Materion (US:MTRN)2025-10-29 10:48Financial Performance - Net sales for Q3 2025 were $444.8 million, an increase from $436.7 million in the prior year period[7] - Net income for the quarter was $25.4 million, or $1.22 per diluted share, compared to $22.3 million, or $1.07 per share, in the prior year[7] - Adjusted EBITDA was $55.5 million, representing 21.0% of value-added sales, down from $56.7 million or 21.5% in the prior year[8] - Total net sales for the nine months ended September 26, 2025, reached $1,296.8 million, up from $1,247.9 million in the prior year, reflecting a growth of 3.9%[25] - Net income for the nine months ended September 26, 2025, was $68,250,000, an increase from $54,739,000 for the same period in 2024, representing a growth of 24.5%[24] - The company reported a total EBITDA of $152.5 million for the nine months ended September 26, 2025, compared to $138.8 million in the same period of 2024, a rise of 9.0%[26] - Adjusted net income for Q3 2025 was $27.3 million, with adjusted diluted EPS of $1.31, compared to $27.1 million and $1.29 in Q3 2024[31] Segment Performance - Performance Materials segment net sales decreased to $170.8 million in Q3 2025 from $177.4 million in Q3 2024[32] - Electronic Materials segment net sales increased to $246.8 million in Q3 2025, up from $236.9 million in Q3 2024[33] - Precision Optics reported net sales of $27.2 million for the third quarter ended September 26, 2025, an increase of 21.4% compared to $22.4 million for the same period in 2024[34] Margins and EBITDA - Record EBITDA margins of 27.1% in Electronic Materials, up 700 basis points year on year[6] - Precision Optics transformation resulted in approximately 1000 basis points of margin expansion year on year[6] - Consolidated EBITDA for Q3 2025 was $53.2 million, up from $50.5 million in Q3 2024, reflecting an EBITDA margin of 12.0% of net sales[28] - Adjusted EBITDA for Q3 2025 was $55.5 million, with an adjusted EBITDA margin of 12.5% of net sales, compared to 13.0% in Q3 2024[28] - Adjusted EBITDA for the Electronic Materials segment was $21.6 million in Q3 2025, compared to $15.6 million in Q3 2024[33] - Adjusted EBITDA for Precision Optics was $3.2 million in Q3 2025, with an adjusted EBITDA margin of 11.8% of net sales, compared to 2.2% in Q3 2024[34] - Total adjusted EBITDA for the Other segment was $(7.3) million in Q3 2025, compared to $(5.9) million in Q3 2024, indicating a decline in performance[35] Cash Flow and Investments - Total net cash provided by operating activities increased significantly to $83,724,000 from $11,564,000 year-over-year[24] - Cash and cash equivalents at the end of the period were $16,411,000, down from $17,874,000 at the end of the previous year[24] - The company invested $38,741,000 in property, plant, and equipment during the nine months ended September 26, 2025, compared to $50,730,000 in the same period of 2024[24] - The company’s financing activities resulted in a net cash outflow of $8,417,000, a significant decrease from a net inflow of $52,926,000 in the previous year[24] Strategic Initiatives - Materion announced a supply agreement with Commonwealth Fusion Systems for materials in fusion technologies[6] - The Board of Directors authorized a new $50 million stock repurchase program, replacing the existing program[6] - The company’s pricing policy aims to pass the cost of metals to customers to mitigate price volatility impacts on operations[27] Gross Margins - Total gross margin for Materion Corporation was $86.1 million in Q3 2025, up from $80.9 million in Q3 2024, reflecting a growth of 3.1%[37] - Performance Materials segment gross margin decreased to $44.7 million in Q3 2025 from $51.8 million in Q3 2024, indicating a decline of 8.6%[37] - Electronic Materials segment gross margin increased to $33.1 million in Q3 2025, up from $23.3 million in Q3 2024, representing a growth of 42.0%[37] - Precision Optics gross margin was $8.3 million in Q3 2025, compared to $5.8 million in Q3 2024, marking a 43.1% increase[37] - Adjusted gross margin for Materion Corporation totaled $86.7 million in Q3 2025, compared to $84.8 million in Q3 2024, reflecting a growth of 2.2%[37] Special Items and Expenses - The company incurred total special items of $2.3 million in Q3 2025, down from $6.2 million in Q3 2024[28] - Restructuring and cost reduction expenses for the Other segment were $0.5 million in Q3 2025, compared to $0.5 million in Q3 2024[35]