Advanced Drainage Systems demonstrated resilience in a tough market in Q3 FY2026, posting a strong 30.2% adjusted EBITDA margin, bolstered by its acquisition of NDS and a focus on high-margin products.
- Adjusted EBITDA rose 9% year-over-year despite flat revenues, reflecting effective cost management and product mix optimization.
- Allied product sales increased 8%, benefiting from new product launches in stormwater and water quality solutions.
- The acquisition of NDS expands the company’s offerings in stormwater management, positioning it as a leader in the sector.
- Nonresidential market sales grew 5%, yet the residential segment faced challenges with slight declines in activity.
- Updated market forecasts indicate a more cautious outlook for nonresidential demand, but opportunities remain for growth in residential markets as they recover.
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