ESAB (US:ESAB)2025-10-29 10:31Financial Performance - ESAB reported third quarter sales of $728 million, an increase of 8% year-over-year, with core organic growth of 2%[3] - Net income from continuing operations attributable to ESAB was $64 million, or $1.04 diluted earnings per share[3] - Core adjusted EBITDA rose 7% to $133 million, with a margin decrease of 20 basis points to 19.4% compared to the prior year[3] - ESAB's total net income for the third quarter was $56.5 million, down from $69.8 million in the prior year[22] - Adjusted net income from continuing operations for the three months ended October 3, 2025, was $83.2 million, compared to $78.6 million for the same period in 2024, representing a growth of 8.5%[24] - Adjusted net income margin from continuing operations was 11.4% for the three months ended October 3, 2025, slightly down from 11.7% in the same period of 2024[24] - Net income from continuing operations attributable to ESAB Corporation (GAAP) for the three months ended October 3, 2025, was $63.7 million, down from $69.4 million in the same period of 2024, a decrease of 10.1%[24] - Net income for the nine months ended October 3, 2025, was $194,457, down from $215,796 for the same period in 2024, representing a decrease of approximately 9.5%[43] Sales and Growth - The U.S. business returned to mid-single-digit growth, while EMEA and APAC regions experienced strong demand from high-growth markets[4] - The company raised its full-year 2025 outlook for total core sales growth to 4.5% to 5.5% and core adjusted EBITDA guidance to $535 to $540 million[6] - Core adjusted EPS guidance was narrowed to $5.20 to $5.30, up from the previous range of $5.15 to $5.30[6] - For the three months ended September 27, 2024, total sales reached $673.3 million, reflecting an 8.1% increase compared to the previous year[32] - Organic sales growth for existing businesses was 1.6%, with a total increase of $54.6 million in sales attributed to this segment[32] - Acquisitions contributed $33.8 million to total sales, representing a 5.0% increase[32] - For the nine months ended September 27, 2024, total sales were $2,070.0 million, with a decline of 4.3% attributed to existing businesses[34] - The company expects 2025 core net sales growth in the range of 4.5% to 5.5%[39] Adjusted Financial Metrics - Adjusted EBITDA for the three months ended October 3, 2025, was $139.5 million, an increase from $127.4 million in the same period of 2024, reflecting a growth of 9.3%[27] - Core adjusted EBITDA margin for the three months ended October 3, 2025, was 19.4%, compared to 19.6% for the same period in 2024[27] - Adjusted net income per share – diluted from continuing operations (non-GAAP) for the three months ended October 3, 2025, was $1.36, compared to $1.28 for the same period in 2024, an increase of 6.3%[24] Acquisitions and Investments - ESAB completed the EWM acquisition, enhancing its heavy equipment and automation portfolio and providing access to leading React technology[5] - The company is focusing on cross-selling initiatives and margin-expansion opportunities post-acquisition[5] - Restructuring and other related charges for the three months ended October 3, 2025, amounted to $4.3 million, compared to $1.9 million in the same period of 2024[27] - Acquisition-amortization and other related charges for the three months ended October 3, 2025, were $16.5 million, up from $10.1 million in the same period of 2024[27] - The company made acquisitions totaling $439,669, a substantial increase from $86,537 in the prior year, reflecting a growth of about 408.5%[43] Cash Flow and Assets - Adjusted free cash flow for the three months ended October 3, 2025, was $86.4 million, compared to $95.8 million for the same period in 2024[36] - Total assets as of October 3, 2025, were $4,869.4 million, an increase from $4,033.9 million at the end of 2024[41] - Current liabilities totaled $669.1 million as of October 3, 2025, compared to $632.1 million at the end of 2024[41] - Net cash provided by operating activities decreased to $163,514 from $228,523, a decline of about 28.5% year-over-year[43] - Cash used in investing activities significantly increased to $462,053 compared to $114,214 in the previous year, indicating a rise of approximately 304.5%[43] - Net cash provided by financing activities rose to $227,263 from $40,576, marking an increase of approximately 460.5%[43] - Cash and cash equivalents at the end of the period were $218,219, down from $253,670, a decrease of about 14%[43] Other Financial Information - The company reported a loss from discontinued operations of $8.8 million in the third quarter[22] - The company reported a pension settlement loss of $12.2 million for the nine months ended September 27, 2024[24] - The company experienced a net loss on the sale of property, plant, and equipment amounting to $5,697, compared to a loss of $1,060 in the previous year[43] - Depreciation, amortization, and other impairment charges increased to $58,731 from $50,028, reflecting a rise of approximately 17.4%[43] - Trade receivables net decreased by $50,381, compared to a decrease of $39,075 in the previous year, indicating a worsening in collection efficiency[43] - The effect of foreign exchange rates on cash and cash equivalents resulted in an increase of $40,137, contrasting with a decrease of $3,218 in the prior year[43]