Argan (AGX) 2027 財年第二季財報電話會議：營收達創紀錄的 3.84 億美元

Argan Inc. (NYSE: AGX) 公布截至 2026 年 7 月 31 日的 2027 財年第二季營收與盈餘均創歷史新高，主要得益於三大營運部門的業務活動全面提升。電力部門仍是主要的成長引擎，同時管理層提醒，部分營收提前至第二季實現，可能會限制第三季的季增幅度。

重點摘要

• 2027 財年第二季營收年增 62% 至創紀錄的 3.84 億美元，主要由電力部門的專案活動所推動。
• 淨利達創紀錄的 5,330 萬美元，或稀釋後每股盈餘 3.76 美元，高於去年同期的 3,530 萬美元或稀釋後每股盈餘 2.50 美元。
• 調整後 EBITDA 從 3,850 萬美元增至 7,000 萬美元，調整後 EBITDA 利潤率從 16.2% 擴大至 18.2%。
• 截至 2026 年 7 月 31 日，在手訂單金額為 25 億美元，低於 2027 財年初的 29 億美元。管理層預計未來 7 至 15 個月內將新增少數幾項專案。
• 截至季末，Argan 持有約 10 億美元的現金與投資，淨流動資金為 4.4 億美元，且無任何負債。
• 管理層預計 2027 財年營收將顯著高於 2026 財年，但表示第二季強勁的業務活動可能導致第三季的季增幅度有限。

關鍵財務結果

2027 財年前六個月，營收成長 56.5% 至 6.749 億美元。淨利從去年同期的 5,780 萬美元（或稀釋後每股盈餘 4.09 美元）增至 9,940 萬美元（或稀釋後每股盈餘 7.01 美元）。調整後 EBITDA 為 1.265 億美元，利潤率為 18.7%，而去年同期分別為 7,000 萬美元及 16.2%。

業務與營運表現

電力部門

電力部門營收成長 53% 至 3.01 億美元，佔合併營收的 78%。稅前帳面利潤為 6,600 萬美元，部門毛利率達 22.4%。

Argan 在電力方面的在手訂單包括四座美國燃氣電廠，總裝機容量超過 4.1 吉瓦 (GW)。該公司正在推進為德州 SLEC 興建的 1.2 吉瓦複循環電廠、1.4 吉瓦 CPV 專案、86 百萬瓦 (MW) 德州專案以及 700 百萬瓦的美國複循環設施。

在國際市場方面，愛爾蘭的兩項專案持續推進：為 SSE Thermal 興建的 300 百萬瓦 Tarbert 新一代電廠，以及一座 170 百萬瓦的熱力設施。

總在手訂單中，天然氣專案約佔 80%，可再生能源專案佔 11%，工業工程佔 8%。管理層預計在近中期內，複雜的複循環專案將佔據大部分在手訂單。

工業部門

工業部門營收成長 111% 至 7,600 萬美元，佔合併營收的 20%。稅前帳面利潤約為 400 萬美元，毛利率為 7.3%。

該部門在手訂單總額為 2.1 億美元。Argan 正於北卡羅來納州興建第二座製造工廠，主要用於支援一項價值 1.25 億美元的資料中心合約，該合約涉及熱膨脹與儲能罐。管理層預計該工廠將於 2027 財年第三季完工。

該公司還在阿拉巴馬州推動一項回收與水處理廠專案。管理層看好資料中心、電力相關工業工程及製造服務領域的額外商機。

數據通訊部門

數據通訊部門營收成長 40% 至 700 萬美元，佔合併營收的 2%。毛利率為 16.6%。

Argan 在本季末收購了總部位於康乃狄克州的 Valcor Communications。此交易將該部門的業務擴展至新英格蘭地區，並新增了《財富》500 強中的科技、國防與航太客戶。管理層表示，有機成長、收購綜效以及戰略計畫的落實，潛在可使數據通訊部門營收相較 2026 財年水準翻倍，並支援未來幾個季度及更長遠的 EBITDA 成長。

管理層財測

管理層預計 2027 財年營收將大幅高於 2026 財年。然而，第二季各部門（特別是電力部門）的營收均超出公司先前預期，部分業務活動被提前實現。因此，第三季營收的季增幅度可能會受到限制。

預計在 2027 財年剩餘時間內，工業部門營收將從第二季的水準下滑。位於北卡羅來納州的新製造工廠預計將在本財年晚些時候及下一財年為工業部門營收帶來顯著貢獻，每季約增加 1,000 萬美元或以上。

Argan 預計未來 7 至 15 個月內將新增少數幾項專案。管理層認為其員工團隊和培訓管道可同時支援 10 至 12 項專案，不過產能仍取決於專案規模與複雜度。

風險與關注焦點

• 隨著較新的電力專案產生更多早期營收，合併毛利率已從 2026 財年第四季的 25.0% 降至 2027 財年第一季的 21.0% 及第二季的 19.3%。利潤率可能會隨著專案組合、施工階段及竣工時間而波動。
• 由於數個與資料中心合約無關的專案預估完工經濟效益下滑，工業部門利潤率低於管理層預期。這些專案應會在未來六個月內收尾，該部門利潤率可能會在未來一至兩個季度內繼續低於歷史水準。
• 由於專案執行與營收認列速度快於重大新電力訂單的獲取，在手訂單降至 25 億美元。管理層指出，在手訂單可能會因開工通知 (NTP) 的時間點而出現大幅波動。
• 新能源與資料中心專案取決於多項里程碑，包括購電協議、許可證、天然氣與水源取得、渦輪機供應情況以及融資到位。
• 收購 Valcor Communications 給數據通訊戰略帶來了整合與執行風險。
• Argan 通常採用固定價格合約，使合約選擇、人工成本、通膨以及特定地點的執行風險成為重要的考量因素。

分析師問答亮點

專案管道：管理層提到收到了大量主動諮詢，但對在手訂單仍保持保守態度。上半財年，因工程範圍擴大、較小的新專案及季度內營收所增加的 2.6 億美元以上金額，有助於抵銷在手訂單的轉化消耗。

招聘與產能：員工人數創下歷史新高，且顯著高於去年同期。Argan 持續在所有三個業務部門招聘和培訓員工，同時維持可同時執行 10 至 12 項專案的產能估算。

資料中心與監管環境：儘管有報導指出暫停與阻力影響了資料中心開發，但管理層表示尚未觀察到開發商行為有所改變。Argan 繼續為多位開發商提供早期服務。

電力部門利潤率：管理層將第一季與第二季電力部門毛利率均超過 22% 歸因於成功執行及專案提前完工。未來的利潤率仍將對專案組合和施工階段保持敏感。

資本配置：2027 財年前六個月，Argan 向股東回饋了 5,170 萬美元。其季度股利為每股 0.50 美元，折合年股利為 2.00 美元。股票回購授權總額為 2 億美元，期限至 2030 年 1 月 31 日；自該計畫啟動以來，已透過回購向股東回饋約 1.238 億美元。

法說會完整逐字稿

完整財報電話會議逐字稿

管理層陳述

Operator

Good evening, ladies and gentlemen, and welcome to the Argan Inc. Earnings Conference Call for the Second Quarter of Fiscal Year 2027 ended July 31, 2026. This call is being recorded.

[Operator Instructions]

There is a slide presentation that accompanies today's remarks, which can be accessed via the webcast. At this time, it is my pleasure to turn the floor over to your host for today, Jennifer Belodeau of IMS Investor Relations. Please go ahead, ma'am.

Jennifer Belodeau

Thank you. Good evening, and welcome to our conference call to discuss Arden's results for the second quarter of fiscal 2027 ended July 31, 2026. On the call today, we have David Watson, Chief Executive Officer; and Josh Baugher, Chief Financial Officer. I'll take a moment to read the safe harbor statements made during this conference call and presented in the presentation that are not based on historical facts are forward-looking statements. Such statements include, but are not limited to, projections or statements of future goals and targets regarding company's revenues and profits. These statements are subject to known and unknown factors and risks.

The company's actual results, performance or achievements may differ materially from those expressed or implied by these forward-looking statements and some of the factors and risks that could cause or contribute to such material differences have been described in this afternoon's press release and in Argan's filings with the U.S. Securities and Exchange Commission. These statements are based on information and understandings that are believed to be accurate as of today, and we do not undertake any duty to update such forward-looking statements.

Earlier this afternoon, the company issued a press release announcing its second quarter fiscal 2027 financial results and filed its corresponding Form 10-Q report with the Securities and Exchange Commission. Okay. With that out of the way, I'll turn the call over to David Watson, CEO of Argan. Please go ahead, David.

David Watson

Thanks, Jennifer, and thank you, everyone, for joining today. I'll start by reviewing some highlights of our operations and activities in Josh Baugher our CFO will go over our financial results, then we'll open up the call for questions. Our strong second quarter built on the momentum we created in the first quarter of fiscal 2027, demonstrating our operational strength across our business. Each of our operating segments recorded substantially improved revenue, contributing to our record consolidated revenue of $384 million for the quarter.

Our Power and Industrial segments delivered significant revenue growth of 53% and 111%, respectively, for the quarter, with Teladata revenue growing 40%. Our second quarter highlights include consolidated gross margin of 19.3%, record net income of $53.3 million or $3.76 per diluted share record adjusted EBITDA of $70 million and adjusted EBITDA margin of 18.2%.

We also executed at the end of the quarter on M&A with the purchase of Valcore Communications a Connecticut-based provider of installation and repair services for information, communication and data networks. We're excited about the addition of ValCor, which strengthens our Tele data segment giving us a presence in New England and bringing a client base of Fortune 500 technology, defense and aerospace customers from the region.

Our balance sheet remains strong with approximately $1 billion of cash and investments, net liquidity of $440 million and no debt at July 31, 2026, and we continued our practice of returning capital to our shareholders through our quarterly dividend of $0.50 per share, which is $2 per share on an annual basis. So a very strong quarter overall with a lot of progress made.

Now on to the operational review. We have 3 reportable business segments: power, industrial and tele data. Our Power segment is our largest, building all types of power facilities, including thermal and a variety of renewables, including solar, solar with battery energy storage systems, biofuel and biomass facilities. Power segment revenues grew 53% and contributed $301 million or 78% of total revenue in the second quarter of fiscal 2027 with pretax book income of $66 million.

The Industrial segment provides field services supporting new plant construction and additions for industrial facilities and fabricated metal components like piping systems and pressure vessels in its fabrication facility. Revenue increased by 111% to $76 million in the second quarter or 20% of consolidated revenue with pretax book income of approximately $4 million. Backlog for the Industrial segment was $210 million at July 31, 2026, and construction on our second fabrication facility is progressing well.

Finally, revenue in our Tele data segment grew 40% to $7 million in the second quarter of fiscal 2027 and contributed 2% of consolidated revenue. Tele data provides project management and construction services across power distribution and information, communications and data networks for commercial and industrial customers. The segment works with data centers as well as with federal government locations and military installations requiring high-level security clearance.

As I just mentioned, we expect that our recent acquisition of Valcor will expand and extend our reach as a provider of Teledata services.

Turning to our backlog. Our consultant backlog of fully committed projects is $2.5 billion at July 31, 2026, and a decrease from $2.9 billion at the start of fiscal 2027. As you all know, we take a conservative approach to reporting backlog and typically only include the value of a contract and backlog when we've received a notice to proceed. Because of that, our backlog amount will move around from quarter-to-quarter related to the completion of certain projects and start time of pending projects.

Our pipeline remains exceptionally strong, reflecting the demand for the reliable 24/7 energy resources needed to power an economy that is increasingly reliant on electrification. Demand for our capabilities across all 3 operating segments is high, particularly in our Power segment, where our current backlog includes 4 gas-fired power plants in the United States, totaling over 4.1 gigawatts.

Our Industrial segment is also seeing strong demand, highlighted by a data center contract we were awarded in November 2025 for the fabrication of thermal expansion and energy storage tanks. As we discussed on last quarter's call, we are currently building an additional fabrication facility in North Carolina to support this project and to better position the company to address new opportunities. The new facility is on track for completion later this year.

As we move forward, we remain confident in our expectation that we will add a handful of new projects over the next 7 to 15 months. With the timing of our projects and the teams we have in place as well as those that are in training, we believe we are well positioned to execute on 10 to 12 jobs simultaneously. There continues to be a great deal of media and industry coverage around a significant increase in power demand due to the electrification of our economy. This dynamic includes the onshoring of domestic manufacturing, the use of EVs and the building of data centers, all of which are driving urgency around the build cycle for additional energy infrastructure to support an already stressed power grid.

Gas-fired plants are widely recognized as the ideal solution for delivering reliable, uninterrupted power and there are a limited number of firms, including Argan, who have the capabilities to successfully execute these complex construction projects. Despite some recent regulatory back and forth around data center development that's been in the news, the demand environment for our services remains very strong and that, combined with our proven track record is allowing us to remain selective in pursuing the right projects in the right locations with the right partners.

Our backlog is currently composed of approximately 80% natural gas projects, 11% renewable and 8% industrial. With the current demand of natural gas-fired facilities and our core competencies in building these types of projects, we expect complex combined cycle projects, which will represent the majority of our backlog for the near and midterm.

Renewable energy still plays an important role as a power resource. And we subscribe to an all of the above approach when it comes to power generation. We plan to maintain our renewable capabilities so that we remain competitively positioned to meet market demand and customer needs, but our core activities will center around natural gas builds.

Slide 7 highlights the selection of our major projects currently underway or recently awarded. As you know, during the first quarter, we reached substantial completion ahead of schedule on the final project of our 3-part Midwest solar and battery projects and now that project has reached final completion. In addition, we expect to reach substantial completion ahead of schedule for our 405-megawatt Midwest solar project later this month. Given the complexity of our projects, our ability to reach early completion milestone shows the high level proficiency of our teams and staying on task and on schedule, delivering excellent execution throughout a multiyear project.

In Texas, our 1.2-gigawatt ultra-efficient combined cycle natural gas fire plant for SLEC is moving forward as expected, and construction is ramping at our 2 other gas-fired projects in Texas the 1.4 gigawatt project with CPV and our 86-megawatt project. We're also making good progress on our 700-megawatt combined cycle natural gas fired power plant in the U.S.

Looking internationally, our 2 projects in Ireland, the Tarbert next-generation power station, a 300-megawatt biofuel plant for SSE Thermal and our 170-megawatt thermal facility are progressing well. As I mentioned earlier, our Industrial segment has a $125 million data center project underway and is also working on the recycling and water treatment plant in Alabama.

Our project portfolio is diverse in terms of scope, scale, complexity and location, but all of our teams approach each project with the highest commitment to excellent execution and our reputation as a reliable partner is a testament to that diligent approach.

With that, I'll turn the call over to Josh Baugher to take us through the financials for the second quarter and first 6 months of 2027. Go ahead, Josh.

Joshua Baugher

Thanks, David, and good evening, everyone. On Slide 8, we present our consolidated earnings for the second quarter and first 6 months of fiscal 2027 ended July 31, 2026. As David mentioned, we delivered record second quarter revenues of $384 million, an increase of 62% as compared to $237.7 million in the second quarter of fiscal 2026. The increase is primarily due to the activity ramp of certain projects in our Power segment. For the second quarter, Argan reported consolidated gross profit of approximately $74.2 million or a gross margin of 19.3% and Consolidated gross profit for the comparative quarter last fiscal year was $44.3 million, representing a gross margin of 18.6%.

The increase in gross profit and improvement in gross margin for the recently ended quarter was primarily driven by our Power segment, reflecting a shift in project and contract mix and strong project execution. Gross margins for our Power, Industrial and Tele segments were 22.4%, 7.3% and 16.6%, respectively, for the second quarter of fiscal 2027.

Consolidated gross margin has stepped down over the past 3 quarters from 25% in the fourth quarter of fiscal 2026 to 21% in Q1 of fiscal 2027 and now 19.3% in the second quarter. As you know, our margins will vary from quarter-to-quarter depending on several factors, including project mix and where our projects sit in their construction cycle. When we complete projects early, we typically have an opportunity to realize some margin benefit. We saw that dynamic with the early completion of a couple of our projects in the fourth quarter of fiscal 2026 and Q1 of fiscal 2027, which favorably impacted consolidated margin.

In the second quarter, our consolidated margin reflects earlier stage revenues for our current projects in the Power segment. As projects ramp and get into the second and third year of construction, we expect to see higher revenues and with successful execution, we have the opportunity to enhance margin.

Selling, general and administration expense of $17.4 million for the second quarter of fiscal 2027 and increase as compared to SG&A of $14.2 million for the comparable prior year period. However, as a percentage of revenue, SG&A decreased to 4.5% compared to 6% in the comparable quarter. Other income net for the 3 months ended July 31, 2026, was 10.1%, which primarily reflected investment income earned during the period. Net income for the second quarter of fiscal 2027 and was a record $53.3 million or $3.76 per diluted share compared to $35.3 million or $2.50 per diluted share for last year's comparable quarter.

Adjusted EBITDA in the second quarter of fiscal 2027 was $70 million or an adjusted EBITDA margin of 18.2% compared to adjusted EBITDA of $38.5 million or an adjusted EBITDA margin of 16.2%. Looking at our year-to-date performance, revenue for the first 6 months of fiscal 2027 increased by 56.5% to $674.9 million as compared to revenues of $431.4 million for the prior year period. Our consolidated gross margin of 20.1% for the first half of fiscal 2027 and increase as compared to gross margin of 18.8% for the first 6 months of fiscal 2026 primarily due to the same reasons described for the quarter.

SG&A expenses increased to $33.1 million for the first 6 months of fiscal 2027 as compared to $26.7 million for the first 6 months of fiscal 2026 and but decreased as a percentage of revenues to 4.9% as compared to 6.2% in the first half of last fiscal year. Net income for the 6 months of the fiscal year was $99.4 million or $7.01 per diluted share compared to $57.8 million of $4.09 per diluted share for the first 6 months of last fiscal year.

Adjusted EBITDA was $126.5 million or an adjusted EBITDA margin of 18.7% for the first half of fiscal 2027 and compared with adjusted EBITDA of $70 million or an adjusted EBITDA margin of 16.2% for the first half of fiscal 2026.

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

David Watson

Thanks, Josh. Our balance sheet remains strong with approximately $1 billion in cash and investments, generating meaningful investment yields at July 31, 2026. Our net liquidity was $440 million, and we had no debt. We believe that our balance sheet is a competitive advantage as it supports our growing operations organically and inorganically, expands bonding capacity and provides customers a reliable and bankable EPC partner.

Stockholders' equity was over $0.5 billion at July 31, 2026. This liquidity bridge demonstrates that our business model ordinarily requires a low level of capital expenditures. Our net liquidity of $440 million at July 31, 2026, an increase of $19 million compared to net liquidity of $421 million at January 31, 2026, as we returned $51.7 million of capital to our shareholders during the first 6 months of fiscal 2027.

Our capital allocation strategy is disciplined and focused on 4 core areas. First, we invest organically in the business. That means developing and retaining our people and adding headcount to make sure we were staffed to execute on our projects. It also means expanding our capabilities, such as building a new fabrication facility in North Carolina to position ourselves for anticipated data center customer demand.

Second, the company pays a quarterly dividend, which we increased 33% to $0.50 per common share in September 2025, bringing us to an annual dividend run rate of $2 per share. The increase represented our third consecutive year of raising our quarterly dividend, which cumulatively has increased by 100%, reflecting the strength of our business and our commitment to returning shareholder value. We have had a share buyback program in place since November of 2021. And during the first quarter of this fiscal year, our board increased the total repurchase authorization to $200 million and extend its expiration date through January 31, 2030. Since the program's inception, we have returned a total of approximately $123.8 million to shareholders through the repurchase program.

Finally, we seek M&A opportunities that could be additive or complementary to our current platform. Our acquisition of Valcor Communications is a great illustration of that strategy, giving us a presence in New England and expanding our client base to include the Fortune 500 technology, defense and aerospace companies in that region. We're excited about this addition and its anticipated contributions. We are energized by the demand we're seeing for our capabilities across all 3 business segments.

With our skill set and excellent track record of execution, Argan is well positioned to capitalize on the opportunities presented by the urgent need for power infrastructure after a prolonged period of underinvestment and unprecedented increases in the demand for power. While we are energy agnostic and believe renewable will always have a role in power generation, gas-fired plants are integral to the reliable delivery of the uninterrupted 24/7 energy needed to power our economy.

The demand pipeline for complex combined cycle natural gas fire plants is substantial and we are one of only a few companies with the construction capabilities and proven track record of exceptional execution in building these facilities. We are excited for what lies ahead and intently focused on leveraging our teams, our solid financial position and our excellent reputation in the marketplace to expand our leadership position as a premier builder of industrial and energy infrastructure.

As always, I'd like to thank our entire team for their hard work and dedication to operational excellence. They are the core driver of our company's growth and success. I also thank our shareholders for their continued support and confidence in our company. With that, operator, let's open it up for questions.

Operator

[Operator Instructions]

The first question is from Rob Brown with Lake Street Capital Markets.

分析師問答

Robert Brown

Congrats on all the progress. First wanted to talk a little bit the pipeline looks like your commentary was about maybe a more near-term kind of execution pipeline. But could you kind of characterize the activity there and the number of projects or a sense of the projects that you're looking at?

David Watson

Absolutely, Rob, and thanks for the question. We have, historically, as you know, have been very conservative about predicting where our backlog can go and we're going to stick with that approach. We did say we expect to add a handful of new projects over the next 7 to 15 months and that reflects the current demand for natural gas-fired facilities. And we expect these complex buying cycle projects will represent the majority of our backlog for the near and midterm, but there will also be simple cycles as well.

As you know, we constantly are evaluating projects that meet the right time, conditions and best fit for our organization, and we have a significant number of inbound requests for our services. So I can't give a precise guideline at this time on new jobs. The reality is our next job could come next quarter or a year from now. And as you know, backlog performance can vary quarter-to-quarter depending on the timing of your projects.

We are pleased to keep the backlog over $2.5 billion despite not adding any major power projects in the quarter, given that we generated $675 million of revenue during the first 6 months. And I think it's important to note that we're able to offset some of that backlog burn with $260-plus million of additions through scope increases on existing jobs, adding new smaller jobs across the organization and intra-quarter revenues?

Robert Brown

Okay. Great. And then on the new facility build-out, I think you talked about some data center kind of market opportunity that, that opens up to you. Could you give us a sense of what sort of the revenue capacity is in that new facility and maybe some of the markets you're going after with it?

David Watson

Absolutely. Just the construction on that facility is going really well, and we expect to have that complete in Q3, which, to me, is a pretty significant acceleration and quick time line for building a new fabrication facility. Right now, it's primarily geared towards supporting that $125 million data center project that we're fabricating thermal expansion and entry storage change, and we expect a number of follow-on opportunities with that customer and frankly, expect that this facility will position the company for additional demand that we're seeing across our space.

So right now, obviously, there is any revenue coming out of that facility as it's still in construction phase, but we do expect for it to have a meaningful uptick in revenues for our industrial group later this year and into the next year around $10-plus million a quarter.

Operator

The next question comes from Chris Moore with CJS Securities.

Christopher Moore

Congrats on another great quarter. a couple. So one of the things you've talked about previously with respect to expanding and capacity capabilities is just the need for to keep hiring and training new people. So I'm just trying to get a sense in terms of maybe where you are today from a employee account perspective versus perhaps a year ago? And where do you expect to be a year from now?

David Watson

Chris, appreciate the question. Jim is every month breaking new records of the number of employees that they have. It is a constant process to add and train to the organization to train folks in the away, and we constantly are adding folks. I think one of your questions might relate to what's our capacity of the number of jobs that we can take on. I'm still going to guide that capacity to 10 to 12 jobs at any one time, keep in mind a 2-gigawatt job is not the same as, say, a 500-megawatt job. So there could be some variability there ultimately.

But we continue to gear towards expanding that organization. Frankly, we're expanding all of our organizations in all of our business segments and our headcount is at record levels and meaningfully above where they were a year ago.

Christopher Moore

Got you. I appreciate that. Industrial gross margin was 7.3%. Is there -- maybe you could talk about that and certainly below kind of normal levels. Is there some cost from the expansion that's embedded in there? Or just what happened this quarter and kind of a more normalized level?

David Watson

Yes. I mean revenue grew -- it's obviously a record quarter in revenue, north of $70 million. I mean it grew year-over-year, 11%. A -- but you're correct. The margin profile was below our expectations. And frankly, there were a couple of projects unrelated to our data center work where the estimates to complete became below where we initially estimated at the project inception, which impacted our gross margins during the quarter. We expect to finish these projects over the next 6 months.

So industrial margins may run below historical norms for a quarter or 2 as these projects wind down. We're working hard to improve the economics of these projects as we expect strong execution across our teams regardless of the project challenges they face. Beyond that, we see a lot of exciting opportunities in our Industrial segment similar to what I said to Rob, especially in the data center market and frankly, in the power market for industrial as well as pairing that with our fabrication capabilities. And we'll remain focused on selecting the right projects and executing them profitably. So we're working through a couple.

Christopher Moore

Got it. And maybe just the last one for me. I think you kind of referenced this, and certainly, demand looks really strong. I mean the Texas governor, Greg abetrecently talked about halting 1,800 data center projects if there are grid requests for, I don't know, 5x all-time peak demand. I guess the question is any impact that you're seeing in Texas and just overall and any impact at all from kind of some -- more on the political side.

David Watson

Chris, there is still an urgency to get data centers and power plants built. And you're correct, there has been a lot of news lately with pauses and pushbacks on data centers. But there has really been no change in terms of developer behavior. It's still a matter of the developer being able to achieve all those milestones that we've talked about, right, such as getting power purchase agreements in place with an end user such as a hyperscaler, air permits access to gas, water permits, turbines, financing, et cetera.

We continue to work with several developers often through service arrangements on early activities as we anticipate kicking off some new projects over the next 7 to 15 months. So the there new there, but we're not seeing a change in behavior. -- and expect to be -- obviously, expect to add more backlog in the future here.

Christopher Moore

Sounds good. I will leave it there. I appreciate it.

David Watson

Thanks, Chris.

Operator

The next question is from Michael Fairbanks with JPMorgan.

Mark W. Strouse

This is Mark Strouse on for Michael. David, I believe you said earlier this year, I'm just kind of thinking about revenue sequencing earlier this year, I believe you said that you were expecting kind of sequential increases throughout the year. Just given the strength that you saw in 2Q, do you still think that you're going to grow during the second half of the year compared to 2Q?

David Watson

Mark, great question. Thanks for jumping on for Michael. It's clearly, it's our expectation that we will be meaningfully higher than fiscal year '26. We were able to achieve greater revenues than anticipated in Q2 across all of our business segments and especially in Power as such that some of this pull forward in Q2 may result in limited quarter over consecutive quarter growth in Q3, especially since we anticipate decreased industrial revenues compared to Q2, the rest of the year.

So as you know and as I've mentioned before, our revenues do move around related to where we are in the various construction phases of our projects underway. So we will see an impact from the timing of new project starts completion of projects and where we are in existing projects. So again, fiscal year '27 is expected to be significantly above fiscal year '26. The pace of revenue growth it's tough to tell, but you are correct. We did pull forward -- we did have a really strong revenue quarter in Q2.

Mark W. Strouse

Okay. And then just as a follow-up, I wanted to ask about your latest thoughts on pricing. -- specifically within the Gema business. So the combined cycle gas turbine OEMs are still talking about pricing increasing. Curious what you can say either specific to your own business or kind of what you're seeing across the industry, that would be helpful.

David Watson

It still comes down to the type of contract comes down to the location, certain labor locations are much more significant than others when it comes to cost and getting the labor. So we believe our approach is appropriate as we take into consideration the market, we take in consideration inflation, labor costs, other risk factors in the contract type.

We typically do fixed-price contracts, as you know, Merck. So price -- I mean our margin profile that we've recorded over the last 3 quarters as Empower has been north of 2% and we expect for our contracts in the future to have meaningful pricing based off of the current market. But I wouldn't say that there is an ability to command higher pricing just because the market is evolving, but I do think we're able to get the right prices.

Operator

The next question comes from Alexa Bruno with Goldman Sachs.

Unknown Analyst

We wanted to ask on the power margins. The strength we saw this quarter -- how should we think about it? Was it driven by project execution milestones? Or is this more normalized baseline expectations? What are some of the moving pieces there?

David Watson

Alexa, thanks for the question, and thanks for joining us on the call. Our margins will vary from quarter-to-quarter depending on several factors including project mix, where we are in projects, where the projects sit in the construction cycle. We just completed power margins in Q2 or 22.4%. In Q1, they were 23.6%. So again, healthy north of 22% in both of those quarters. And some of that relates to completing some projects early. And so that's been beneficial when you're not incurring additional cost with due to the length of the project that can be beneficial.

But our overall margin outside of power was a little bit less than we were expecting but we remain confident in our ability to continue executing on our projects and capitalizing on opportunities in our pipeline to drive continued strong margins.

Unknown Analyst

Okay. That's very helpful. And then just a follow-up on the Valcor acquisition. Can you talk about the opportunity set there? And then how should we think about the potential for any further bolt-on M&A?

David Watson

Yes. We clearly have not done a lot of M&A over the last 10 years. So we were pleased to get Valcor to the finish line and to enhance our Tele data segment because we believe there will be synergies. And with organic growth and the synergies of Valcor and the progression on our strategic plan, it should result in a significant increase in our revenue run rate for Tele data, and frankly, which we expect to potentially double revenues from fiscal year '26 and drive EBITDA growth over the next couple of quarters and beyond.

There's obviously, with any M&A, there's risk of integration and continued execution of the Teledata strategy. And then, of course, as in everything, ensuring execution excellence. But we are excited about that business segment and how we can diversify our revenues and enhance shareholder value. And this success with this while it's albeit that it's a small acquisition as a reminder to the investing public that Argan does do M&A, though we are very stringent and picky as to when we do that but it is definitely one of our core capital allocation pillars in addition to buybacks and dividends and more importantly, investing in organic growth?

Unknown Analyst

That's very helpful. We'll turn it back.

Operator

We have no further questions in queue. I would now like to turn the floor back over to David Watson for closing remarks.

David Watson

Well, none of this was made possible without all the hard work that all of our teams in the field, all of our teams in the segments and the companies that are doing all this hard work. So I want to, again, thank each and every one of you for all of your efforts. And I also want to thank all of those participating in today's call. and we look forward to speaking with you again when we report third quarter fiscal 2027 results. Have a great evening.

Operator

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.