Franklin Electric Raises 2026 Outlook as Subsidiary Agrees to Buy Challenge Pumps

Franklin Electric raised its 2026 sales and adjusted earnings outlook after third-quarter revenue rose 9%, while its Australian subsidiary agreed to acquire an Australian mine-pump supplier for about $181 million.

The company now expects full-year net sales of $2.23 billion to $2.30 billion and adjusted diluted earnings per share of $4.62 to $4.82. Its July forecast called for sales of $2.21 billion to $2.29 billion and adjusted diluted EPS of $4.50 to $4.70.

Net sales totaled $633.6 million in the quarter ended Sept. 30, compared with $581.7 million in the same quarter a year earlier. Adjusted diluted EPS rose 15% to $1.50 from $1.31. GAAP diluted EPS was $1.35. Higher material and freight costs pressured margins.

CEO Joe Ruzynski said revenue growth reflected pricing, recent acquisitions and customer activity across much of the portfolio. Franklin Electric issued its results Wednesday at 8 a.m. ET (12:00 UTC).

Franklin Electric said its wholly owned Australian subsidiary, Franklin Electric (Australia) Pty Ltd, signed an agreement Oct. 27 to acquire all outstanding shares of Challenge Pumps Holdings Pty Ltd. The purchase price is about $181 million in cash, subject to purchase-price adjustments, plus up to $14 million tied to future revenue performance after closing.

Challenge Pumps, headquartered in Perth, supplies pumps for underground mine dewatering, engineered pumping systems and aftermarket services. For FY2026, which ended in June, it had about $52 million in revenue and $18 million in adjusted EBITDA. More than 55% of its revenue over the previous three years came from recurring parts and service activity.

Franklin Electric expects the acquisition to increase adjusted EPS in 2027. After closing, it plans to include Challenge Pumps in its Water Systems segment and retain the brand. Ruzynski called the purchase “another important step in our strategy to build a broader, more resilient flow control company.”

The deal is expected to close in 2026, subject to Challenge Pumps’ annual audit and customary conditions.