Downers Grove, Illinois, April 29, 2026 — Federal Signal Corporation (NYSE:FSS) (the “Company”), a leader in environmental and safety solutions, today reported financial results for the first quarter ended March 31, 2026.
First Quarter Highlights
Consolidated net sales for the first quarter were $626 million, an increase of $162 million, or 35%, compared to the prior-year quarter. Net income for the first quarter was $70.4 million, or $1.14 per diluted share, compared to $46.3 million, or $0.75 per diluted share, in the prior-year quarter.
The Company also reported adjusted net income for the first quarter of $72.7 million, or $1.18 per diluted share, compared to $47.0 million, or $0.76 per diluted share, in the prior-year quarter. The Company is reporting adjusted results to facilitate comparisons of underlying performance on a year-over-year basis. A reconciliation of these and other non-GAAP measures is provided at the conclusion of this news release.
First Quarter Outperformance Represents Strong Start to the Year; Raising EBITDA Margin Targets for the Safety and Security Systems Group
“Our first quarter results exceeded our expectations, with our businesses delivering 35% year-over-year net sales growth, 52% operating income improvement, and a 190-basis point increase in adjusted EBITDA margin,” commented Jennifer L. Sherman, President and Chief Executive Officer. “Within our Environmental Solutions Group, we delivered 38% year-over-year net sales growth and a 46% increase in adjusted EBITDA. Production increases at several of our businesses, higher sales of our aftermarket offerings, proactive management of price/cost dynamics, and contributions from recent acquisitions were meaningful year-over-year growth drivers. Our Safety and Security Systems Group also delivered impressive results, with 22% top-line growth and an adjusted EBITDA margin of approximately 27%. With its consistently strong performance over the last several quarters, we are raising the EBITDA margin targets for our Safety and Security Systems Group to a new range of 22% to 28%, from the prior range of 18% to 24%.”
In the Environmental Solutions Group, net sales for the first quarter were $533 million, up $145 million, or 38%, compared to the prior-year quarter. In the Safety and Security Systems Group, net sales were $93 million, up $17 million, or 22%, compared to the prior-year quarter.
Consolidated operating income for the first quarter was $99.7 million, up $34.0 million, or 52%, compared to the prior-year quarter. Consolidated operating margin for the first quarter was 15.9%, up from 14.2% in the prior-year quarter.
Consolidated adjusted earnings before interest, tax, depreciation and amortization (“adjusted EBITDA”) for the first quarter was $126.3 million, up $41.2 million, or 48%, compared to the prior-year quarter, and consolidated adjusted EBITDA margin was 20.2%, up from 18.3% in the prior-year quarter.
In the Environmental Solutions Group, adjusted EBITDA for the first quarter was $113.3 million, up $35.8 million, or 46%, compared to the prior-year quarter, and its adjusted EBITDA margin was 21.3%, up from 20.0% last year. In the Safety and Security Systems Group, adjusted EBITDA for the first quarter was $24.7 million, up $7.9 million, or 47%, compared to the prior-year quarter, and its adjusted EBITDA margin was 26.6%, up from 22.0% last year.
Consolidated orders for the first quarter were $623 million, an increase of $55 million, or 10%, compared to the prior-year quarter. Consolidated backlog at March 31, 2026 was $1.04 billion, compared to $1.10 billion in the prior-year quarter.
Increased Operating Cash Flow Provides Flexibility to Fund M&A, Organic Growth Opportunities, and Cash Returns to Stockholders
Net cash provided by operating activities during the first quarter was $101 million, an increase of $65 million, or 176%, from the prior-year quarter.
At March 31, 2026, total outstanding debt was $552 million, total cash and cash equivalents were $71 million, and the Company had $939 million of availability for borrowings under its credit facility.
“Our operating cash flow generation during the quarter was up 176% compared to last year,” said Sherman. “With the increased cash generation and available capacity under our credit facility, we have significant financial flexibility to invest in organic growth initiatives, pursue additional strategic acquisitions, pay down debt, and provide returns to stockholders through dividends and opportunistic stock repurchases.”
The Company funded dividends of $9.2 million during the first quarter, reflecting an increased dividend of $0.15 per share, and recently announced a similar $0.15 per share dividend that will be payable in the second quarter of 2026.
Outlook
“Demand for our products and our aftermarket offerings remains strong,” noted Sherman. “With our better-than-expected first quarter performance, our current backlog, and continued execution against our strategic initiatives, we are raising our full-year adjusted EPS* outlook to a new range of $4.80 to $5.05, from the prior range of $4.50 to $4.80. We are also increasing our full-year net sales outlook to a new range of between $2.57 billion and $2.66 billion, from the prior range of between $2.55 billion and $2.65 billion.”
CONFERENCE CALL
Federal Signal will host its first quarter conference call on Wednesday, April 29, 2026 at 10:00 a.m. Eastern Time. The call will last approximately one hour. The call may be accessed over the internet through Federal Signal’s website at www.federalsignal.com or by dialing phone number 1-877-704-4453 and entering the pin number 13760128. A replay will be available on Federal Signal’s website shortly after the call.
About Federal Signal
Federal Signal Corporation (NYSE: FSS) builds and delivers equipment of unmatched quality that moves material, cleans infrastructure, and protects the communities where we work and live. Founded in 1901, Federal Signal is a leading global designer, manufacturer and supplier of products and total solutions that serve municipal, governmental, industrial, and commercial customers. Headquartered in Downers Grove, Ill., with manufacturing facilities worldwide, the Company operates two groups: Environmental Solutions and Safety and Security Systems. For more information on Federal Signal, visit: www.federalsignal.com.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995
This release contains unaudited financial information and various forward-looking statements as of the date hereof and we undertake no obligation to update these forward-looking statements regardless of new developments or otherwise. Statements in this release that are not historical are forward-looking statements. Forward looking statements should not be relied upon as a predictor of actual results. Such statements are subject to various risks and uncertainties that could cause actual results to vary materially from those stated. Such risks and uncertainties include but are not limited to: economic and political uncertainty, risks and adverse economic effects associated with geopolitical conflicts including tariffs and other trade conflicts, legal and regulatory developments, foreign currency exchange rate changes, inflationary pressures, product and price competition, supply chain disruptions, availability and pricing of raw materials, interest rate changes, risks associated with acquisitions such as integration of operations and achieving anticipated revenue and cost benefits, work stoppages, increases in pension funding requirements, cybersecurity risks, increased legal expenses and litigation results, and other risks and uncertainties described in filings with the Securities and Exchange Commission.
Contact: Ian Hudson, Chief Financial Officer, +1-630-954-2000, ihudson@federalsignal.com
* Adjusted earnings per share (“EPS”) is a non-GAAP measure, which includes certain adjustments to reported GAAP net income and diluted EPS. In the three months ended March 31, 2026 and 2025, we made adjustments to exclude the impact of acquisition and integration-related expenses, net, and purchase accounting effects, where applicable. In prior years, we have also made adjustments to exclude the impact of pension-related charges, debt settlement charges, special tax items, and certain other unusual or non-recurring items. Should any similar items occur in the remainder of 2026, we would expect to exclude them from the determination of adjusted EPS. However, because of the underlying uncertainty in quantifying amounts which may not yet be known, a reconciliation of our Adjusted EPS outlook to the most applicable GAAP measure is excluded based on the unreasonable efforts exception in Item 10(e)(1)(i)(B).
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