In This Article:
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Revenue: Up 2.3% year-on-year; organic revenue down 0.2% due to lower pricing.
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Volume: Increased 1.3% year-on-year.
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Adjusted EBITDA: $148 million, down 14% year-on-year; margin declined to 16.1%.
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Adjusted Gross Profit Margin: 29.6%, down 170 basis points year-on-year.
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Adjusted Earnings Per Share (EPS): $0.92, down from the previous year.
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Cash Flow from Operations: $301 million for the full year, down year-on-year.
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Net Debt-to-EBITDA Ratio: 3.1 times, flat versus the end of Q3.
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HHC Segment: Organic revenue down 2.2% year-on-year; adjusted EBITDA margin decreased to 13.9%.
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Engineering Adhesives (EA): Organic revenue decreased 1.9%; adjusted EBITDA margin at 19.7%.
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Construction Adhesives (CA): Organic sales increased 10.5%; adjusted EBITDA margin at 12.3%.
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2025 Guidance: Full year net revenue expected to be down 2% to 4%; adjusted EBITDA between $600 million and $625 million.
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Capital Expenditures: Approximately $160 million expected for 2025.
Release Date: January 16, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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H.B. Fuller Co (NYSE:FUL) achieved a record adjusted EBITDA margin of 16.6% for the fiscal year 2024, indicating strong operational performance.
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The company made significant progress in reducing net working capital requirements and maintaining a stable leverage ratio.
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Strategic acquisitions, such as GEM Srl and Medifill Ltd, are expected to enhance market presence in the medical adhesives sector.
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The Construction Adhesives segment showed strong performance with a 10.5% year-on-year increase in organic sales, driven by roofing growth.
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H.B. Fuller Co (NYSE:FUL) plans to reduce its global manufacturing footprint, which is expected to generate approximately $75 million in annualized cost savings once complete.
Negative Points
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The fourth quarter saw an unexpected deceleration in volume across most end markets, impacting overall performance.
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Organic sales were down slightly in the fourth quarter, reflecting a weakening economic backdrop.
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Adjusted EBITDA in the fourth quarter was down 14% year-on-year, with a decline in adjusted EBITDA margin to 16.1%.
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The HHC segment experienced a marked slowdown in volume growth and negative pricing year-on-year.
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The company faced higher raw material costs and delayed pricing actions, leading to margin pressure.
Q & A Highlights
Q: Can you speak to the cash cost to implement the restructuring plan and the flow-through of expected savings? A: Celeste Mastin, CEO: The plan is aggressive but achievable. We have a global footprint with redundancies and opportunities for growth. We plan to reduce facilities from 82 to 55 by 2030, with 16 reductions by the end of 2025. John Corkrean, CFO: Savings should be roughly $5 million in 2025, stepping up to $20 million in 2026, reaching a $75 million run rate. The cost to implement is estimated between $25 million and $50 million, with capital costs of $150 million over five years.