Worthington Enterprises Inc Q2 2026 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Kathryn Thompson - Thompson Research Group LLC - Analyst : First, I wanted to circle back on your acquisition of LSI, a similar strategy to Elgen. I wanted to just once again see if you can expand on the strategy for growth from here as you integrate both into the Worthington network. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 17, 2025 / 1:30PM, WOR.N - Q2 2026 Worthington Enterprises Inc Earnings Call Also importantly, how you see growth over these from a complementary standpoint, but also not just cost opportunities, but top line opportunities as you expand into the system.

Question: Kathryn Thompson - Thompson Research Group LLC - Analyst : And then a follow-up question. I appreciated the color on water tanks and it's something that you have mentioned before on earnings calls and public commentary just as areas that you benefit from data center and broadly reindustrialization. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 17, 2025 / 1:30PM, WOR.N - Q2 2026 Worthington Enterprises Inc Earnings Call What are other areas that, or just maybe help us further understand the opportunities that you're involved in that are data center centric.

Question: Kathryn Thompson - Thompson Research Group LLC - Analyst : And in terms of meaningful, is it percentage of sales that you can estimate that it may contribute?

Question: Daniel Moore - CJS Securities Inc - Analyst : I want to dovetail on Kathryn's question on LSI. Just looking at the margin profile, obviously, extremely healthy and over 40% adjusted EBITDA margin trailing 12 months. Just help us understand what drives that, how sustainable? And then maybe talk a little bit about kind of the, what are the key drivers behind 3% to 5% growth in the market? And a follow-up there.

Question: Daniel Moore - CJS Securities Inc - Analyst : The switching gears, Building Products, really solid growth, mid-teens on an organic basis. Maybe just talk about how much of that is pricing versus volume? And then you mentioned some of the end markets that obviously are driving that growth maybe as we get into the seasonally stronger period, your confidence that those demand drivers will continue here in the near to midterm.

Question: Daniel Moore - CJS Securities Inc - Analyst : Very helpful. Maybe one or two more. ClarkDietrich. Obviously, contribution hit kind of a new post-pandemic low for the quarter. Talk about what you're seeing there? How much of it was just top line versus maybe costs? And what steps can be taken to kind of protect margins from here, so we don't see that dip further?

Question: Daniel Moore - CJS Securities Inc - Analyst : Maybe last, just in terms of capital allocation that bought back some stock in the quarter at levels a little higher than where the stock has indicated this morning, still only a turn of leverage on a pro forma basis following LSI. So from here, would you prefer to delever? Or are you comfortable continuing to opportunistically return cash to shareholders and continue to explore tuck-in M&A?

Question: Susan Maklari - Goldman Sachs Group Inc - Analyst : My first question is talking about the momentum that you are seeing on the consumer side of the business. You mentioned that Balloon Time is now going to be available in Costco. Can you just give us a bit more color on some of these new partnerships that you're getting into that you're having success with? How much more maybe there is to go there? And then how we should think about the upside from all of this as we do get into the busier spring and summer next year?

Question: Susan Maklari - Goldman Sachs Group Inc - Analyst : That's great color. Good to hear all that. And then maybe switching to the COGS side of the business, you've done a really nice job on SG&A in the last several quarters. Can you talk a bit about the further opportunities there, where we are just as it relates to the Worthington Business Systems and any other upside either in SG&A or actually even in the COGS side of the business as well?

Question: Susan Maklari - Goldman Sachs Group Inc - Analyst : And then maybe I'm going to squeeze one more in, which is, it's really nice to see how well WAVE continues to do in this environment. Can you talk a bit about what they're seeing in that business? And anything in terms of the outlook that we should be aware of there?

Question: Walt Liptak - Seaport Research - Analyst : Hi, and looks like a good quarter with just a couple of things outside of your control. So Colin, I think you mentioned just at a high level, mix and construction being weaker. And I think on the construction side, you're referring more to ClarkDietrich, but what were you referring to on the mix side?

Question: Walt Liptak - Seaport Research - Analyst : I just wanted to make sure I wasn't missing something there. And then on the mix, too, I'm not totally sure I understand the pluses and minuses there because the mix sounds, especially in Building Products, like it was pretty good.

Question: Walt Liptak - Seaport Research - Analyst : And then just a follow-up on a previous question about ClarkDietrich. Are they getting into like a seasonally stronger period like these EBITDA levels? I think I heard you say is kind of stable. But then if it's seasonally stronger, do you get a lift going into the back half of the year for ClarkDietrich?

Question: Walt Liptak - Seaport Research - Analyst : And then third quarter last year, I remember that there was like some smaller gas containers that are used for heating that were strong. Is there a comp, a tougher comp that we should be thinking about and the weather seems like it's been colder in the last month or so. Are those small containers enough to be a plus or minus in the third quarter?