Core Insights - Theravance Biopharma presented analyses of its Phase 3 program for ampreloxetine, targeting symptomatic neurogenic orthostatic hypotension (nOH) at the International MSA Congress in Boston [1][2] Company Overview - Theravance Biopharma focuses on developing innovative therapies, including ampreloxetine, a selective norepinephrine reuptake inhibitor for treating nOH in patients with multiple system atrophy (MSA) [6][13] - The company has received Orphan Drug Designation for ampreloxetine in the U.S. and plans to file a New Drug Application (NDA) if ongoing studies yield positive results [6] Clinical Study Findings - A subgroup analysis from the REDWOOD 0170 study indicated that MSA patients had the highest nOH symptom burden, emphasizing the need for improved therapies [2] - Results from the studies support the ongoing registrational study (CYPRESS) evaluating ampreloxetine's efficacy in MSA patients [3] - Patients with MSA showed clinically meaningful improvement in nOH symptoms after 16 weeks of treatment with ampreloxetine, with stable symptoms in the treatment group compared to worsening in the placebo group [7][10] Study Details - The CYPRESS study is a Phase 3, multi-center, randomized withdrawal trial assessing ampreloxetine's efficacy after 20 weeks of treatment, with primary endpoints focused on changes in the Orthostatic Hypotension Symptom Assessment (OHSA) composite score [9] - The REDWOOD 0170 study included a 16-week open-label period followed by a 6-week double-blind, placebo-controlled withdrawal period, with a primary endpoint of treatment failure defined by specific worsening scores [10] Patient Impact - MSA patients experience severe symptoms affecting their quality of life due to nOH, with 70-90% of MSA patients experiencing these symptoms [11] - The clinical profile of ampreloxetine demonstrated target engagement and sustained blood pressure effects, indicating its potential as a first-in-class therapy for MSA-related nOH [6][7]

Core Viewpoint - MSA Safety Incorporated has acquired M&C TechGroup for approximately $200 million, enhancing its capabilities in gas analysis and detection solutions [1][7]. Company Overview - MSA Safety is a global leader in advanced safety products and solutions, with 2024 revenues of $1.8 billion and over 5,000 employees across more than 40 international locations [5]. - M&C TechGroup, founded in 1985 and based in Ratingen, Germany, employs around 220 associates and specializes in gas analysis systems for critical industrial processes [2][6]. Strategic Implications - The acquisition aligns with MSA's Accelerate strategy, focusing on expanding its detection business and enhancing its portfolio through strategic acquisitions [3]. - MSA expects to leverage its global footprint and distribution network to accelerate M&C's growth, positioning itself as a leading provider of gas analysis solutions [4]. Market Position - M&C TechGroup has an annual revenue of approximately $55 million, which complements MSA's existing technology and customer base [7]. - The acquisition is anticipated to be accretive to MSA's adjusted earnings in 2025, indicating a positive financial impact [7].

Financial Performance - Net sales for Q1 2025 were $421,340,000, a 1.3% increase from $413,302,000 in Q1 2024[7] - Gross profit for Q1 2025 was $193,395,000, down 0.6% from $195,531,000 in Q1 2024[7] - Operating income decreased to $77,761,000 in Q1 2025 from $80,112,000 in Q1 2024, reflecting a decline of 2.9%[7] - Net income for Q1 2025 was $59,605,000, compared to $58,139,000 in Q1 2024, representing a 2.5% increase[7] - Earnings per share attributable to common shareholders increased to $1.51 in Q1 2025 from $1.48 in Q1 2024[7] - Comprehensive income for Q1 2025 was $82,343,000, significantly higher than $47,840,000 in Q1 2024, indicating a substantial increase[11] - Adjusted operating income for Q1 2025 was $87,502 thousand, slightly down from $88,009 thousand in Q1 2024, reflecting a decrease of 0.6%[53] - Basic earnings per share for Q1 2025 were $1.51, an increase from $1.48 in Q1 2024[55] - The Fire Service product group generated $150,616 thousand in sales, accounting for 36% of total consolidated sales in Q1 2025[53] - The Americas segment generated net sales of $293.16 million, while the International segment contributed $128.18 million for Q1 2025[52] Assets and Liabilities - Total assets as of March 31, 2025, were $2,235,885,000, up from $2,205,784,000 at the end of 2024[13] - Total liabilities decreased to $1,045,740,000 as of March 31, 2025, from $1,062,465,000 at the end of 2024[13] - Total assets as of March 31, 2025, amounted to $2,235,885 thousand, compared to $2,174,330 thousand at the end of Q1 2024, indicating a growth of 2.8%[52] - The company’s total liabilities decreased to $1.05 billion as of March 31, 2025, from $1.06 billion at the end of 2024, a reduction of 1.2%[14] - As of March 31, 2025, the company's total long-term debt was $502.1 million, a decrease from $508.0 million as of December 31, 2024[66] Cash Flow and Dividends - Cash flow from operating activities for Q1 2025 was $61,833,000, compared to $50,886,000 in Q1 2024, showing a 21.5% increase[16] - The company paid dividends of $0.51 per common share in Q1 2025, up from $0.47 per share in Q1 2024[7] - Common dividends declared were $20,023,000 for the quarter ended March 31, 2025, compared to $18,480,000 for the same period in 2024, representing an increase of 8.4%[19] Inventory and Capital Expenditures - Total inventories increased to $306.675 million as of March 31, 2025, up from $296.796 million at December 31, 2024, reflecting a growth in finished products and raw materials[41] - Capital expenditures for Q1 2025 totaled $10,784 thousand, compared to $11,219 thousand in Q1 2024, representing a decrease of 3.9%[52] Restructuring and Charges - The company recorded restructuring charges of $1.9 million for the three months ended March 31, 2025, compared to $3.0 million for the same period in 2024, indicating a reduction in restructuring efforts[38][39] - The company’s total restructuring reserves decreased to $4.4 million as of March 31, 2025, from $9.8 million at December 31, 2023[40] Tax and Compliance - The effective tax rate for Q1 2025 was 23.5%, up from 23.1% in Q1 2024, primarily due to state income taxes[56] - As of March 31, 2025, the Company was in full compliance with the restrictive covenants under its various credit agreements[74] Foreign Currency and Derivatives - The notional amount of open foreign currency forward contracts was $150.7 million as of March 31, 2025, down from $184.0 million at December 31, 2024[79] - The company reported currency exchange losses of $2.6 million for the three months ended March 31, 2025, compared to gains of $1.8 million in the same period of 2024[81] Product Liability and Legal Matters - The company faces ongoing product liability claims related to PFAS substances, with 731 lawsuits involving 9,274 claims as of April 22, 2025[90] - The company established reserves for single incident product liability claims based on historical experience and expected settlement costs[85] - The company expects to continue pursuing insurance coverage and indemnification related to ongoing litigation[90]

Financial Data and Key Metrics Changes - First quarter sales were $421 million, an increase of 2% on a reported basis and 4% organically compared to the prior year [15][16] - Gross margin in the first quarter was 45.9%, down 140 basis points year over year, impacted by foreign exchange headwinds and inflation [16] - GAAP net income totaled $60 million or $1.51 per share, with adjusted diluted earnings per share at $1.68, up 4% from last year [17] Business Line Data and Key Metrics Changes - Sales in the Fire Service category were down high single digits year over year, primarily due to challenging comparisons in the Americas segment [7] - Detection sales experienced mid-teens growth, supported by expansion in fixed and portable gas detection categories [9] - Industrial PPE sales were up 3% organically, with growth in head and fall protection offset by contraction in other PPE [9][18] Market Data and Key Metrics Changes - The Americas segment saw a 1% decrease in sales year over year on a reported basis, but a 1% increase on an organic basis [18] - The International segment reported a 9% increase in sales year over year on a reported basis or 11% organically, with double-digit organic growth in Detection [18][19] - Currency translation posed a 2% headwind to overall growth, primarily affecting the Brazilian real, Mexican peso, and euro [15][16] Company Strategy and Development Direction - The company remains focused on advancing its Accelerate strategy and delivering long-term profitable growth aligned with its 2028 financial targets [10][21] - MSA Safety is committed to innovation in product categories, particularly in detection and fire service, to maintain market leadership [10][11] - The company is evaluating its supply chain and pricing strategies in response to evolving tariff situations, with about 15% of its cost of sales now subject to tariffs [13][14] Management's Comments on Operating Environment and Future Outlook - Management noted that while macroeconomic conditions have become more uncertain, the business remains healthy with stable order trends [21][22] - The company anticipates continued FX pressure on gross margins, particularly from Latin American currencies, into the second quarter [16] - Despite challenges, management expressed confidence in achieving long-term growth targets and maintaining a strong commercial pipeline [72] Other Important Information - Free cash flow for the quarter was $51 million, representing a conversion rate of 86% [19] - The company returned value to shareholders through $20 million in dividends and $10 million in share repurchases [20] - MSA Safety amended and increased its revolving credit facility to $1.3 billion, ensuring ample liquidity for future growth initiatives [14][20] Q&A Session Summary Question: Changes in project decision-making due to tariffs - Management indicated that there was strong project work in the first quarter, particularly in energy and petrochemical sectors, with some customers accelerating shipments [28][29] Question: Local currency gross margin impact - Management confirmed that the biggest impact on gross margins was from foreign exchange, primarily from Latin American currencies, and this pressure is expected to continue [32][34] Question: Fixed versus portable growth in detection - Management reported double-digit incoming orders for both fixed and portable detection, with strong performance across the energy segments globally [41][42] Question: Impact of backlog and tariffs on second quarter - Management noted a $40 million backlog headwind in the second quarter and indicated that tariff impacts would be more pronounced in the second half of the year [45][47] Question: Long-term margin gains from cost reduction actions - Management stated that cost reduction actions are viewed as long-term strategic initiatives, and they expect to retain gains even if tariffs are resolved favorably [68][70] Question: Ability to reach 2028 targets amid current environment - Management expressed confidence in achieving 2028 targets, citing strong macro trends and a diverse portfolio, despite potential short-term challenges [72]

Financial Data and Key Metrics Changes - First quarter sales were $421 million, an increase of 2% on a reported basis and 4% organically compared to the prior year [16] - Gross margin in the first quarter was 45.9%, down 140 basis points year over year, impacted by transactional foreign exchange headwinds and inflation [17] - GAAP net income totaled $60 million or $1.51 per share, with adjusted diluted earnings per share at $1.68, up 4% from last year [18] Business Line Data and Key Metrics Changes - Sales in the Fire Service category were down high single digits year over year, primarily due to challenging comparisons in the Americas segment [7] - Detection sales grew mid-teens, supported by expansion in fixed and portable gas detection categories [9] - Industrial PPE sales increased by 3% organically, with growth in head and fall protection offset by contraction in other PPE [9] Market Data and Key Metrics Changes - The Americas segment saw a 1% decrease in sales year over year on a reported basis, but a 1% increase on an organic basis [19] - The International segment experienced a 9% increase in sales year over year on a reported basis or 11% organically [20] - Currency translation posed a 2% headwind in the quarter, primarily affecting the Brazilian real, Mexican peso, and euro [16] Company Strategy and Development Direction - The company remains focused on advancing its Accelerate strategy and delivering long-term profitable growth aligned with its 2028 financial targets [11] - MSA Safety is committed to innovation in product categories, particularly in detection and fire service, to maintain market leadership [12] - The company is evaluating its supply chain and pricing strategies in response to evolving tariff situations [14][58] Management's Comments on Operating Environment and Future Outlook - Management noted that while macroeconomic conditions have become more uncertain, demand remains resilient across product categories [6][22] - The company expects continued pressure on gross margins due to foreign exchange rates, particularly in Latin America [17] - Despite challenges, management is optimistic about achieving its 2028 targets, citing strong underlying market trends and a diverse product portfolio [68] Other Important Information - Free cash flow for the quarter was $51 million, representing a conversion rate of 86% [20] - The company returned value to shareholders through $20 million in dividends and $10 million in share repurchases [21] - MSA Safety amended and increased its revolving credit facility to $1.3 billion, ensuring ample liquidity for future growth initiatives [21] Q&A Session Summary Question: How has project decision-making changed during the quarter due to tariffs? - Management indicated that there was strong project work in the first quarter, particularly in energy and petrochemical sectors, with some customers accelerating shipments [28][29] Question: Can you provide details on local currency gross margin and the impact of transactional headwinds? - The biggest impact on gross margins was from foreign exchange, primarily on Latin American currencies, which is expected to continue into the second quarter [32][34] Question: What is the growth outlook for the detection business, particularly fixed versus portable? - Both fixed and portable detection categories saw strong incoming orders, with double-digit growth overall, and management expects continued strength in 2025 [40][43] Question: How will the pull forward of orders in Q1 impact Q2 and the rest of the year? - The pull forward in Q1 was just under $10 million, primarily in the Americas, and management anticipates challenges in Q2 due to tough comparisons [48][56] Question: What are the mitigation efforts regarding potential tariff impacts on the supply chain? - Management is focusing on pricing and cost management strategies to mitigate tariff impacts, with a targeted price increase implemented in April [58][60] Question: Will cost reduction actions lead to long-term margin gains if tariffs are resolved? - Management indicated that cost reduction initiatives are viewed as long-term strategic actions, and they expect to retain some of the gains regardless of tariff changes [64][66] Question: Does the current environment affect the ability to reach 2028 targets? - Management remains committed to the 2028 targets, citing strong macro trends and a diverse portfolio, despite potential challenges from tariffs [68][70]

Financial Performance - Net sales reached $421 million, a 2% increase compared to the previous year[8,9] - Adjusted operating income was $88 million, a 1% decrease year-over-year[8] - Adjusted operating margin was 208%, a decrease of 50 basis points[8] - Adjusted EPS increased by 4% year-over-year to $168[8,9] - Free cash flow reached $51 million, representing an 86% conversion rate[8] Sales Analysis - Organic sales growth was 4%, with a 2% headwind from currency translation[9,23] - Americas reported a 1% organic sales increase, while international saw an 11% increase[23] - Detection segment experienced mid-teens organic growth, while fire service contracted by a high-single-digit percentage[23] Strategic Actions and Outlook - The company increased its Revolving Credit Facility to $13 billion to support future growth initiatives[13,29] - The company is maintaining a low-single-digit organic sales growth outlook for 2025, but acknowledges increased risk due to macroeconomic and policy uncertainty[30] - The company anticipates a flat to 1% revenue headwind from foreign exchange[31]

Company Performance - MSA Safety reported quarterly earnings of $1.68 per share, exceeding the Zacks Consensus Estimate of $1.59 per share, and showing an increase from $1.61 per share a year ago, representing an earnings surprise of 5.66% [1] - The company achieved revenues of $421.34 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 4.97% and up from $413.3 million year-over-year [2] - Over the last four quarters, MSA Safety has consistently surpassed consensus EPS estimates four times and topped revenue estimates two times [2] Future Outlook - The sustainability of MSA Safety's stock price movement will largely depend on management's commentary during the earnings call and the company's earnings outlook [3][4] - Current consensus EPS estimate for the upcoming quarter is $1.97 on revenues of $454.72 million, and for the current fiscal year, it is $8.06 on revenues of $1.82 billion [7] Industry Context - The Security and Safety Services industry, to which MSA Safety belongs, is currently ranked in the bottom 42% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact MSA Safety's performance [5][6]

[First Quarter 2025 Results Overview](index=1&type=section&id=1.%20First%20Quarter%202025%20Results%20Overview) MSA Safety delivered solid Q1 results, driven by strategic execution, robust detection performance, and accelerated shipments due to tariffs [CEO Commentary and Strategic Execution](index=1&type=section&id=1.1.%20CEO%20Commentary%20and%20Strategic%20Execution) CEO Steve Blanco highlighted solid Q1 results driven by the 'Accelerate strategy,' robust performance in detection, and accelerated shipments due to tariffs, noting healthy order growth and stable market conditions - Solid first quarter results demonstrate the team's continued dedication to executing the **'Accelerate strategy'**[4](index=4&type=chunk) - Revenue growth was fueled by robust performance in detection and accelerated shipments in consideration of tariffs[4](index=4&type=chunk) - Healthy order growth across product categories indicates stable market conditions to start the year[4](index=4&type=chunk) [Key Financial Highlights](index=1&type=section&id=1.2.%20Key%20Financial%20Highlights) MSA Safety reported Q1 2025 net sales of **$421 million** (4% organic increase), GAAP operating income of **$78 million** (18.5% of sales), and GAAP net income of **$60 million** (**$1.51** diluted EPS), returning **$20 million** in dividends and **$10 million** in share repurchases - Achieved quarterly net sales of **$421 million**, a **2% GAAP increase** and **4% organic increase** year-over-year[5](index=5&type=chunk) - Generated GAAP operating income of **$78 million**, or **18.5% of sales**, and adjusted operating income of **$88 million**, or **20.8% of sales**[5](index=5&type=chunk) - Recorded GAAP net income of **$60 million**, or **$1.51 per diluted share**, and adjusted earnings of **$66 million**, or **$1.68 per diluted share**[5](index=5&type=chunk) - Returned capital to shareholders through **$20 million** of dividends and **$10 million** of share repurchases[5](index=5&type=chunk) [Detailed Financial Performance (Q1 2025)](index=2&type=section&id=2.%20Detailed%20Financial%20Performance%20(Q1%202025)) This section provides a comprehensive overview of MSA Safety's consolidated and segment-specific financial results for the first quarter of 2025 [Consolidated Financial Summary](index=2&type=section&id=2.1.%20Consolidated%20Financial%20Summary) Consolidated net sales increased **2% GAAP** and **4% organically** year-over-year to **$421.3 million**, while GAAP operating income decreased **3%** to **$77.8 million**, and free cash flow significantly improved by **29%** to **$51.0 million** | Metric | Q1 2025 (Millions) | Q1 2024 (Millions) | % Change | | :---------------------- | :----------------- | :----------------- | :------- | | Net Sales (GAAP) | $421.3 | $413.3 | 2% | | Operating Income (GAAP) | $77.8 | $80.1 | (3)% | | % of Net Sales (GAAP) | 18.5% | 19.4% | (90) bps | | Net Income (GAAP) | $59.6 | $58.1 | 3% | | Diluted EPS (GAAP) | $1.51 | $1.47 | 3% | | Adjusted EBITDA | $101.5 | $101.3 | —% | | % of Net Sales (Adj. EBITDA) | 24.1% | 24.5% | (40) bps | | Adjusted Operating Income | $87.5 | $88.0 | (1)% | | % of Net Sales (Adj. Op. Inc.) | 20.8% | 21.3% | (50) bps | | Adjusted Earnings | $66.4 | $63.5 | 5% | | Adjusted Diluted EPS | $1.68 | $1.61 | 4% | | Free Cash Flow | $51.0 | $39.7 | 29% | | Free Cash Flow Conversion | 86% | 68% | | [Segment Performance](index=2&type=section&id=2.2.%20Segment%20Performance) The Americas segment experienced a **1% GAAP net sales decrease** and a **9% decline** in operating income, while the International segment showed strong growth with net sales increasing **9%** and GAAP operating income surging **56%**, significantly expanding margins | Metric | Q1 2025 (Millions) | Q1 2024 (Millions) | % Change | | :---------------------- | :----------------- | :----------------- | :------- | | **Americas Segment** | | | | | Net Sales | $293.2 | $295.5 | (1)% | | GAAP Operating Income | $76.5 | $84.2 | (9)% | | % of Net Sales (GAAP) | 26.1% | 28.5% | (240) bps | | Adjusted Operating Income | $78.7 | $86.2 | (9)% | | % of Net Sales (Adj.) | 26.8% | 29.2% | (240) bps | | **International Segment** | | | | | Net Sales | $128.2 | $117.8 | 9% | | GAAP Operating Income | $17.3 | $11.1 | 56% | | % of Net Sales (GAAP) | 13.5% | 9.4% | 410 bps | | Adjusted Operating Income | $18.7 | $13.5 | 39% | | % of Net Sales (Adj.) | 14.6% | 11.5% | 310 bps | [2025 Net Sales Outlook](index=3&type=section&id=3.%202025%20Net%20Sales%20Outlook) MSA Safety maintained its full-year organic sales growth outlook for 2025 at a low-single-digit percentage, acknowledging increased macroeconomic risks [2025 Net Sales Outlook](index=3&type=section&id=3.1.%202025%20Net%20Sales%20Outlook) MSA Safety maintained its full-year organic sales growth outlook for 2025 at a low-single-digit percentage, while acknowledging increased macroeconomic risks, including tariffs - The company maintained its **low-single-digit full-year organic sales growth outlook** for 2025[8](index=8&type=chunk) - Acknowledged increased risk due to macroeconomic factors, including tariffs[8](index=8&type=chunk) [Conference Call Information](index=3&type=section&id=4.%20Conference%20Call%20Information) Details for MSA Safety's Q1 2025 earnings conference call, including webcast and dial-in information, are provided [Conference Call Details](index=3&type=section&id=4.1.%20Conference%20Call%20Details) MSA Safety will host a conference call on April 30, 2025, at 10:00 a.m. Eastern time to discuss Q1 2025 results and outlook, with webcast and dial-in details available - MSA Safety will host a conference call on **Wednesday, April 30, 2025, at 10:00 a.m. Eastern time** to discuss its first quarter 2025 results and outlook[9](index=9&type=chunk) - The call and an accompanying slide presentation will be webcast at http://investors.msasafety.com/ under the 'News and Events' tab, subheading 'Events & Presentations'[9](index=9&type=chunk) - Investors and interested parties can also dial into the call at **1-844-854-4415** (toll-free) or **1-412-902-6599** (international)[9](index=9&type=chunk) [Condensed Consolidated Financial Statements](index=4&type=section&id=5.%20Condensed%20Consolidated%20Financial%20Statements) This section presents MSA Safety's condensed consolidated statements of income, balance sheets, and cash flows for Q1 2025 and comparative periods [Statements of Income](index=4&type=section&id=5.1.%20Statements%20of%20Income) For Q1 2025, net sales were **$421.3 million**, with a gross profit of **$193.4 million**, operating income of **$77.8 million**, and net income of **$59.6 million**, or **$1.51 per diluted share** | Metric (in thousands) | Q1 2025 | Q1 2024 | | :-------------------- | :------ | :------ | | Net sales | $421,340 | $413,302 | | Cost of products sold | $227,945 | $217,771 | | Gross profit | $193,395 | $195,531 | | Operating income | $77,761 | $80,112 | | Net income | $59,605 | $58,139 | | Diluted EPS | $1.51 | $1.47 | [Balance Sheets](index=5&type=section&id=5.2.%20Balance%20Sheets) As of March 31, 2025, total assets were **$2.236 billion**, a slight increase from **$2.206 billion** at December 31, 2024, with total shareholders' equity growing to **$1.190 billion** | Metric (in thousands) | March 31, 2025 | December 31, 2024 | | :-------------------- | :------------- | :---------------- | | Total current assets | $823,162 | $803,030 | | Total assets | $2,235,885 | $2,205,784 | | Total current liabilities | $280,440 | $288,093 | | Long-term debt, net | $469,171 | $481,622 | | Total shareholders' equity | $1,190,145 | $1,143,319 | [Statements of Cash Flows](index=6&type=section&id=5.3.%20Statements%20of%20Cash%20Flows) Net cash flow from operating activities for Q1 2025 was **$61.8 million**, an increase from **$50.9 million** in Q1 2024, while cash flow used in financing activities was **$45.6 million** | Metric (in thousands) | Q1 2025 | Q1 2024 | | :-------------------- | :------ | :------ | | Net income | $59,605 | $58,139 | | Cash flow from operating activities | $61,833 | $50,886 | | Cash flow used in investing activities | $(10,766) | $(11,219) | | Cash flow used in financing activities | $(45,612) | $(29,085) | | Increase in cash, cash equivalents and restricted cash | $6,198 | $1,906 | [Sales by Product Group](index=7&type=section&id=6.%20Sales%20by%20Product%20Group) This section analyzes MSA Safety's Q1 2025 sales performance across different product groups, highlighting Detection as the largest segment [Sales by Product Group Analysis](index=7&type=section&id=6.1.%20Sales%20by%20Product%20Group%20Analysis) In Q1 2025, Detection products became the largest segment, contributing **38%** of consolidated sales (**$161.1 million**), up from **34%** in Q1 2024, while Fire Service sales decreased to **36%** | Product Group | Q1 2025 Sales (Thousands) | Q1 2025 % of Total | Q1 2024 Sales (Thousands) | Q1 2024 % of Total | | :-------------------- | :------------------------ | :----------------- | :------------------------ | :----------------- | | Fire Service | $150,616 | 36% | $163,694 | 40% | | Detection | $161,070 | 38% | $139,216 | 34% | | Industrial PPE and Other | $109,654 | 26% | $110,392 | 26% | | **Total** | **$421,340** | **100%** | **$413,302** | **100%** | - International segment's Detection sales grew from **$42.9 million** (**36% of segment**) in Q1 2024 to **$51.2 million** (**40% of segment**) in Q1 2025[15](index=15&type=chunk) [Reconciliation of Non-GAAP Financial Measures](index=8&type=section&id=7.%20Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section provides reconciliations for MSA Safety's non-GAAP financial measures, including organic sales change, adjusted operating income, adjusted EBITDA, adjusted earnings, and debt ratios [Organic Sales Change](index=8&type=section&id=7.1.%20Organic%20Sales%20Change) Consolidated organic sales increased by **4%** year-over-year in Q1 2025, with Detection showing the strongest organic growth at **17%** consolidated, and the International segment achieving **11%** organic sales growth | Product Group | GAAP Reported Sales Change | Plus: Currency Translation Effects | Organic Sales Change | | :-------------------- | :------------------------- | :------------------------------- | :------------------- | | Fire Service | (8)% | 1% | (7)% | | Detection | 16% | 1% | 17% | | Industrial PPE and Other | (1)% | 4% | 3% | | **Net Sales** | **2%** | **2%** | **4%** | | Product Group | GAAP Reported Sales Change | Plus: Currency Translation Effects | Organic Sales Change | | :-------------------- | :------------------------- | :------------------------------- | :------------------- | | **International Segment** | | | | | Fire Service | 8% | 2% | 10% | | Detection | 19% | 2% | 21% | | Industrial PPE and Other | (3)% | 2% | (1)% | | **Net Sales** | **9%** | **2%** | **11%** | [Adjusted Operating Income and Adjusted EBITDA](index=9&type=section&id=7.2.%20Adjusted%20Operating%20Income%20and%20Adjusted%20EBITDA) Adjusted EBITDA for Q1 2025 was **$101.5 million**, flat compared to Q1 2024, while adjusted operating income was **$87.5 million**, a **1% decrease**, excluding specific non-recurring charges | Metric (in thousands) | Q1 2025 | Q1 2024 | | :-------------------- | :------ | :------ | | Adjusted EBITDA | $101,467 | $101,254 | | Adjusted operating income | $87,502 | $88,009 | - Adjustments for Q1 2025 included **$1.9 million** in restructuring charges, **$4.1 million** in currency exchange losses, **$2.3 million** in amortization of acquisition-related intangible assets, and **$1.5 million** in transaction costs[20](index=20&type=chunk) [Adjusted Earnings and Adjusted Diluted EPS](index=10&type=section&id=7.3.%20Adjusted%20Earnings%20and%20Adjusted%20Diluted%20EPS) Adjusted earnings increased **5%** to **$66.4 million** in Q1 2025, and adjusted diluted EPS rose **4%** to **$1.68**, after removing specific non-GAAP adjustments and their tax effects | Metric (in thousands, except per share) | Q1 2025 | Q1 2024 | % Change | | :-------------------------------------- | :------ | :------ | :------- | | Net income | $59,605 | $58,139 | 3% | | Adjusted earnings | $66,438 | $63,497 | 5% | | Adjusted diluted earnings per share | $1.68 | $1.61 | 4% | - Key adjustments for Q1 2025 included adding back **$1.9 million** for restructuring, **$4.1 million** for currency exchange losses, **$2.3 million** for acquisition-related intangible amortization, and **$1.5 million** for transaction costs[21](index=21&type=chunk) [Debt to Adjusted EBITDA / Net Debt to Adjusted EBITDA](index=11&type=section&id=7.4.%20Debt%20to%20Adjusted%20EBITDA%20%2F%20Net%20Debt%20to%20Adjusted%20EBITDA) As of March 31, 2025, MSA Safety reported a Debt to Adjusted EBITDA ratio of **1.1** and a Net Debt to Adjusted EBITDA ratio of **0.7**, based on a trailing twelve-month adjusted EBITDA of **$469.6 million** - Debt to adjusted EBITDA was **1.1** as of March 31, 2025[23](index=23&type=chunk) - Net debt to adjusted EBITDA was **0.7** as of March 31, 2025[23](index=23&type=chunk) - Adjusted EBITDA for the twelve months ended March 31, 2025, was **$469.6 million**[23](index=23&type=chunk) [Additional Information](index=12&type=section&id=8.%20Additional%20Information) This section provides background on MSA Safety, cautionary statements regarding forward-looking information, and disclosures on non-GAAP financial measures [About MSA Safety](index=12&type=section&id=8.1.%20About%20MSA%20Safety) MSA Safety Incorporated, founded in 1914, is a global leader in advanced safety products, technologies, and solutions, generating **$1.8 billion** in 2024 revenue with over **5,000** associates worldwide - MSA Safety Incorporated is the global leader in advanced safety products, technologies and solutions[24](index=24&type=chunk) - The Company has been at the forefront of safety innovation since **1914**[24](index=24&type=chunk) - With **2024 revenues of $1.8 billion**, MSA Safety employs a team of over **5,000 associates** across its more than **40 international locations**[24](index=24&type=chunk) [Cautionary Statement Regarding Forward-Looking Statements](index=12&type=section&id=8.2.%20Cautionary%20Statement%20Regarding%20Forward-Looking%20Statements) This press release contains forward-looking statements subject to various risks and uncertainties that could cause actual results to differ materially, and readers should not place undue reliance on them - Certain matters discussed in this press release may be 'forward-looking statements' relating to future events or financial performance[25](index=25&type=chunk) - These statements involve various assumptions, known and unknown risks, uncertainties and other factors that may cause actual results to be materially different[25](index=25&type=chunk) - The company is under no duty to update publicly any of the forward-looking statements after the date of this earnings press release, except as required by law[25](index=25&type=chunk) [Non-GAAP Financial Measures Disclosure](index=12&type=section&id=8.3.%20Non-GAAP%20Financial%20Measures%20Disclosure) The press release includes non-GAAP financial measures to aid investor understanding of operating performance and trends, which are supplemental and not substitutes for GAAP results, with reconciliations provided - This press release includes certain non-GAAP financial measures such as organic sales change, adjusted operating income, adjusted EBITDA, adjusted earnings, and debt to adjusted EBITDA[26](index=26&type=chunk) - These non-GAAP financial measures provide information useful to investors in understanding operating performance and trends, and for internal management assessment[26](index=26&type=chunk) - These non-GAAP financial measures should be viewed as supplemental in nature, and not as a substitute for, or superior to, reported results prepared in accordance with GAAP[28](index=28&type=chunk)

Core Insights - MSA Safety Incorporated reported a solid financial performance for Q1 2025, with a net sales increase of 2% year-over-year, reaching $421.3 million, and a 4% organic sales growth [4][5][10] - The company maintained its low-single-digit organic sales growth outlook for the full year 2025, despite acknowledging increased macroeconomic risks [7][8] Financial Highlights - Net sales for Q1 2025 were $421.3 million, compared to $413.3 million in Q1 2024, reflecting a 2% increase [4][10] - GAAP operating income was $77.8 million, or 18.5% of net sales, down from 19.4% in the previous year [4][10] - Net income increased by 3% to $59.6 million, with diluted earnings per share (EPS) rising to $1.51 [4][10] - Adjusted EBITDA remained stable at $101.5 million, with an adjusted operating income of $87.5 million, representing 20.8% of net sales [4][10] - Free cash flow improved significantly, reaching $51 million, a 29% increase from the previous year [5][10] Segment Performance - The Americas segment reported net sales of $293.2 million, a slight decline of 1% year-over-year, with GAAP operating income down 9% [4][10] - The International segment saw a robust 9% increase in net sales to $128.2 million, with GAAP operating income rising by 56% [4][10] Capital Allocation - The company returned $30 million to shareholders through dividends and share repurchases, while also investing $11 million in capital expenditures and repaying $7 million of debt [5][10] - MSA Safety closed an upsized Revolving Credit Facility in April, providing a capacity of $1.3 billion [5][10] Market Outlook - MSA Safety's management expressed confidence in the company's ability to navigate a dynamic market environment, emphasizing customer-driven innovation and a commitment to long-term value creation [3][7] - The company is closely monitoring macroeconomic factors, including tariffs, which could impact future performance [7][8]

Core Insights - MSA Safety, Inc. has secured a $10 million contract to provide respiratory protective equipment to the Orange County Fire Authority, enhancing its market presence in Southern California [1][6] - The Orange County Fire Authority selected MSA's G1 self-contained breathing apparatus (SCBA) due to its advanced technology, connectivity features, and upgradeability [2][4] - The G1 SCBA is part of the MSA Connected Firefighter platform, which includes 15 U.S. patents and improves firefighter monitoring and communication through the FireGrid® system [3][4] Company Overview - MSA Safety is a global leader in advanced safety products and technologies, with 2024 revenues of $1.8 billion and over 5,000 employees across more than 40 international locations [7] - The company has been at the forefront of safety innovation since 1914, focusing on protecting workers and infrastructure across diverse end markets [7] Product Features - The G1 SCBA features an integrated thermal imaging camera (iTIC), allowing individual firefighters to access thermal imaging capabilities [4] - The SCBA transmits critical data such as air pressure and battery status to incident commanders in real time, enhancing operational efficiency [3][4] Partnership Significance - The partnership with the Orange County Fire Authority is seen as a significant achievement for MSA Safety, emphasizing the company's commitment to protecting first responders [6]