Federal Signal (FSS) Investor presentation summary

Company overview and business segments

• Operates two main segments: Environmental Solutions Group (ESG, 84% of FY25 net sales) and Safety and Security Systems Group (SSG, 16%).

• Maintains a diversified product portfolio with resilient end-market exposure and disciplined M&A strategy.

• Achieved an average 102% cash conversion over five years and maintains low net debt leverage (0.8x as of Q2 2026).

• 17 acquisitions since 2016 and 28 manufacturing locations globally.

Financial performance and outlook

• Net sales grew at a ~13% CAGR from 2016 to 2025, with organic growth at ~7%.

• 2026 net sales outlook raised to $2.58B–$2.67B, representing 18–22% YoY growth.

• Adjusted EPS guidance increased to $5.12–$5.30, marking another year of double-digit growth.

• Adjusted EBITDA margin reached 20.7% in 2025, with targets of 16–22% consolidated, 18–24% ESG, and 22–28% SSG.

• Free cash flow reached $339M in 2025, with strong cash conversion and liquidity.

Product and market leadership

• ESG leads North America in vacuum trucks, street sweepers, dump truck bodies, and multi-purpose maintenance vehicles.

• SSG holds #1 or #2 market share in industrial signaling, warning systems, and public safety equipment.

• Aftermarket sales represent ~25% of ESG net sales, growing at a 14% CAGR (2015–2025).

• Backlog-intensive products comprised ~45% of 2025 net sales, with target lead times of 4–8 months.