24-09-2020

Graham Corporation awarded four new orders

Graham Corporation, a global business that designs, manufactures and sells critical equipment for the oil refining, petrochemical and defense industries, today announced that it secured $17.5 million in orders for two defense projects and two oil refining projects. One of the oil refining projects is in India and the other is in North America.

James R. Lines, Graham’s President and Chief Executive Officer, commented, “We continue to execute well on our defense strategy. Orders for the defense industry continue to represent more than 50% of total backlog. The defense industry provides terrific visibility into procurement schedules which translates into improved multiyear planning for our operations. We expect to continue to build defense backlog across the remainder of the current fiscal year”. Mr. Lines continued, “In our commercial markets, we are successfully leveraging our large installed base and continue to create follow-on revenue demand. These projects can arise quickly without much visibility and can have conversion cycles that are between 6 to 12 months. The India order is the result of our restructuring and establishing a subsidiary in India enabling us to secure our second large refining order for that region.”

The defense projects are existing component orders for new naval vessels in two of the three programs that Graham already participates in. The majority of revenue from the navy orders is expected to convert beyond fiscal 2022. The project in India is a major refinery expansion that will increase throughput capacity 50%, while the other oil refining order is a metallurgical upgrade to equipment supplied by the company approximately 20 years ago.

The projects will all be recognized in backlog during the second quarter of fiscal 2021. The company expects approximately 5% of the new order total to convert to revenue during the remainder of fiscal 2021 and approximately 25% to convert in fiscal 2022, with the remainder converting to revenue beyond fiscal 2022.