Universal (UVV) - 2025 Q4 - Annual Results

Financial Performance - Revenue for Fiscal Year 2025 reached $2.9 billion, an increase of 7% year-over-year[2] - Operating income for Fiscal Year 2025 was $232.8 million, up 5% year-over-year[2] - Net income for the fiscal year ended March 31, 2025, was $113,269,000, a decrease of 14.9% from $132,971,000 in 2024[33] - Adjusted operating income for Q1 2025 was $42,760,000, down from $72,952,000 in Q1 2024, while fiscal year 2025 adjusted operating income increased to $243,370,000 from $230,286,000 in fiscal year 2024[21] - Net income attributable to Universal Corporation for Q1 2025 was $9,338,000, a decrease from $40,318,000 in Q1 2024, with fiscal year 2025 net income at $95,047,000 compared to $119,598,000 in fiscal year 2024[27] - Basic earnings per share for the fiscal year ended March 31, 2025, was $3.81, down from $4.81 in 2024, a decrease of 20.8%[36] - Diluted earnings per share for Q1 2025 were $0.37, down from $1.61 in Q1 2024, while adjusted diluted earnings per share were $0.80 compared to $1.79 in Q1 2024[21] Segment Performance - Tobacco Operations segment sales decreased by 12% to $612.6 million in Q4 2025, while operating income fell by 38% to $45.8 million[9] - Ingredients Operations segment sales increased by 20% to $89.7 million in Q4 2025, with operating income rising significantly to $4.4 million[9] - Sales and other operating revenues for the Tobacco Operations segment were $612,624,000 for the three months ended March 31, 2025, compared to $696,281,000 in the same period of 2024, a decline of 12.0%[42] - The Ingredients Operations segment generated $89,655,000 in sales for the three months ended March 31, 2025, compared to $74,579,000 in 2024, an increase of 20.2%[42] - Sales and other operating revenues for the fiscal year ended March 31, 2025, were $2,608,675,000 for Tobacco operations and $338,609,000 for Ingredients operations, compared to $2,438,775,000 and $309,798,000 respectively for the fiscal year ended March 31, 2024, indicating an increase of 6.98% in Tobacco and 9.33% in Ingredients[43] Debt and Cash Flow - Cash balance at fiscal year-end was $260.1 million, with total debt increasing by $38.4 million[13] - Total debt as of March 31, 2025, was $1,072,957,000, an increase from $1,034,581,000 as of March 31, 2024[22] - Net debt decreased to $816,605,000 in 2025 from $996,167,000 in 2024, resulting in a net debt to net capitalization ratio of 36% compared to 41% in the previous year[22] - Cash provided by operating activities was $326,974,000 for the fiscal year ended March 31, 2025, compared to a cash used of $74,632,000 in 2024[33] Restructuring and Costs - Restructuring and impairment costs amounted to $10.6 million related to the consolidation of European sheet operations[13] - The company incurred restructuring and impairment costs of $10,573,000 in 2025, compared to $3,523,000 in 2024, indicating increased restructuring efforts[33] - Corporate overhead allocated to segments for the fiscal year ended March 31, 2025, was $65,195,000 for Tobacco operations, compared to $61,655,000 in the previous year, reflecting an increase of 5.51%[43] Future Outlook and Strategy - The company expects to leverage its extensive supply chain expertise and global reach to drive efficiency and deliver value to customers in the future[24] - The company is focused on strategic investments and acquisitions to enhance its market position and integrate new businesses[25] - The company anticipates potential risks including reliance on a few large customers and shifts in customer requirements for leaf tobacco, which could impact future performance[25] - The company is focusing on enhancing operational efficiency and exploring new market opportunities to drive future growth[43] Crop Expectations - Flue-cured and burley tobacco crops outside of China are expected to increase by 20% and 30%, respectively, in Fiscal Year 2026[13]