Company Reports

Reliance Worldwide produces specialist plumbing and heating products. The firm’s strategy is to expand its share of the push-to-connect fittings category. As a first mover, its SharkBite product range has about 85% market share in the US within the push-to-connect category and is the only brand sold at the two largest home retailers, Lowe’s and Home Depot. Although patents have expired for the original SharkBite and John Guest push-to-connect products, Reliance continues to innovate and has recently introduced SharkBite Max. Marketed as stronger, we think the SharkBite Max can command a price premium over the original product and other push-to-connect brands.

Following due diligence, Brookfield Capital Partners and Reliance have entered into a scheme implementation deed for Brookfield to acquire 100% of Reliance for USD 3.38 cash per share. Reliance may solicit takeover proposals from other parties until Oct. 15. 2026.

Reliance Worldwide produces specialist plumbing and heating products. The firm’s strategy is to expand its share of the push-to-connect fittings category. As a first mover, its SharkBite product range has about 85% market share in the US within the push-to-connect category and is the only brand sold at the two largest home retailers, Lowe’s and Home Depot. Although patents have expired for the original SharkBite and John Guest push-to-connect products, Reliance continues to innovate and has recently introduced SharkBite Max. Marketed as stronger, we think the SharkBite Max can command a price premium over the original product and other push-to-connect brands.

Reliance has entered into a process deed with private equity firm Brookfield Capital Partners, following an unsolicited, nonbinding indicative proposal for 100% of Reliance's shares through a scheme of arrangement for AUD 4.75 per share. Shares jumped 25% following the announcement.

Reliance is to close its Australian brass casting, forging, and machining operations. The operations are surplus to requirements, with the new Sharkbite Max using 20% less brass, some now sourced from Asia, and the progression of a strategy to replace brass with stainless steel across key products.

About 40% has been shaved off Reliance's share price since early 2025. Initial market concerns were the impact of tariffs on sales. But prolonged cyclical weakness in the US residential sector, exacerbated by the Iran war, has added to the headwinds.

Reliance Worldwide produces specialist plumbing and heating products. The firm’s strategy is to expand its share of the push-to-connect fittings category. As a first mover, its SharkBite product range has about 85% market share in the US within the push-to-connect category and is the only brand sold at the two largest home retailers, Lowe’s and Home Depot. Although patents have expired for the original SharkBite and John Guest push-to-connect products, Reliance continues to innovate and has recently introduced SharkBite Max. Marketed as stronger, we think the SharkBite Max can command a price premium over the original product and other push-to-connect brands.

Reliance's interim fiscal 2026 adjusted EBITDA fell 23% on last year to USD 111 million, as US tariffs and weak demand in key regions weighed. Second-half operating earnings are expected to improve as sourcing continues to shift away from China, and price rises flow through. Shares fell 9%.

At its annual general meeting, Reliance guidance was for unchanged first-half fiscal 2026, expecting flat or slightly lower sales than the prior year. Operating earnings and margins are expected to be lower than in the first half of fiscal 2025 due to lower sales volumes and the impact of tariffs.

Reliance Worldwide produces specialist plumbing and heating products. The firm’s strategy is to expand its share of the push-to-connect fittings category. As a first mover, its SharkBite product range has about 85% market share in the US within the push-to-connect category and is the only brand sold at the two largest home retailers, Lowe’s and Home Depot. Although patents have expired for the original SharkBite and John Guest push-to-connect products, Reliance continues to innovate and has recently introduced SharkBite Max. Marketed as stronger, we think the SharkBite Max can command a price premium over the original product and other push-to-connect brands.

Reliance's fiscal 2025 revenue rose 6% to USD 1,315 million, driven by the full-year contribution of Holman. Excluding the acquisition, revenue was almost flat on the prior year. The biggest laggards were the US and UK segments, with sales down 2% and 4%, respectively. Shares fell 7% on the day.

Reliance updated its fiscal 2025 trading outlook, with Americas sales expected at the low end of management's broadly unchanged guidance, amid weakening US demand. Reliance is shifting all sourcing away from China to reduce tariff cost pressures, to be completed by fiscal 2028.

Reliance Worldwide produces specialist plumbing and heating products. The firm’s strategy is to expand its share of the push-to-connect fittings category. As a first mover, its SharkBite product range has about 85% market share in the US within the push-to-connect category and is the only brand sold at the two largest home retailers, Lowe’s and Home Depot. Although patents have expired for the original SharkBite and John Guest push-to-connect products, Reliance continues to innovate and has recently introduced SharkBite Max. Marketed as stronger, we think the SharkBite Max can command a price premium over the original product and other push-to-connect brands.

US President Trump temporarily lowered tariffs to 10% on most ex-China US imports for a three-month period while countries seek to negotiate. But China is facing an even higher 145% tariff. Most ANZ industrial shares rallied, returning to, or nearing, pre-"liberation day" prices.

Reliance Worldwide produces specialist plumbing and heating products. The firm’s strategy is to expand its share of the push-to-connect fittings category. As a first mover, its SharkBite product range has about 85% market share in the US within the push-to-connect category and is the only brand sold at the two largest home retailers, Lowe’s and Home Depot. Although patents have expired for the original SharkBite and John Guest push-to-connect products, Reliance continues to innovate and has recently introduced SharkBite Max. Marketed as stronger, we think the SharkBite Max can command a price premium over the original product and other push-to-connect brands.

Narrow-moat Reliance’s first-half fiscal 2025 earnings result was as expected. Adjusted EBITDA increased by 15% from the same period last year to USD 144 million. Revenue of USD 677 million is up 15%, or 4% excluding acquisitions. We expect a slightly weaker second half, with some product orders pulled forward into the first half ahead of an inventory system change, and no significant change to demand expected from the residential sector, which accounts for most of Reliance’s sales.

Reliance Worldwide produces specialist plumbing and heating products. The firm’s strategy is to expand its share of the push-to-connect fittings category. As a first mover, its SharkBite product range has about 85% market share in the US within the push-to-connect category and is the only brand sold at the two largest home retailers, Lowe’s and Home Depot. Although patents have expired for the original SharkBite and John Guest push-to-connect products, Reliance continues to innovate and has recently introduced SharkBite Max. Marketed as stronger, we think the SharkBite Max can command a price premium over the original product and other push-to-connect brands.

Narrow-moat Reliance is well-positioned to benefit from improved housing sentiment in North America, where 70% of its earnings are exposed. Improving sentiment largely owes to expectations of lower mortgage rates. In October 2024, approximately 40% of respondents stated they expect mortgage rates to decline, per the Fannie May Home Purchase Sentiment Index. We forecast the average US home loan 30-year fixed rate will decline to 5.90% in 2025 and 4.75% by 2027, down from an average of 6.80% over the last two years. This underpins our expectation of increased construction and repair and renovation activity, and demand for Reliance’s plumbing and heating products. Both segments have seen weaker volumes over fiscal 2024 and the first half of fiscal 2025.

Reliance Worldwide produces specialist plumbing and heating products. The firm’s strategy is to expand its share of the push-to-connect fittings category. As a first mover, its SharkBite product range has about 85% market share in the US within the push-to-connect category and is the only brand sold at the two largest home retailers, Lowe’s and Home Depot. Although patents have expired for the original SharkBite and John Guest push-to-connect products, Reliance continues to innovate and has recently introduced SharkBite Max. Marketed as stronger, we think the SharkBite Max can command a price premium over the original product and other push-to-connect brands.

Reliance Worldwide’s fiscal 2024 sales revenue of USD 1.2 billion was flat on the previous corresponding period. Weaker volumes in all regions were offset by mix shift to higher-priced new products and contributions from the Holman acquisition. Adjusted fiscal 2024 EBIT of USD 215 million was 3% lower than the PCP due to lower margins in the Asia-Pacific and Europe, Middle East, and Africa. The standout performer was the Americas segment. Higher margins from product mix shift and cost savings underpinned a 17% rise in adjusted EBIT for the Americas.