NWPX Q3 Sales Reach $179.4 Million on Water Transmission Growth

Northwest Pipe Company (NASDAQ: NWPX) reported combined segment net sales of $179.4 million for the third quarter of 2026, up about 19% from the prior-year period, as higher Water Transmission Systems revenue offset broadly stable sales in Precast Infrastructure and Engineered Systems. The company also ended September with a $435 million Water Transmission Systems backlog including confirmed orders, supporting visibility across its core water infrastructure business.

Water transmission drives quarterly growth

Water Transmission Systems revenue increased to $131.9 million from $103.9 million in the third quarter of 2025, a gain of roughly 27%. The segment’s gross margin was 22%, compared with 21% a year earlier.

Precast Infrastructure and Engineered Systems generated $47.5 million in revenue, compared with $47.2 million in the prior-year quarter. Its gross margin was 23%, up from 21%.

The Water Transmission Systems backlog includes projects for which NWPX has been notified that it is the successful bidder, even when a binding agreement has not yet been executed. The Precast segment’s order book stood at $67 million on September 30. Serpentix Conveyor, acquired during the quarter, contributed $10 million to that total, including $8 million of remaining performance obligations for which revenue is recognized over time.

NWPX said demand is supported by long-term investment requirements for aging water and wastewater systems, population growth, water scarcity and regulatory requirements. The company cited federal and state funding programs as a favorable backdrop, while noting that state and local governments account for most public water investment.

The presentation also identified a pipeline of potential Water Transmission Systems work across the United States. Projects expected to reach bidding stages include pipeline programs in Texas, Illinois, Colorado, North Dakota, Ohio and Florida, as well as larger western programs in Nevada, California and New Mexico. These opportunities remain subject to project schedules, funding decisions, bidding outcomes and possible modifications or cancellations.

Serpentix expands wastewater platform

NWPX completed its $51.5 million acquisition of Serpentix Conveyor on September 2. Serpentix designs and manufactures engineered conveyor systems for municipal wastewater treatment plants and industrial manufacturing facilities and had approximately $15.6 million of trailing-12-month revenue through June 30, 2026.

The company said the transaction expands its wastewater treatment capabilities by adding engineered conveyors, automation and fabrication expertise. NWPX expects the acquisition, completed at approximately 9.1 times EBITDA, to be immediately accretive to earnings.

The purchase followed NWPX’s February 2026 acquisition of Boughton’s Precast. Both transactions form part of a broader strategy to expand the Precast business through acquisitions, additional capacity and the production of NWPX Park products at existing facilities. The company is also increasing utilization at its Texas plants, expanding outside sales coverage and producing NWPX Park products at its Utah operations.

Free cash flow expected at $62 million to $72 million

NWPX projected 2026 free cash flow of $62 million to $72 million, after generating $56 million through the first nine months of the year. Free cash flow is defined as cash flow from operating activities less capital expenditures.

Management attributed its cash-generation performance to a better cash conversion cycle, stronger EBITDA from stabilized margins, disciplined capital spending and efforts to accelerate Water Transmission Systems billings. Annual free cash flow was $47.1 million in 2025, $34.3 million in 2024 and $35.2 million in 2023.

The company continues to prioritize organic investment and acquisitions, particularly in precast-related markets. It is reinvesting in Precast facilities to expand capacity and automation, while maintaining a longer-term goal of building the segment to a size comparable with Water Transmission Systems.

NWPX also repurchased approximately 44,000 shares for $3.7 million during the first nine months of 2026. As of September 30, $12.7 million remained under its share-repurchase authorization.

The company’s operating priorities remain focused on workplace safety, cost reductions, production efficiency and margin over volume. Key uncertainties include changes in product demand and pricing, order timing, bidding activity, raw-material availability, trade policy, inflation, interest rates and construction-market conditions. NWPX also identified acquisition integration, supply-chain constraints, labor availability, cybersecurity events and disruptions at manufacturing facilities as factors that could cause actual results to differ from management’s expectations.