likely to be? And what's the upper and lower bound view on flattish?

Kenneth Bockhorst

Yes. Yes. Thanks, Nathan. Yes. When we put that term out there earlier in the year, you'll recall that at Investor Day, when we were asked on flattish, I called out, don't expect upside, right? So on a year-over-year basis, I was pretty vocal on the best case would be flat year-over-year. The way things have played out, we're really proud of where we're headed going into Q4, looking at year-over-year growth. We said we'd exit the year with momentum. We're doing that. When we talk about modest growth in the quarter, that keeps in mind the 5% fewer workdays in the quarter, but we expect to be up. So if you needed to peg me on something at this point, I would say that I would expect modest growth in the quarter sequentially and perhaps low single digits on a year-over-year full year basis.

Nathan Jones

Okay. That's helpful. I guess my follow-up question is on gross margins, which were much better than I expected them to be in the quarter given some of the pressures that you were facing from lower gross margins on some of the projects that are ramping up. Obviously, there's inflation that's passing through. So maybe you can just talk a little bit about the dynamics there, what led to those gross margins being as strong as they were and how you're thinking about those in the fourth quarter and as we head into next year?

Kenneth Bockhorst

Yes, sure. So first thing, I want to clarify, I'm sure you understood what I meant, but I didn't say the word down. So we expect to be down year-over-year, low single digits, just to be clear. In terms of...

Nathan Jones

Low single digits year-over-year...

Kenneth Bockhorst

Full year, down low single digits.

Nathan Jones

Low single digit. Full year, down low single digits, 4Q up low single digits? Or was that not what you said?

Kenneth Bockhorst

I'm not providing a digits on the up for Q4. Modestly up.

Nathan Jones

Down low single digits full year. Got it.

Kenneth Bockhorst

Correct. Got it. Perfect. Now when it comes to margin -- yes, sure thing. When it comes to margins, I'll just reiterate what we've said for several years now. We have this really positive structural mix that regardless of operating conditions, it does tend to get incrementally better every year when we have really nice growth in software that's higher margin. Beyond the meter is all higher margin.

So the structural mix remains greatly intact, which helps us with a really strong floor on margins. And then also our hallmark, I think, for the last 5 or 6 years is when challenged, we've performed in a really operationally excellent way. So we understood what the challenges are, and I'm really proud of our team, how we handled it. I'll turn it to Dan here for some more specifics. But just generally, I feel really good of how we've navigated the quarter.

Daniel Weltzien

Yes. And so Nathan, if I look at the quarter specifically and go back to the remarks that I had in the script, the biggest 2 drivers within the quarter were what I called out, which was ultrasonic meter mix generally across the residential space and then continued software growth. So as we move throughout the year, and as you know, the resiliency of our software growth is in the installed base. And so despite the unevenness that we've experienced throughout the year, that software growth has continued.

All the other things I've called out in prior quarters are the same drivers that we're paying attention to, both on the positive side from a structural mix perspective, but also on the downside risk perspective from turnkey mix and electronic component availability and supply and cost. So it's really all of the same drivers. It's just how does that particular quarter play out.

Nathan Jones

No onetimers like tariff refunds or anything in the quarter?

Daniel Weltzien

Nothing meaningful.

Operator

Your next question comes from the line of Quinn Fredrickson with Baird.

Quinn Fredrickson

Recognize you have these larger AMI projects kicking off, but the release mentioned solid underlying demand trends in the third quarter. I know you don't break it out, but even qualitatively, does the underlying day-to-day replacement business feel like it's getting a little healthier or more normal? Just any commentary there?

Kenneth Bockhorst

Yes. Just if we circle back to how we talked about this in Q1, we were pointing out that on that shorter visibility window, there is inherent unevenness, can be up, can be down. And certainly, we were surprised to how far down in Q1. But Qs 2 and 3 have been perfectly normal. So obviously, to get to the result that we did, Q2 was better than Q1. Q3 was better than Q1. So structurally, demand feels good to us. And while Q1 was down, the year has really been pretty normal other than that one outlier.

Quinn Fredrickson

Great. Second, just on PRASA. There's been some headlines about drought and water supply pressures in Puerto Rico. Is the urgency around the AMI rollout changed at all with that? Or does that create any more urgency to create a faster deployment schedule? Just any commentary on how that impacts the project there?

Kenneth Bockhorst

Yes. So it wouldn't be appropriate for me to comment on their ability or desire to go faster or not. The challenges you read about are certainly real, and that's why they're looking to adopt our AMI system. What I can tell you is we've begun shipping product this year. We had mentioned that we began in Q2 and Q3 because they're ramping up to get started with installations. They've hired the installation contractors. They're in planning, and they're expecting to start installations in Q4.

Yes, I think ideally, if they could go faster, they'd love to. But the way these projects are, I should probably point out that just because the projects are ramping, they will also be inherently uneven. Some go faster, some go slower from quarter-to-quarter as you run into manpower challenges or weather issues. So the project starting, inclusive of PRASA and the others feels great for the long term, but I do always want to remind people quarter-to-quarter, there can be variation even though these projects are in flight.

Operator

The next question comes from the line of Jeff Reive with RBC Capital Markets.

Jeffrey Reive

So given the 9 projects ramping, UDlive annualizing midyear next year and kind of easier comps across all 4 quarters, is it fair to expect a return to high single-digit organic next year? Or could that ramp dynamic actually push you above that range?

Kenneth Bockhorst

Yes. I think the math equation of that sounds correct, right? As we head into Q4, that's an easier year-over-year comp and the first couple of quarters are certainly easier than the back half will be. I'm not going to peg a year because of all the inherent unevenness I just talked about when short cycles can be and how projects can ramp or not, but we feel really good about the year in general in terms of our ability to get back on our strategic growth horizon of high single digits. But to peg the year is probably not great at the moment, but we feel good about it.

Jeffrey Reive

Fair enough. And then last quarter, you flagged the increasing electronic component costs and availability pressures tied to AI and data center demand. Have those pressures escalated further? And have you needed to take any incremental pricing or sourcing actions?

Kenneth Bockhorst

Yes. So they have escalated. So we do continue to see some price escalation. We do continue to see availability challenges. Again, I want to point out, our team has been excellent this time and the last time we faced a similar situation. We understand the challenge in front of us. Our team is working hard on it. Fortunately, for us, our portfolio is highly valued by our customers. They understand what we do for them, and we're able to extract the value that we deserve. So the word -- I'd rather talk about that than pricing. But yes, we can balance price/cost dynamics pretty effectively.

Operator

The next question comes from the line of James Ko with Jefferies.

Jae Hyun Ko

Just one quick clarification question. When you say low single-digit decline for the full year, is that organic or inclusive of UDlive here?

Kenneth Bockhorst

That is organic.

Jae Hyun Ko

Awesome. Yes. And I guess, can we talk about like the non-metering businesses like UDlive and SmartCover, how they are doing, whether those are growing above the company average and whether those are kind of trending in line with your deal case?

Kenneth Bockhorst

Yes. So as you know, those are also in our utility bucket that we talked about more broadly. UDlive is still very public. We're really excited about the opportunities as we were when we acquired both of these companies. It's an absolute need that every utility customer deals with. It's an innovative product. We've got the right sales channel. So feel good about the progress on UDlive, feel equally as good about SmartCover, and that will continue to be part of this high-digit growth story that we talked about for years to come.

Operator

The next question comes from the line of Scott Graham with Seaport.

Scott Graham

I have 2 questions for you. First is, I know you talked about underlying demand in a previous question. I'm just wondering, the other 2 of the big 3, so to speak, are talking about the category having been fairly sluggish all year. And it's hard to say if they're parsing out their software businesses. But certainly, the metering units seems to be an issue this year. Could you talk about that a little bit and kind of why that weakness has kind of pervaded all year and perhaps what you're thinking that the category looks like in units, meter units next year?

Kenneth Bockhorst

Yes. So that's a great question. So with 50,000 utilities of different sizes and shapes and geographies, it's hard for me to tell you across the board, a cookie-cutter answer that the market is down x percent. I don't know what the other big 2 have in terms of projects like we detailed for you. They may have different unevenness in their business that -- actually, I'm certain they have it. I just don't know what their particular mix is.

So it wouldn't be appropriate for me to comment on what their issue is. But what I see and when we talk to customers, and we -- as Bob pointed out, we saw customers at WEFTEC, we saw customers this week in Milwaukee. And I get all the noise that's out there about the market and all the things that people have talked about in the past around funding, but our customers are looking forward to the future to deal with the issues that they have to deal with. They have to upgrade their infrastructure. They have to be better informed about what decisions to make with their limited resources. And we're just really happy that they're choosing our portfolio. So I shouldn't comment on the other guys.

Scott Graham

Okay. I wanted to just also ask about the gross margin in the backlog. And I know the backlog has been burned down a lot in the last couple of years with supply chain getting better. I'm just wondering, you have a little bit more visibility now on these projects, which are now starting to ship. I was just sort of hoping if you can just tell us that the gross margin backlog, how much of that is linked to CPI? And for the rest of it, how are you handling price increases?

Kenneth Bockhorst

Yes. So I would just reiterate that even though we've been operating at the higher end, just given all the mix things that can happen and some of the lack of visibility on short term, as you pointed out, we feel really good about our ability to operate within the 39% to 42% gross margin range that we talked about. We feel great as we resume growth, being able to get back to that really good leverage of SEA that we've talked about before. So all in, it feels manageable to us to stay within the margin ranges that we've consistently communicated.

Operator

Your next question comes from the line of William Grippin with Barclays.

William Grippin

All right. Apologies to come back to the margin question again. But your commentary last quarter when you called out some of the supply chain cost pressures, it felt to me like maybe you were trying to signal something, right? And here with third quarter results, clearly, margin was quite good at the high end of your long-term target range. Are you trying to signal something in terms of how we should expect margin to trend in the fourth quarter or even into next year as some of these larger projects start to ramp and perhaps I don't know if there's any notable differences in your contract structures we should be aware of there.

Daniel Weltzien

Yes. So when I signal those things, I'm trying to signal the whole of all of the components that go into our gross margin picture. And again, I always remind people, structural mix is the biggest driver. And so when we call out in the quarter, what's happening with ultrasonic meter mix and what's happening with software mix, maybe that's masking some of what's happening on the electronics side, but we're also managing that dynamic as well.

And so me calling that out as a particular risk isn't trying to, in the next quarter, tell you what's going to happen. It's just trying to show you that there's multiple levers that contribute to what our margin performance is in any given quarter or month -- quarter or year. And at the time where we are right now, we started to talk about that pressure here in the second quarter and as of the end of the third quarter, I would say the challenges still exist. We've been able to manage it. We feel over the long term, we'll be able to continue to manage it. But quarter-to-quarter, there can be leading and lagging impacts of that.

William Grippin

Appreciate that color. And then maybe a bit of a long shot here. Are you able to share how much PRASA contributed in the third quarter to the top line?

Kenneth Bockhorst

No, we're not going to get into that. I think the other thing, William, that's important to notice, too, is throughout the year, we have won other projects, too, like the year has gone on and been normal. So I know there's a lot of focus on PRASA and rightfully so because it's very large. But the year has played out really well and really, I guess, normalized for us. So we're not going to get into quarter-by-quarter any project on what it is, but we're happy that we've seen these projects beginning to start. And what that does is quarter-to-quarter can be uneven. But how we look at the business over the 5-year horizon, we feel fantastic that these are all now moving to in-flight status.

Operator

The next question comes from Michael Fairbanks with JPMorgan.

Michael Fairbanks

On one of those last points you made, Ken, beyond the cohort of projects that you've talked about extensively, how would you say the pipeline and awards or even backlog beyond that are trending compared to this time last year?

Kenneth Bockhorst

Yes. So throughout the past several years, when we look at the universe of utilities that are currently working with consultants to scope out doing metering projects, which are revenue later in our 5-year horizon or the people that are currently in RFP that are going through the selection processes up to and including in-flight projects, that whole piece feels as robust as it has over the past several years.

Michael Fairbanks

Okay. Great. And then we saw share buybacks accelerate this quarter. How are we thinking about capital allocation from here?

Kenneth Bockhorst

Yes. So our capital allocation priorities remain the same. So we're going to continue to invest in the business and extend our lead in R&D and innovation. We're going to continue to return cash to shareholders and 34 years of increased dividends. We're certainly in a position to continue on that trend.

And in terms of share buybacks, we still have $35 million on the authorization. Even before this period when we weren't buying shares, we've always had an authorization open. So -- so I would imagine as long as we feel great about our superior position of being a cash generator, we'll be able to do that. And this year, we also did a really exciting acquisition. So regardless of this being a pretty challenging year for us, we've been able to navigate through this, execute on all 3 of our important capital allocation priorities, and we'll continue to do that going forward.

Operator

We have now reached the end of the Q&A session. I will now turn the call back to Dan Weltzien for closing remarks.

Daniel Weltzien

Thank you, operator. Just a quick note for your planning purposes that our year-end 2026 earnings release is tentatively scheduled for January 28, 2027. Feel free to reach out to me if you have any follow-ups at investors@badgermeter.com. Have a great day.

Operator

This concludes today's call. Thank you for attending. You may now disconnect.