WD-40 pany(US:WDFC)2025-10-27 20:12Financial Performance - Consolidated net sales increased by $29.4 million, or 5%, for fiscal year 2025 compared to the prior fiscal year, with sales volume contributing approximately $25.2 million and average selling price contributing approximately $5.6 million[134] - Consolidated net income rose by $21.4 million, or 31%, for fiscal year 2025, with foreign currency exchange rates having an insignificant effect on net income[134] - Diluted earnings per share for fiscal year 2025 were $6.69, up from $5.11 in the prior fiscal year, with adjusted diluted EPS on a non-GAAP basis at $5.82[134] - Gross profit as a percentage of net sales increased to 55.1% for fiscal year 2025, compared to 53.4% for the prior fiscal year[134] - Net income for fiscal year 2025 was $91.0 million, or $6.69 per diluted share, compared to $69.6 million, or $5.11 per diluted share, for fiscal year 2024[164] Segment Performance - Total net sales in the Americas segment increased by $8.7 million, or 3%, with WD-40 Multi-Use Product sales increasing by $8.0 million, or 4%[137][138] - EIMEA segment net sales increased by $15.4 million, or 7%, with WD-40 Multi-Use Product sales rising by $13.2 million, or 8%[140] - EIMEA segment net sales increased by $13.2 million, or 8%, driven by higher sales volume across regions, particularly in France, Iberia, Benelux, and Italy[142] - Asia-Pacific segment net sales rose by $5.3 million, or 6%, with WD-40 Multi-Use Product sales increasing by $3.8 million, or 6%[144] - Operating income for the Americas segment remained stable at $65.4 million, with a slight increase in gross margin from 50.9% to 52.1%[156] - Asia-Pacific operating income increased to $30.8 million, up $1.1 million, or 4%, with a gross margin increase from 58.0% to 58.7%[158] Expenses and Costs - Operating expenses increased by $18.7 million, or 9%, for fiscal year 2025 compared to the prior fiscal year[135] - SG&A expenses increased by $16.1 million, or 9%, totaling $199.9 million, representing 32.2% of net sales[148] - Research and development costs rose to $8.7 million from $8.0 million, reflecting increased activity in sustainability initiatives[151] - Advertising and sales promotion expenses increased by $3.5 million, or 10%, totaling $37.4 million, which is 6.0% of net sales[152] - Total operating expenses increased to $237.6 million in 2025 from $218.9 million in 2024, with the cost of doing business as a percentage of net sales rising to 37%[169] Cash Flow and Liquidity - Cash provided by operating activities decreased to $87.9 million in 2025 from $92.0 million in 2024[180] - The company had $58.1 million in cash and cash equivalents as of August 31, 2025, indicating strong liquidity[177] - Changes in working capital decreased net cash provided by operating activities by $10.5 million for fiscal year 2025, compared to a $4.6 million increase in the prior fiscal year, resulting in a net unfavorable change of $15.1 million[182] - Increases in inventory balances decreased net cash provided by operating activities by $11.6 million, primarily in the EIMEA segment due to onboarding new packagers for regional expansion[182] - Net cash used in investing activities decreased by $7.3 million to $2.4 million for fiscal year 2025, primarily due to the prior year acquisition of a Brazilian distributor for $6.2 million[184] - Net cash used in financing activities decreased by $9.8 million to $74.1 million for fiscal year 2025, mainly due to lower net repayments on the revolving credit facility of $17.5 million[185] Shareholder Returns - The company returned approximately $62.6 million to stockholders through share repurchases and dividends during the fiscal year[134] - The Board approved a share repurchase plan allowing for the acquisition of up to $50.0 million of outstanding shares, with $29.6 million remaining available as of August 31, 2025[179] - The Board approved a 7% increase in the regular quarterly cash dividend, raising it from $0.88 per share to $0.94 per share, with a cash dividend declared for October 31, 2025[189] Tax and Interest - Interest expense decreased by $0.8 million to $3.4 million, primarily due to a decrease in the weighted average outstanding balance on the revolving credit facility[161] - The provision for income taxes decreased from 23.9% in 2024 to 10.5% in 2025 of income before income taxes[163] Other Financial Metrics - Adjusted EBITDA for fiscal year 2025 was $114.4 million, representing 18% of net sales, consistent with the previous year[171] - Other income (expense), net improved by $1.8 million, moving from a loss of $1.0 million in 2024 to a gain of $0.8 million in 2025[162] - The net effect of exchange rate changes on cash and cash equivalents was not significant in both fiscal years 2025 and 2024, with an increase in cash of $3.2 million in fiscal year 2023[186] - The company does not enter into hedging activities to mitigate foreign currency translation risk, although it engages in foreign currency forward contracts to limit exposure to net asset balances held in non-functional currencies[198]