Net Revenue of $789 million, down 2.7%
year-on-year; Organic revenue up 1.9% year-on-year Net income of
$13 million; Reported EPS (diluted) of $0.24; Adjusted EPS
(diluted) of $0.54 Adjusted EBITDA of $114 million; Adjusted EBITDA
margin of 14.5% Repurchased 678 thousand shares in the first
quarter
H.B. Fuller Company (NYSE: FUL) today reported financial results
for its first quarter that ended March 1, 2025.
First Quarter 2025 Noteworthy Items:
- Net revenue was $789 million; unfavorable foreign currency
translation and the divestiture of the flooring business resulted
in net revenue declining 2.7% year-on-year; organic revenue was up
1.9% year-on-year driven by improved volume;
- Gross margin was 28.8%; adjusted gross margin of 29.6%
decreased slightly year-on-year driven by increased raw material
costs;
- Net income was $13 million; adjusted EBITDA was $114 million,
down 7% versus last year, as expected, as volume growth and
positive pricing was more than offset by higher raw material costs
and variable compensation;
- Repurchased 678 thousand shares during the quarter.
Summary of First Quarter 2025 Results:
The Company’s net revenue for the first quarter of fiscal 2025
was $789 million, down 2.7% versus the first quarter of fiscal
2024. Organic revenue increased 1.9% year-on-year, with pricing
increasing 0.2% and volume increasing 1.7%. Foreign currency
translation decreased net revenue by 3.4% and
acquisitions/divestitures decreased net revenue by 1.2%.
Gross profit in the first quarter of fiscal 2025 was $227
million. Adjusted gross profit was $233 million. Adjusted gross
profit margin of 29.6% decreased 50 basis points year-on-year.
While raw material cost inflation has started to moderate, it was
still up year-on-year in the first quarter, resulting in the
decline in adjusted gross margin.
Selling, general and administrative (SG&A) expense was $181
million in the first quarter of fiscal 2025 and adjusted SG&A
was $169 million, up 2 percent year-on-year. The impact of
acquisitions and higher variable compensation drove most of the
year-on-year increase in adjusted SG&A.
Net income attributable to H.B. Fuller for the first quarter of
fiscal 2025 was $13 million. Adjusted net income attributable to
H.B. Fuller for the first quarter of fiscal 2025 was $30 million.
Reported EPS (diluted) was $0.24 and Adjusted EPS (diluted) was
$0.54.
Adjusted EBITDA in the first quarter of fiscal 2025 was $114
million, down 7% year-on-year, as expected, driven by the impact of
higher raw material costs and higher variable compensation.
“I am encouraged by our first quarter financial performance and
positive organic sales growth,” said Celeste Mastin, president and
chief executive officer. “Despite weak overall market demand
conditions, we remain focused on pricing discipline, market share
gains, and effectively managing our cost structure. Simultaneously,
we continue to execute our long-term strategic plan to optimize our
portfolio mix and streamline our manufacturing cost structure to
drive our business toward our greater than 20% EBITDA margin
target.
“As we look ahead, we remain cautious given weak overall market
demand and unpredictable geopolitical conditions around the globe.
Nevertheless, we are off to a solid start to the year and remain
confident we can successfully adapt and execute in this dynamic
environment to deliver growth in both organic sales and EBITDA for
the year, while expanding EBITDA margin.”
Balance Sheet and Working Capital:
Net debt at the end of the first quarter of fiscal 2025 was
$2,074 million, up $233 million sequentially versus the fourth
quarter and up $409 million year-on-year. Acquisitions principally
drove the increase in net debt, both year-on-year and sequentially.
Net debt-to-adjusted EBITDA increased to 3.5X at the end of the
first quarter of fiscal 2025.
Net working capital in the first quarter of fiscal 2025
increased $9 million sequentially versus the fourth quarter and
declined $12 million year-on-year. As a percentage of annualized
net revenue, net working capital was essentially flat year-on-year.
Cash flow from operations was down versus last year, as expected,
driven by higher working capital needs associated with revenue
growth. As previously communicated, cash flow delivery for 2025 is
expected to be weighted to the second half of the year.
Fiscal 2025 Outlook:
The Company’s full year outlook for fiscal year 2025 remains
unchanged from what was previously communicated in January of this
year.
- Net revenue growth for fiscal 2025 is expected to be down 2% to
4%, adjusting for the divestiture of the Flooring business, net
revenue is expected to be up 1% to 2%;
- Organic revenue growth is expected to be flat to up 2% versus
fiscal 2024;
- Adjusted EBITDA for fiscal 2025 is expected to be in the range
of $600 million to $625 million, equating to growth of
approximately 1% to 5% year-on-year;
- Adjusted EPS (diluted) is expected to be in the range of $3.90
to $4.20, equating to a range of up 2% to 9% year-on-year;
- Operating cash flow in fiscal year 2025 is expected to be
between $300 million and $325 million;
- Adjusted EBITDA for the second quarter of 2025 is expected to
be in the range of $150 million to $160 million.
Conference Call:
The Company will hold a conference call on March 27, 2025, at
9:30 a.m. CT (10:30 a.m. ET) to discuss its results. Interested
parties may listen to the conference call on a live webcast. The
webcast, along with a supplemental presentation, may be accessed
from the Company’s website at https://investors.hbfuller.com.
Participants must register prior to accessing the webcast using
this link and should do so at least 10 minutes prior to the start
of the call to install and test any necessary software and audio
connections. A telephone replay of the conference call will be
available from 12:30 p.m. CT on March 27, 2025, to 10:59 p.m. CT on
April 3, 2025. To access the telephone replay dial 1-800-770-2030
(toll free) or 1-609-800-9909, and enter Conference ID:
6370505.
Regulation G:
The information presented in this earnings release regarding
consolidated and segment organic revenue growth, operating income,
adjusted gross profit, adjusted gross profit margin, adjusted
selling, general and administrative expense, adjusted income before
income taxes and income from equity investments, adjusted income
taxes, adjusted effective tax rate, adjusted net income, adjusted
diluted earnings per share, adjusted earnings before interest,
taxes, depreciation, and amortization (EBITDA), adjusted EBITDA
margin, net debt, net debt-to-adjusted EBITDA, trailing twelve
months adjusted EBITDA, net working capital, annualized net revenue
and net working capital as a percentage of annualized net revenue
does not conform to U.S. generally accepted accounting principles
(U.S. GAAP) and should not be construed as an alternative to the
reported results determined in accordance with U.S. GAAP.
Management has included this non-GAAP information to assist in
understanding the operating performance of the Company and its
operating segments as well as the comparability of results to the
results of other companies. The non-GAAP information provided may
not be consistent with the methodologies used by other companies.
All non-GAAP information is reconciled with reported U.S. GAAP
results in the “Regulation G Reconciliation” tables in this press
release with the exception of our forward-looking non-GAAP measures
contained above in our Fiscal 2025 Outlook, which the Company
cannot reconcile to forward-looking GAAP results without
unreasonable effort.
About H.B. Fuller:
As the largest pureplay adhesives company in the world, H.B.
Fuller’s (NYSE: FUL) innovative, functional coatings, adhesives and
sealants enhance the quality, safety and performance of products
people use every day. Founded in 1887, with 2024 revenue of $3.6
billion, our mission to Connect What Matters is brought to life by
more than 7,500 global team members who collaborate with customers
across more than 30 market segments in over 140 countries to
develop highly specified solutions that enable customers to bring
world-changing innovations to their end markets. Learn more at
www.hbfuller.com.
Safe Harbor for Forward-Looking Statements:
Certain statements in this press release may be considered
forward-looking statements within the meaning of the federal
securities laws, including Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. Such statements often address expected future
business and financial performance, financial condition, and other
matters, and often contain words or phrases such as “anticipate,”
“believe,” “estimate,” “expect,” “intend,” “may,” “opportunity,”
“outlook,” “plan,” “project,” “seek,” “should,” “strategy,”
“target,” “will,” “will be,” “will continue,” “will likely result,”
“would” and similar expressions, and variations or negatives of
these words or phrases. These statements are subject to various
risks and uncertainties that could cause our actual results to
differ materially from those in the forward-looking statements,
including but not limited to the following: the availability and
pricing of raw materials; the impact of potential cybersecurity
attacks and security breaches; failures in our information
technology systems; the impact on the supply chain, raw material
costs and pricing of our products due to military conflict,
including between Russia and Ukraine and in the Middle East; the
impact on our margins and product demand due to inflationary
pressures; the substantial amount of debt we have incurred to
finance our acquisition of Royal, our ability to repay or refinance
our debt or to incur additional debt in the future, our need for a
significant amount of cash to service and repay the debt and to pay
dividends on our common stock, and the effect of debt covenants
that limit the discretion of management in operating the business
or in paying dividends; our ability to pay dividends and to pursue
growth opportunities if we continue to pay dividends according to
our current dividend policy; our ability to effectively manage and
realize expected benefits from completed and future mergers,
acquisitions, and divestitures; our ability to achieve expected
synergies, cost savings and operating efficiencies from our
restructuring initiatives and operational improvement projects
within the expected time frames or at all; our ability to
effectively implement Project ONE; uncertain political and economic
conditions; fluctuations in product demand; competing products and
pricing; our geographic and product mix; disruptions to our
relationships with our major customers and suppliers; regulatory
compliance across our global footprint; trade policies and economic
sanctions impacting our markets; changes in tax laws and tariffs;
devaluations and other foreign exchange rate fluctuations; the
impact of litigation and investigations, including for product
liability and environmental matters; impairment charges on our
goodwill or long-lived assets; the consequences of the COVID-19
outbreak and other pandemics on our operations and financial
results; the effect of new accounting pronouncements and accounting
charges and credits; and similar matters.
Additional information about these various risks and
uncertainties can be found in the “Risk Factors” section of our
Form 10-K filings, and any updates to the risk factors in our Form
10-Q and 8-K filings with the SEC, but there may be other risks and
uncertainties that we are unable to identify at this time or that
we do not currently expect to have a material impact on the
business. You should not place undue reliance on forward-looking
statements, which speak only as of the date they are made. We do
not undertake to update or revise any forward-looking statements,
except as required by law.
H.B. FULLER COMPANY AND
SUBSIDIARIES
CONSOLIDATED FINANCIAL
INFORMATION
In thousands, except per share
amounts (unaudited)
Three Months Ended
Percent of
Three Months Ended
Percent of
March 1, 2025
Net Revenue
March 2, 2024
Net Revenue
Net revenue
$
788,663
100.0
%
$
810,419
100.0
%
Cost of sales
(561,588
)
(71.2
)%
(571,182
)
(70.5
)%
Gross profit
227,075
28.8
%
239,237
29.5
%
Selling, general and administrative
expenses
(180,628
)
(22.9
)%
(172,362
)
(21.3
)%
Other income, net
3,207
0.4
%
1,501
0.2
%
Interest expense
(32,042
)
(4.1
)%
(31,901
)
(3.9
)%
Interest income
1,100
0.1
%
1,307
0.2
%
Income before income taxes and income from
equity method investments
18,712
2.4
%
37,782
4.7
%
Income taxes
(5,945
)
(0.8
)%
(7,814
)
(1.0
)%
Income from equity method investments
497
0.1
%
1,044
0.1
%
Net income including non-controlling
interest
13,264
1.7
%
31,012
3.8
%
Net income attributable to non-controlling
interest
(16
)
(0.0
)%
(21
)
(0.0
)%
Net income attributable to H.B. Fuller
$
13,248
1.7
%
$
30,991
3.8
%
Basic income per common share attributable
to H.B. Fuller
$
0.24
$
0.57
Diluted income per common share
attributable to H.B. Fuller
$
0.24
$
0.55
Weighted-average common shares
outstanding:
Basic
54,998
54,702
Diluted
56,029
56,573
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands, except per share
amounts (unaudited)
Three Months Ended
March 1,
March 2,
2025
2024
Net income attributable to H.B. Fuller
$
13,248
$
30,991
Adjustments:
Acquisition project costs1
9,828
2,043
Organizational realignment2
8,774
7,262
Project One3
3,064
3,213
Discrete tax items4
992
(2,527
)
Income tax effect on adjustments5
(5,909
)
(3,290
)
Adjusted net income attributable to H.B.
Fuller6
29,997
37,692
Add:
Interest expense
32,030
31,901
Interest income
(1,100
)
(1,307
)
Adjusted Income taxes
10,862
13,631
Depreciation and Amortization expense7
42,567
41,101
Adjusted EBITDA6
114,356
123,018
Diluted Shares
56,029
56,573
Adjusted diluted income per common share
attributable to H.B. Fuller6
$
0.54
$
0.67
Revenue
$
788,663
$
810,419
Adjusted EBITDA margin6
14.5
%
15.2
%
1 Acquisition project costs include costs
related to evaluating, acquiring and integrating business
acquisitions. Acquisition project costs include $9,192 and $1,293
in transaction costs (primarily consulting and professional fees,
representations and warranties insurance premiums and employee
acquisition-related travel expenses) and $636 and $214 in purchase
accounting costs (primarily professional fees for valuation
services, inventory step-up cost and the impact of changes to
contingent consideration liabilities after the completion of the
purchase price allocation) and $0 and $536 in business integration
costs (primarily costs of transition services agreements and for
the three months ended March 2, 2024, retention bonuses paid to
employees of the acquired entities) for the three months ended
March 1, 2025 and March 2, 2024, respectively.
2 Organizational realignment includes
costs incurred as a direct result of the organizational realignment
program, including professional fees related to legal entity and
business structure changes, employee retention and severance costs,
and facility rationalization costs related to the closure of
production facilities and consolidation of business activities.
Facility rationalization costs include plant closure costs, the
impact of accelerated depreciation and for the three months ended
March 2, 2024, operational inefficiencies. Organizational
realignment includes $2,240 and $1,553 in professional fees related
to legal entity and business structure changes, $1,172 and $2,191
in employee severance and other related costs, and $5,362 and
$3,516 related to facility rationalization costs for the three
months ended March 1, 2025 and March 2, 2024, respectively.
3 Project One includes non-capitalizable
project costs related to implementing our global Enterprise
Resource Planning system, including upgrading to SAP S/4HANA®,
which has upgraded and standardized our information system.
4 Discrete tax items for the three months
ended March 1, 2025 are related to various foreign tax matters.
Discrete tax items for the three months March 2, 2024 are related
to various foreign tax matters as well as excess tax benefit
related to U.S. stock compensation.
5 The income tax effect on adjustments
represents the difference between income taxes on net income before
income taxes and income from equity method investments reported in
accordance with U.S. GAAP and adjusted net income before income
taxes and income from equity method investments.
6 Adjusted net income attributable to H.B.
Fuller, adjusted diluted income per common share attributable to
H.B. Fuller, adjusted EBITDA and adjusted EBITDA margin are
non-GAAP financial measures. Adjusted net income attributable to
H.B. Fuller is defined as net income before the specific
adjustments shown above. Adjusted diluted income per common share
is defined as adjusted net income attributable to H.B. Fuller
divided by the number of diluted common shares. Adjusted EBITDA is
defined as net income before interest, income taxes, depreciation,
amortization and the specific adjustments shown above. Adjusted
EBITDA margin is defined as adjusted EBITDA divided by net revenue.
The table above provides a reconciliation of adjusted net income
attributable to H.B. Fuller, adjusted diluted income per common
share attributable to H.B. Fuller, adjusted EBITDA and adjusted
EBITDA margin to net income attributable to H.B. Fuller, the most
directly comparable financial measure determined and reported in
accordance with U.S. GAAP.
7 Depreciation and amortization expense
added back for EBITDA is adjusted for amounts already included in
adjusted net income attributable to H.B. Fuller totaling ($30) and
($2,422) for the three months ended March 1, 2025 and March 2,
2024, respectively.
H.B. FULLER COMPANY AND
SUBSIDIARIES
SEGMENT FINANCIAL
INFORMATION
In thousands
(unaudited)
Three Months Ended
March 1,
March 2,
2025
2024
Net Revenue:
Hygiene, Health and Consumable
Adhesives
$
368,225
$
368,078
Engineering Adhesives
236,758
226,075
Building Adhesive Solutions
183,680
179,666
Corporate unallocated
-
36,600
Total H.B. Fuller
$
788,663
$
810,419
Segment Operating Income
(Loss):
Hygiene, Health and Consumable
Adhesives
$
29,949
$
47,393
Engineering Adhesives
28,051
25,820
Building Adhesive Solutions
6,577
7,139
Corporate unallocated
(18,130
)
(13,477
)
Total H.B. Fuller
$
46,447
$
66,875
Adjusted EBITDA6
Hygiene, Health and Consumable
Adhesives
$
46,891
$
62,863
Engineering Adhesives
44,188
38,202
Building Adhesive Solutions
21,803
21,410
Corporate unallocated
1,474
543
Total H.B. Fuller
$
114,356
$
123,018
Adjusted EBITDA Margin6
Hygiene, Health and Consumable
Adhesives
12.7
%
17.1
%
Engineering Adhesives
18.7
%
16.9
%
Building Adhesive Solutions
11.9
%
11.9
%
Corporate unallocated
0.0
%
1.5
%
Total H.B. Fuller
14.5
%
15.2
%
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands, except per share
amounts (unaudited)
Three Months Ended
March 1,
March 2,
2025
2024
Income before income taxes and income from
equity method investments
$
18,712
$
37,782
Adjustments:
Acquisition project costs1
9,828
2,043
Organizational realignment2
8,774
7,262
Project One3
3,064
3,213
Adjusted income before income taxes and
income from equity method investments8
$
40,378
$
50,300
8 Adjusted income before income taxes and
income from equity investments is a non-GAAP financial measure.
Adjusted income before income taxes and income from equity
investments is defined as income before income taxes and income
from equity investments before the specific adjustments shown
above. The table above provides a reconciliation of adjusted income
before income taxes and income from equity investments to income
before income taxes and income from equity investments, the most
directly comparable financial measure determined and reported in
accordance with U.S. GAAP.
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands, except per share
amounts (unaudited)
Three Months Ended
March 1,
March 2,
2025
2024
Income Taxes
$
(5,945
)
$
(7,814
)
Adjustments:
Acquisition project costs1
(2,680
)
(537
)
Organizational realignment2
(2,393
)
(1,908
)
Project One3
(836
)
(845
)
Discrete tax items4
992
(2,527
)
Adjusted income taxes9
$
(10,862
)
$
(13,631
)
Adjusted income before income taxes and
income from equity method investments
$
40,378
$
50,300
Adjusted effective income tax rate9
26.9
%
27.1
%
9 Adjusted income taxes and adjusted
effective income tax rate are non-GAAP financial measures. Adjusted
income taxes is defined as income taxes before the specific
adjustments shown above. Adjusted effective income tax rate is
defined as income taxes divided by adjusted income before income
taxes and income from equity method investments. The table above
provides a reconciliation of adjusted income taxes and adjusted
effective income tax rate to income taxes, the most directly
comparable financial measure determined and reported in accordance
with U.S. GAAP.
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands
(unaudited)
Three Months Ended
March 1,
March 2,
2025
2024
Net revenue
$
788,663
$
810,419
Gross profit
$
227,075
$
239,237
Gross profit margin
28.8
%
29.5
%
Adjustments:
Acquisition project costs1
607
81
Organizational realignment2
5,456
4,411
Project One3
94
-
Adjusted gross profit10
$
233,232
$
243,729
Adjusted gross profit margin10
29.6
%
30.1
%
10 Adjusted gross profit and adjusted
gross profit margin are non-GAAP financial measures. Adjusted gross
profit and adjusted gross profit margin is defined as gross profit
and gross profit margin excluding the specific adjustments shown
above. The table above provides a reconciliation of adjusted gross
profit and gross profit margin to gross profit and gross profit
margin, the most directly comparable financial measure determined
and reported in accordance with U.S. GAAP.
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands
(unaudited)
Three Months Ended
March 1,
March 2,
2025
2024
Selling, general and administrative
expenses
$
(180,628
)
$
(172,362
)
Adjustments:
Acquisition project costs1
7,706
1,962
Organizational realignment2
1,296
2,551
Project One3
2,970
3,213
Adjusted selling, general and
administrative expenses11
$
(168,656
)
$
(164,636
)
11 Adjusted selling, general and
administrative expenses is a non-GAAP financial measure. Adjusted
selling, general and administrative expenses is defined as selling,
general and administrative expenses excluding the specific
adjustments shown above. The table above provides a reconciliation
of adjusted selling, general and administrative expenses to
selling, general and administrative expenses, the most directly
comparable financial measure determined and reported in accordance
with U.S. GAAP.
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands
(unaudited)
Hygiene, Health
Building
Three Months Ended:
and Consumable
Engineering
Adhesive
Corporate
H.B. Fuller
March 1, 2025
Adhesives
Adhesives
Solutions
Total
Unallocated
Consolidated
Net income attributable to H.B. Fuller
$
32,160
$
29,023
$
9,132
$
70,315
$
(57,067
)
$
13,248
Adjustments:
Acquisition project costs1
-
-
-
-
9,828
9,828
Organizational realignment2
-
-
-
-
8,774
8,774
Project One3
-
-
-
-
3,064
3,064
Discrete tax items4
-
-
-
-
992
992
Income tax effect on adjustments5
-
-
-
-
(5,909
)
(5,909
)
Adjusted net income attributable to H.B.
Fuller6
32,160
29,023
9,132
70,315
(40,318
)
29,997
Add:
Interest expense
-
-
-
-
32,030
32,030
Interest income
-
-
-
-
(1,100
)
(1,100
)
Adjusted Income taxes
-
-
-
-
10,862
10,862
Depreciation and amortization expense7
14,731
15,165
12,671
42,567
-
42,567
Adjusted EBITDA6
$
46,891
$
44,188
$
21,803
$
112,882
$
1,474
$
114,356
Revenue
$
368,225
$
236,758
$
183,680
$
788,663
$
-
$
788,663
Adjusted EBITDA Margin6
12.7
%
18.7
%
11.9
%
14.3
%
NMP
14.5
%
Note: Adjusted EBITDA is a non-GAAP
financial measure. The table above provides a reconciliation of
adjusted EBITDA for each segment to net income attributable to H.B.
Fuller for each segment, the most directly comparable financial
measure determined and reported in accordance with U.S. GAAP.
NMP = Non-meaningful percentage
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands
(unaudited)
Hygiene, Health
Building
Three Months Ended:
and Consumable
Engineering
Adhesive
Corporate
H.B. Fuller
March 2, 2024
Adhesives
Adhesives
Solutions
Total
Unallocated
Consolidated
Net income attributable to H.B. Fuller
$
48,888
$
26,476
$
8,967
$
84,331
$
(53,340
)
$
30,991
Adjustments:
Acquisition project costs1
-
-
-
-
2,043
2,043
Organizational realignment2
-
-
-
-
7,262
7,262
Project One3
-
-
-
-
3,213
3,213
Discrete tax items4
-
-
-
-
(2,527
)
(2,527
)
Income tax effect on adjustments5
-
-
-
-
(3,290
)
(3,290
)
Adjusted net income attributable to H.B.
Fuller6
48,888
26,476
8,967
84,331
(46,639
)
37,692
Add:
Interest expense
-
-
-
-
31,901
31,901
Interest income
-
-
-
-
(1,307
)
(1,307
)
Adjusted Income taxes
-
-
-
-
13,631
13,631
Depreciation and amortization expense7
13,975
11,726
12,443
38,144
2,957
41,101
Adjusted EBITDA6
$
62,863
$
38,202
$
21,410
$
122,475
$
543
$
123,018
Revenue
$
368,078
$
226,075
$
179,666
$
773,819
$
36,600
$
810,419
Adjusted EBITDA Margin6
17.1
%
16.9
%
11.9
%
15.8
%
1.5
%
15.2
%
Note: Adjusted EBITDA is a non-GAAP
financial measure. The table above provides a reconciliation of
adjusted EBITDA for each segment to net income attributable to H.B.
Fuller for each segment, the most directly comparable financial
measure determined and reported in accordance with U.S. GAAP.
NMP = Non-meaningful percentage
H.B. FULLER COMPANY AND
SUBSIDIARIES
SEGMENT FINANCIAL
INFORMATION
NET REVENUE GROWTH
(DECLINE)
(unaudited)
Three Months Ended
March 1, 2025
Price
0.2
%
Volume
1.7
%
Organic Growth12
1.9
%
M&A
(1.2
)%
Constant currency
0.7
%
F/X
(3.4
)%
Total H.B. Fuller Net Revenue
(2.7
)%
Revenue growth versus 2024
Three Months Ended
March 1, 2025
Net Revenue
F/X
Constant Currency
M&A
Organic Growth12
Hygiene, Health and Consumable
Adhesives
0.0
%
(5.0
)%
5.0
%
0.8
%
4.2
%
Engineering Adhesives
4.7
%
(2.1
)%
6.8
%
8.7
%
(1.9
)%
Building Adhesive Solutions
2.2
%
(2.4
)%
4.6
%
2.4
%
2.2
%
Corporate Unallocated13
(100.0
)%
0.0
%
(100.0
)%
(100.0
)%
0.0
%
Total H.B. Fuller
(2.7
)%
(3.4
)%
0.7
%
(1.2
)%
1.9
%
12 We use the term “organic revenue” to
refer to net revenue, excluding the effect of foreign currency
changes and acquisitions and divestitures. Organic growth reflects
adjustments for the impact of period-over-period changes in foreign
currency exchange rates on revenues and the revenues associated
with acquisitions and divestitures.
13 Corporate Unallocated includes revenue
for the North America Flooring business for the three months ended
March 2, 2024. This business was sold in the first quarter of 2025
and as a result all activity for prior years was moved to Corporate
Unallocated.
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands
(unaudited)
Three Months Ended
June 1, 2024
August 31, 2024
November 30, 2024
March 1, 2025
Trailing Twelve Months Ended18
March 1, 2025
Year Ended November 30,
2024
Net income attributable to H.B. Fuller
$
51,264
$
55,361
$
(7,359
)
$
13,248
$
112,514
$
130,256
Adjustments:
Acquisition project costs1
1,467
3,474
4,051
9,828
18,820
11,035
Organizational realignment2
7,275
9,471
15,958
8,774
41,478
39,996
Project One3
2,845
3,154
2,672
3,064
11,735
11,885
Business divestiture14
-
-
47,267
-
47,267
47,267
Other15
914
(2,904
)
39
-
(1,951
)
(1,981
)
Discrete tax items16
1,317
(2,937
)
(1,322
)
992
(1,950
)
(5,469
)
Income tax effect on adjustments5
(1,558
)
(1,624
)
(9,339
)
(5,909
)
(18,430
)
(15,811
)
Adjusted net income attributable to H.B.
Fuller6
63,524
63,995
51,967
29,997
209,483
217,178
Add:
Interest expense
32,313
35,287
33,621
32,030
133,251
133,122
Interest income
(1,197
)
(1,090
)
(1,084
)
(1,100
)
(4,471
)
(4,679
)
Adjusted Income taxes
22,658
22,825
18,546
10,862
74,891
77,661
Depreciation and Amortization
expense17
39,952
44,235
45,286
42,567
172,040
170,573
Adjusted EBITDA6
$
157,250
$
165,252
$
148,336
$
114,356
$
585,194
$
593,855
14 Business divestiture for the three
months and year ended November 30, 2024 includes impairment losses
for goodwill and long-lived assets, and project costs incurred as a
direct result of the pending sale of the North America Flooring
business. Impairment losses represent the difference between the
book value of the assets held for sale and their net realizable
value.
15 Other includes a gain from insurance
recoveries and a loss from the write-off The original
source-language text of this announcement is the official,
authoritative version. Translations are provided as an
accommodation only, and should be cross-referenced with the
source-language text, which is the only version of the text
intended to have legal effect of a cost method investment for the
three months ended August 31, 2024 and the year ended November 30,
2024.
16 Discrete tax items for the three months
ended June 1, 2024 are related to various foreign tax matters as
well as excess tax benefit related to U.S. stock compensation.
Discrete tax items for the three months ended August 31, 2024 are
related to various foreign tax matters as well as excess tax
benefit related to U.S. stock compensation. Discrete tax items for
the three months ended November 30, 2024 are related to various
foreign tax matters. Discrete tax items for the three months ended
March 1, 2025 are related to various foreign tax matters. Discrete
tax items for the year ended November 30, 2024 are related to
various foreign tax matters as well as excess tax benefit related
to U.S. stock compensation.
17 Depreciation and amortization expense
added back for EBITDA is adjusted for amounts already included in
adjusted net income attributable to H.B. Fuller. Depreciation and
amortization expense added back was ($1,198) for the three months
ended June 1, 2024, $194 for the three months ended August 31,
2024, ($711) for the three months ended November 30, 2024, ($30)
for the three months ended March 1, 2025 and ($4,137) for the year
ended November 30, 2024.
18 Trailing twelve months adjusted EBITDA
is a non-GAAP financial measure and is defined as adjusted EBITDA
for the twelve-month period ended on the date presented. The table
above provides a reconciliation of trailing twelve month adjusted
EBITDA to net income attributable to H.B. Fuller for the trailing
twelve-month period presented, the most directly comparable
financial measure determined and reported in accordance with U.S.
GAAP.
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands
(unaudited)
March 1, 2025
November 30, 2024
March 2, 2024
Total debt
$
2,179,997
$
2,010,639
$
1,830,797
Less: Cash and cash equivalents
105,743
169,352
165,249
Net debt19
$
2,074,254
$
1,841,287
$
1,665,548
Trailing twelve months18 / Year ended
Adjusted EBITDA
$
585,194
$
593,855
$
594,183
Net Debt-to-Adjusted EBITDA19
3.5
3.1
2.8
19 Net debt and net debt-to-adjusted
EBITDA are non-GAAP financial measures. Net debt is defined as
total debt less cash and cash equivalents. Net debt-to-adjusted
EBITDA is defined as net debt divided by trailing twelve months
adjusted EBITDA. The calculations of these non-GAAP financial
measures are shown in the table above. The table above provides a
reconciliation of each of these non-GAAP financial measures to
total debt, the most directly comparable financial measure
determined and reported in accordance with U.S. GAAP.
H.B. FULLER COMPANY AND
SUBSIDIARIES
REGULATION G
RECONCILIATION
In thousands
(unaudited)
March 1, 2025
March 2, 2024
November 30, 2024
Trade receivables, net
$
525,496
$
525,689
$
558,336
Inventory
468,323
490,179
467,498
Trade payables
450,401
460,649
491,435
Net working capital20
$
543,418
$
555,219
$
534,399
Net revenue three months ended
$
788,663
$
810,419
Annualized net revenue20
3,154,652
3,241,676
Net working capital as a percentage of
annualized revenue20
17.2
%
17.1
%
20 Net working capital, annualized net
revenue and net working capital as a percentage of annualized net
revenue are non-GAAP financial measures. Net working capital is
defined as trade receivables, net plus inventory less trade
payables. Annualized net revenue is defined as net revenue for the
three months ended on the date presented multiplied by four. Net
working capital as a percentage of annualized net revenue is net
working capital divided by annualized net revenue. The calculations
of these non-GAAP financial measures are shown in the table above.
The table above provides a reconciliation of each of these non-GAAP
financial measures to the most directly comparable financial
measure determined and reported in accordance with U.S. GAAP.
CONSOLIDATED BALANCE
SHEETS
H.B. Fuller Company and
Subsidiaries
(In thousands, except share and
per share amounts)
March 1,
November 30,
2025
2024
Assets
Current assets:
Cash and cash equivalents
$
105,743
$
169,352
Trade receivables (net of allowances of
$10,222 and $11,621, as of March 1, 2025 and November 30, 2024,
respectively)
525,496
558,336
Inventories
468,323
467,498
Other current assets
114,588
104,019
Total current assets
1,214,150
1,299,205
Property, plant and equipment
1,794,291
1,864,558
Accumulated depreciation
(950,290
)
(982,631
)
Property, plant and equipment,
net
844,001
881,927
Goodwill
1,624,347
1,532,221
Other intangibles, net
834,515
770,226
Other assets
443,893
449,665
Total assets
$
4,960,906
$
4,933,244
Liabilities, non-controlling interest
and total equity
Current liabilities
Notes payable
$
578
$
587
Trade payables
450,401
491,435
Accrued compensation
67,271
106,005
Income taxes payable
15,986
24,225
Other accrued expenses
80,588
97,038
Total current liabilities
614,824
719,290
Long-term debt
2,179,419
2,010,052
Accrued pension liabilities
51,986
51,755
Other liabilities
336,316
322,299
Total liabilities
$
3,182,545
$
3,103,396
Commitments and contingencies
Equity
H.B. Fuller stockholders' equity:
Preferred stock (no shares outstanding)
shares authorized – 10,045,900
-
-
Common stock, par value $1.00 per share,
shares authorized – 160,000,000, shares outstanding – 54,189,853
and 54,657,103 as of March 1, 2025 and November 30, 2024,
respectively
$
54,190
$
54,657
Additional paid-in capital
285,646
322,636
Retained earnings
1,925,724
1,924,761
Accumulated other comprehensive loss
(488,421
)
(473,395
)
Total H.B. Fuller stockholders' equity
1,777,139
1,828,659
Non-controlling interest
1,222
1,189
Total equity
1,778,361
1,829,848
Total liabilities, non-controlling
interest and total equity
$
4,960,906
$
4,933,244
CONSOLIDATED STATEMENTS of
CASH FLOWS
H.B. Fuller Company and
Subsidiaries
(In thousands)
Three Months Ended
March 1, 2025
March 2, 2024
Cash flows from operating
activities:
Net income including non-controlling
interest
$
13,264
$
31,012
Adjustments to reconcile net income
including non-controlling interest to net cash provided by
operating activities:
Depreciation
21,717
23,168
Amortization
20,880
20,355
Deferred income taxes
5,837
(5,658
)
Income from equity method investments, net
of dividends received
(497
)
(1,044
)
Loss on the sale of a business
1,515
-
Gain on sale or disposal of assets
(46
)
(86
)
Share-based compensation
4,708
5,088
Change in assets and liabilities, net of
effects of acquisitions:
Trade receivables, net
13,900
56,886
Inventories
(27,122
)
(50,189
)
Other assets
(295
)
(9,064
)
Trade payables
(14,272
)
27,640
Accrued compensation
(37,913
)
(31,862
)
Other accrued expenses
(11,959
)
(12,040
)
Income taxes payable
(21,854
)
(5,121
)
Accrued / prepaid pensions
(1,988
)
(2,126
)
Other liabilities
(311
)
(399
)
Foreign currency remeasurement
(18,471
)
791
Net cash (used in) provided by
operating activities
(52,907
)
47,351
Cash flows from investing
activities:
Purchased property, plant and
equipment
(32,984
)
(43,293
)
Purchased businesses, net of cash
acquired
(162,032
)
-
Purchase of cost method investment
(2,549
)
-
Proceeds from sale of property, plant and
equipment
477
568
Proceeds from the sale of a business
75,727
-
Net cash used in investing
activities
(121,361
)
(42,725
)
Cash flows from financing
activities:
Proceeds from issuance of long-term
debt
526,300
195,000
Repayment of long-term debt
(359,535
)
(203,250
)
Net payment of notes payable
(164
)
(276
)
Dividends paid
(12,193
)
(11,151
)
Proceeds from stock options exercised
1,384
8,977
Repurchases of common stock
(44,377
)
(6,208
)
Net cash provided by (used in)
financing activities
111,415
(16,908
)
Effect of exchange rate changes on cash
and cash equivalents
(756
)
(1,922
)
Net change in cash and cash
equivalents
(63,609
)
(14,204
)
Cash and cash equivalents at beginning of
period
169,352
179,453
Cash and cash equivalents at end of
period
$
105,743
$
165,249
View source
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