Graham Corporation (NYSE:GHM), a manufacturer of industrial machinery, has updated its executive cash bonus program for fiscal year 2025, as disclosed in a recent SEC filing. On Monday, the company's board amended the Annual Executive Cash Bonus Program, affecting the potential payouts for its top executives based on the achievement of specified company and individual performance objectives.
Under the new scheme, President and CEO Daniel J. Thoren could earn a bonus equivalent to 100% of his base salary, while Vice Presidents Christopher J. Thome and Matthew Malone may receive bonuses up to 50% of their respective base salaries. The bonus payouts can range from 0% to 200% of the target level, contingent upon the attainment of the pre-set goals.
The performance goals for fiscal 2025 are weighted with 50% based on adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), 20% on bookings, and 30% on personal goals. For Thoren and Thome, the adjusted EBITDA and bookings are calculated on a consolidated basis, whereas for Malone, they include both consolidated (15% for EBITDA, 6% for bookings) and divisional (35% for EBITDA, 14% for bookings) numbers.
The information is based on a press release statement and provides insights into the company's strategy for executive remuneration.
In other recent news, Graham Corporation has reported a robust financial performance for fiscal year 2024, marking its highest-ever revenue and orders. The company's strong quarter was characterized by substantial profitability and robust cash flow, aided by the completion of key naval nuclear propulsion program orders.
Strategic initiatives such as the acquisition of P3 Technologies and a $13.5 million investment to increase production capabilities have positioned the company for future growth.
Graham Corporation's record revenue stood at $185.5 million with a gross margin of 21.9% for fiscal 2024. The company also reported significant increases in net income and adjusted EPS, with net income at $4.6 million and adjusted EPS up by 163% to $0.63. Furthermore, the company paid off all outstanding debt and generated $28.1 million in cash.
Looking forward, Graham Corporation projects its revenue for fiscal year 2025 to range from $200 million to $210 million, with an adjusted EBITDA forecast of $16.5 million to $19.5 million. The company also plans to break ground on a new facility in July to support its expansion plans.
These are among the recent developments for Graham Corporation.
InvestingPro Insights
In light of Graham Corporation's (NYSE:GHM) recent update to its executive cash bonus program, it's pertinent to consider the company's financial health and market performance. According to InvestingPro data, Graham Corporation holds a market capitalization of $322.42 million and has demonstrated a notable revenue growth of 18.09% in the last twelve months as of Q4 2024. This growth aligns with the company's focus on performance metrics as it adjusts its executive compensation structure.
InvestingPro Tips suggest that Graham Corporation trades at a high earnings multiple, with a P/E ratio standing at 69.87, indicating investor confidence in its future earnings potential. Additionally, the company's cash flows are robust enough to cover interest payments, a reassuring sign of financial stability. For investors interested in the company's valuation, Graham Corporation is trading at a high EBITDA valuation multiple, reflecting the market's valuation of its profitability and cash generation capabilities.
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