Ecolab Inc. ECL reported first-quarter 2025 adjusted earnings per share (EPS) of $1.50, up 11.9% year over year. The bottom line remained in line with the Zacks Consensus Estimate. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
GAAP EPS for the quarter was $1.41, down 1.4% year over year.
ECL’s Revenue Details
Revenues grossed $3.69 billion in the reported quarter, down 1.5% year over year. The metric missed the Zacks Consensus Estimate by 0.3%.
Ecolab’s organic sales were $3.63 billion, up 3.1% from the prior-year period’s level.
The year-over-year uptick in the first-quarter organic sales was driven by accelerated growth in the Industrial and Healthcare & Life Sciences segments and continued strong growth in the Pest Elimination and Institutional & Specialty segments.
Shares of this company gained nearly 3.8% in today’s pre-market trading.
Ecolab’s Segmental Analysis
Per management, effective in the first quarter of 2025, Ecolab modified its segment reporting. Ecolab’s Global Industrial segment is renamed Global Water and includes Light & Heavy (previously named Water), Food & Beverage, and Paper. The company’s healthcare business has moved into Institutional. Global Life Sciences was elevated to a standalone segment. The Global Pest Elimination segment remains a standalone segment.
The Global Water’s fixed currency sales of $1.80 billion reflect 2.6% reported growth year over year. Organic sales were $1.78 billion, up 2.1% year over year, as growth improved across Water, Food & Beverage, and Paper.Water’s improved growth was led by continued strong growth in downstream and light water. Improved Food & Beverage sales reflected good new business wins, which benefited from ECL’s One Ecolab enterprise selling approach.
The Global Institutional & Specialty arm’s fixed currency sales and organic sales were $1.41 billion each, reflecting a decline of 2.8% year over year on a reported basis and growth of 3.7% on an organic basis. Per management, Specialty saw strong underlying growth, partly offset by the planned exit of low-margin, non-strategic businesses. Both Institutional and Specialty achieved solid new business wins and strong value pricing, outperforming market trends. The company witnessed organic growth in the legacy Institutional business and a slight decline in healthcare sales.
The Global Pest Elimination segment’s fixed currency sales of $278.1 million improved 6.8% year over year on a reported basis. Organic sales were $273.7 million, up 5.1% year over year. Organic sales growth was driven by strong gains in food & beverage, restaurants, and hospitality, offsetting softer results in food retail. Notably, Pest’s safety performance improved, returning to Ecolab’s world-class standards.
The Global Life Sciences segment’s fixed currency sales of $167 million improved 4.8% year over year on a reported basis and on an organic basis.
Ecolab Inc. Price, Consensus and EPS Surprise
Ecolab Inc. Price, Consensus and EPS Surprise
Ecolab Inc. price-consensus-eps-surprise-chart | Ecolab Inc. Quote
ECL’s Margin Analysis
In the quarter under review, Ecolab’s gross profit improved 0.7% year over year to $1.63 billion. The gross margin contracted 90 basis points (bps) to 44.2%.
Selling, general and administrative expenses declined 2.6% to $1.05 billion year over year.
Adjusted operating profit totaled $589.6 million, increasing 7.7% from the prior-year quarter’s level. Adjusted operating margin in the quarter also expanded 160 bps to 15.9%.
Ecolab’s Financial Position
Ecolab exited the first quarter of 2025 with cash and cash equivalents of $1.16 billion compared with $1.26 billion at the end of 2024. Total debt at the end of the first quarter of 2025 was $7.61 billion compared with $7.56 billion at 2024-end.
Meanwhile, Ecolab has a consistent dividend-paying history, with a five-year annualized dividend growth of 5.67%.
ECL’s Guidance
Ecolab has provided its adjusted EPS outlook for the second quarter of 2025 and reiterated its outlook for the full year.
The company expects its adjusted EPS for the second quarter in the range of $1.84-$1.94, up 10-15% from the year-ago period. The Zacks Consensus Estimate is currently pegged at $1.90.
For 2025, Ecolab continues to expect its adjusted EPS in the range of $7.42-$7.62 (reflecting an uptick of 12-15% from the comparable 2024 period). The Zacks Consensus Estimate is currently pegged at $7.51 per share.
Our Take
Ecolab exited the first quarter of 2025 with mixed results. Earnings remained in line with the consensus estimate, and revenues missed the same. However, the company registered a robust year-over-year uptick in its organic sales and bottom line, along with solid performances across most of its segments. The expansion of operating margin bodes well for the stock.
Per management, growth in the United States (ECL’s largest and most profitable region) continued to be strong and growth across the rest of the world was also solid as the company was able to offset uneven macroeconomic trends. This looked promising for the stock.
However, the decline in Ecolab’s Global Institutional & Specialty arm’s reported revenues was disappointing.
Ecolab’s Zacks Rank and Key Picks
Ecolab currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the same medical industry are Fresenius Medical Care FMS, Masimo MASI and Glaukos GKOS.
Fresenius Medical, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 28.9% for 2025. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
FMS’ earnings beat estimates in three of the trailing four quarters and met in one, delivering an average surprise of 15.67%. The company is expected to release first-quarter results next month.
FMS’ shares have gained 6% so far this year.
Masimo, carrying a Zacks Rank of 2 at present, has an estimated growth rate of 20% for 2025.
MASI’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 14.41%. The company is expected to release first-quarter results in May.
MASI’s shares have lost 8% so far this year.
Glaukos, carrying a Zacks Rank #2 at present, has an estimated earnings growth rate of 48.9% for 2025. It delivered a trailing four-quarter average earnings surprise of 8.11%. The company’s earnings beat estimates in two of the trailing four quarters, met in one and missed in the other, delivering an average surprise of 8.11%. The company is expected to release first-quarter results on April 30.
GKOS’ shares have plunged 40.1% so far this year.
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