Key Highlights

  • ACU posted record third-quarter net sales of $58.0 million, up 18% from $49.1 million and up 10% excluding My Medic.
  • Diluted EPS was $0.80 versus $0.46, and net income rose 80% to $3.4 million.
  • Gross margin was 45.3% versus 39.1%, including a lift of about 690 basis points from tariff refunds.
  • The DMT sharpening facility closure cost $1.8 million in cost of goods sold, about 310 basis points of margin.
  • Bank debt less cash was $29.7 million, against $23.1 million a year earlier.

Acme United Earnings: How Much of the Record $58M Quarter Came From Tariff Refunds?

Acme United (NYSEAMERICAN:ACU), a supplier of cutting, measuring and first aid products, reported record third-quarter 2026 net sales of $58.0 million on Tuesday, October 27, up 18% from $49.1 million. Excluding the My Medic acquisition, sales rose 10%. Net income climbed 80% to $3.4 million, and diluted EPS was $0.80 versus $0.46 (GAAP). The screen estimate was $0.66, a 21.21% surprise as screened.

A good part of the profit lift was one-time. The company received $6.0 million of refunds of tariffs imposed under the International Emergency Economic Powers Act, and recognized $4.0 million as a reduction of cost of goods sold in the quarter, with the other $2.0 million held as an accrued liability at September 30.

Where Did Growth Come From Across Regions and My Medic?

U.S. segment sales rose 20% in the quarter. Europe grew 5% in dollars (7% in local currency) and Canada 9% (12% in local currency).

My Medic, acquired on January 15, 2026, contributed minimal earnings in the quarter and the nine months. Management expects most of its profit in the fourth quarter, a pattern it expects to continue, with retail and distribution commitments beginning next year.

What Do the Margin Swings Say About Underlying Profitability?

Gross profit was $26.3 million against $19.2 million, a margin of 45.3% versus 39.1%. The tariff refund added about 690 basis points, while closing the DMT sharpening facility in Massachusetts cost $1.8 million in cost of goods sold, or about 310 basis points. Management said gross margin excluding both items still exceeded last year's level, mainly because of My Medic, but gave no figure.

SG&A rose to $21.8 million from $16.2 million, including $1.0 million of variable compensation tied to the refunds. Operating income was $4.5 million versus $3.0 million.

For nine months, gross margin was 42.6% versus 39.8%, and diluted EPS $2.29 versus $2.03.

Balance Sheet and Cash Flow: What Did the Acquisitions Cost?

Inventories were $69.0 million versus $60.2 million and receivables $36.2 million versus $30.0 million. Long-term debt was $28.1 million versus $18.3 million, and cash was $7.9 million versus $5.1 million. Bank debt less cash was $29.7 million against $23.1 million.

Over the trailing twelve months, the company paid about $14.5 million for My Medic, which carried an $18.6 million price less $4.1 million of holdbacks. Dividends paid were about $2.4 million, and free cash flow was about $13.8 million, including the $6.0 million of tariff refunds. The release mentioned no share repurchases.

Management described the balance sheet as strong and said it continues to seek acquisitions that fit its criteria.

What to Watch Next for Acme United?

The DMT closure later in 2026 is expected to save more than $1.0 million in 2027. Watch the fourth-quarter My Medic contribution, whether freight and raw material costs offset sourcing gains, and how margins look once tariff refunds drop out of the comparison.