Why This Matters to Distributors: Core & Main’s quarter shows that strong margin management and exposure to municipal infrastructure projects can drive earnings growth even when sales volumes are flat, highlighting the relative stability of waterworks and utility markets.
Core & Main reported higher first-quarter earnings despite flat sales, as the water infrastructure distributor benefited from margin expansion, disciplined pricing, and lower interest expense amid steady municipal demand.
Net sales for the fiscal first quarter ended May 3 were $1.91 billion, compared with $1.911 billion in the same period a year earlier, a decline of less than 0.1%.
Net income increased 7.6% to $113 million from $105 million in the prior-year quarter. Net income attributable to Core & Main rose 8.0% to $108 million from $100 million.
Gross profit increased 2.0% to $520 million from $510 million. Gross margin expanded by 50 basis points to 27.2% from 26.7%, reflecting the company’s pricing initiatives and purchasing discipline.
Operating income rose 3.5% to $177 million from $171 million. Selling, general and administrative expenses increased 2.0% to $299 million from $293 million, driven by higher distribution costs and investments in new locations and sales initiatives.
CEO Mark Witkowski said municipal demand remained healthy during the quarter, supported by repair-and-replace activity and infrastructure spending. The company reported double-digit growth in treatment plant solutions and high-single-digit growth in smart utility products.
By product category, sales of pipes, valves and fittings declined because of lower volume, while storm drainage sales also decreased. Fire protection product sales increased on higher volume and pricing, and smart utility product sales grew on stronger demand.
Operating cash flow totaled $82 million, up 6.5% from $77 million in the prior-year period.
Core & Main continued to invest in network expansion, opening five greenfield locations during the quarter.
Core & Main reaffirmed its fiscal 2026 outlook, projecting net sales of $7.8 billion to $7.9 billion, representing growth of 2% to 3%.
Based in St. Louis, Core & Main distributes water, wastewater, storm drainage and fire protection products to municipalities, utilities, and contractors through a network of more than 370 locations across the United States and Canada.
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