Fuller(FUL)2025-03-27 11:47Financial Performance - Net revenue for Q1 2025 was $789 million, a decrease of 2.7% year-on-year; organic revenue increased by 1.9% driven by a 1.7% volume increase[5]. - Adjusted EBITDA for Q1 2025 was $114 million, down 7% year-on-year, primarily due to higher raw material costs and variable compensation[9]. - Adjusted EPS (diluted) for Q1 2025 was $0.54, compared to $0.55 in Q1 2024, reflecting a decrease in net income attributable to H.B. Fuller of $13 million[9]. - The gross margin for Q1 2025 was 28.8%, with an adjusted gross margin of 29.6%, down 50 basis points year-on-year due to increased raw material costs[7]. - Net income attributable to H.B. Fuller for the three months ended March 1, 2025, was $13,248, compared to $30,991 for the same period in 2024, representing a decline of 57.3%[26]. - Adjusted net income attributable to H.B. Fuller decreased to $29,997 from $37,692 year-over-year, a reduction of 20.5%[26]. - Revenue for the three months ended March 1, 2025, was $788,663, down from $810,419 in the prior year, reflecting a decrease of 2.5%[32]. - Adjusted EBITDA for the same period was $114,356, compared to $123,018 in 2024, indicating a decline of 7.1%[32]. - The adjusted EBITDA margin decreased to 14.5% from 15.2% year-over-year[32]. - H.B. Fuller reported a net income attributable to the company of $70,315,000 for the three months ended March 1, 2025, compared to $84,331,000 for the same period in 2024, reflecting a decrease of approximately 16.6%[44]. - The total revenue for H.B. Fuller was $788,663,000 for the three months ended March 1, 2025, a decline of 2.7% compared to the previous year[50]. - Organic growth for H.B. Fuller was reported at 1.9%, while the impact of foreign exchange (F/X) was a decline of 3.4%[50]. - The Hygiene, Health and Consumable Adhesives segment experienced a revenue growth of 4.2% on an organic basis, while Engineering Adhesives saw a decline of 1.9%[50]. Shareholder Returns - The company repurchased 678 thousand shares during the quarter, reflecting a commitment to returning value to shareholders[6]. Future Projections - For fiscal 2025, net revenue growth is expected to decline by 2% to 4%, while organic revenue growth is projected to be flat to up 2%[16]. - Adjusted EBITDA for fiscal 2025 is anticipated to be in the range of $600 million to $625 million, representing a year-on-year growth of approximately 1% to 5%[16]. Debt and Cash Flow - Net debt at the end of Q1 2025 was $2,074 million, an increase of $233 million sequentially and $409 million year-on-year, primarily driven by acquisitions[11]. - Cash flow from operations is expected to be weighted towards the second half of 2025 due to higher working capital needs associated with revenue growth[13]. - Total debt as of March 1, 2025, is $2,179,997, an increase from $2,010,639 as of November 30, 2024[60]. - Net debt as of March 1, 2025, is $2,074,254, compared to $1,841,287 as of November 30, 2024, reflecting a significant increase[60]. - Cash and cash equivalents decreased to $105,743 as of March 1, 2025, from $169,352 as of November 30, 2024[64]. - Net cash used in operating activities for the three months ended March 1, 2025, is $(52,907), compared to $47,351 for the same period in 2024[66]. Operational Costs - Acquisition project costs for the quarter amounted to $9,828,000, and organizational realignment costs were $8,774,000[44]. - The company incurred interest expenses of $32,030,000 during the quarter, contributing to the overall financial adjustments[44]. Segment Performance - Segment revenue for Hygiene, Health and Consumable Adhesives was $368,225, slightly up from $368,078, while Engineering Adhesives increased to $236,758 from $226,075[32]. - Total segment operating income decreased to $46,447 from $66,875, a decline of 30.6%[32]. - The gross profit margin for the three months ended March 1, 2025, was 28.8%, down from 29.5% in the prior year[39]. - Adjusted gross profit margin decreased to 29.6% from 30.1% year-over-year[39]. - The revenue for the Building Adhesive Solutions segment was $179,666,000, with an adjusted EBITDA of $21,410,000[47]. Investments - The company has made significant investments, with $162,032 used for purchased businesses in the three months ended March 1, 2025[66].