LII LENNOX INTERNATIONAL INC

Overview and Growth

In fiscal 2025, LENNOX INTERNATIONAL INC recorded $5.20B of revenue, net income of $805.80M, and an operating cash inflow of $757.60M. Revenue of $5.20B sets the scale for evaluating how effectively sales translated into profit and cash during the year. Revenue was 2.7% below fiscal 2024 revenue of $5.34B, marking a top-line contraction. Diluted earnings per share were $22.79, translating the period’s attributable earnings into the amount reported for each diluted share. Against diluted EPS of $22.66 in fiscal 2024, the current result was 0.6% higher. Revenue equaled 1.27x of total assets, indicating how much reported top-line activity the company produced relative to its period-end asset base.

Profitability

After reported cost of revenue, the company retained $1.73B as gross profit before recognizing operating expenses and other items. Gross margin was 33.4%, so that share of each revenue unit remained after the cost of revenue reported for the period. Operations produced $1.04B of income after the reported operating expense base, before the remaining non-operating and tax effects. Operating margin measured 20.0%, showing the portion of revenue preserved after the full set of operating costs. Net income came to $805.80M, completing the progression from revenue through gross and operating profitability to the final reported result. Net margin was 15.5%, meaning that this portion of revenue remained as net income after all recognized expenses. Pretax income was $996.80M, isolating the reported earnings outcome before the income-tax provision recognized for the fiscal year. Measured against revenue, pretax income equaled 19.2%, adding a pre-tax profitability layer between revenue and net income. The company recognized $191.00M of income tax for the period, completing the transition from pretax income to net income. The effective relationship between income tax and positive pretax income was 19.2%, without assuming a statutory-rate comparison. Net income equaled 69.3% of period-end equity, showing the earnings generated on shareholders’ book capital. The net-income-to-assets relationship measured 19.7%, showing earnings relative to the full balance sheet.

Liquidity and Capital Structure

The company held $4.08B of assets against $2.92B of liabilities and $1.16B of equity, revealing how the asset base was financed. The near-term balance sheet paired $1.90B of current assets with $1.19B of current liabilities at the reporting date. The current ratio was 1.6x, with current assets exceeding current liabilities and providing a short-term liquidity cushion. Cash and equivalents totaled $34.20M, identifying the most liquid reported component available within the broader current-asset balance. The cash balance equaled 2.9% of current liabilities, showing how much near-term coverage came from cash alone. The liabilities-to-assets relationship was 71.5%, placing reported obligations against the full positive asset balance. Cash and equivalents equaled 0.8% of total assets, showing the liquid cash component within the company’s broader resource base. Total assets were 12.8% higher than fiscal 2024 assets of $3.62B, measuring the company’s own balance-sheet change.

Cash Flow and Earnings Quality

The company reported $757.60M of operating cash flow, a cash inflow that shows the cash generated by operations. Operating cash flow equaled 0.94x of net income, showing how strongly accounting earnings converted into cash from operations. Capital spending was $118.80M, absorbing part of the cash generated from operations before free cash flow. Capital expenditures represented 15.7% of operating cash flow, leaving the remainder available as free cash flow. After capital spending, free cash flow was $638.80M, leaving cash available for debt reduction, shareholder returns, or further investment. The free-cash-flow margin was 12.3%, measuring cash remaining after capital spending against revenue. Measured against total assets, free cash flow represented 15.6%, showing the cash productivity of the company’s assets.

Based on the annual report for the fiscal year ending Dec 31, 2025. Analysis generated Oct 21, 2026.