HB Fuller Company Reports Third Quarter 2024 Financial Results
Intellectia.AI2024-09-26
H.B. Fuller Company Reports Third Quarter 2024 Financial Results
H.B. Fuller Company (NYSE:FUL) announced its financial results for the third quarter ending August 31, 2024.
Key Financial Metrics:
| Metric | Q3 2024 | Q3 2023 YoY Change | Consensus Estimates | Beat/Miss vs Estimates |
|---|---|---|---|---|
| Net Revenue | $918 million | +1.9% | $944.25 million | Miss |
| Reported EPS (Diluted) | $0.98 | NA | $1.23 | Miss |
| Adjusted EPS (Diluted) | $1.13 | +7% | $1.23 | Miss |
The company's financial performance in the third quarter showed modest growth in key areas. Adjusted earnings per share (EPS) increased 7% year-over-year to $1.13, though it missed consensus estimates. Total revenues for the quarter stood at $918 million with a slight year-over-year increase of 1.9%, which also fell short of market expectations.
Segment Performance:
| Segment | Revenue Change |
|---|---|
| Organic Volume | +3.0% |
| Pricing Adjustments Impact | -2.6% |
| Foreign Currency Translation | -1.5% |
| Acquisitions | +3.0% |
H.B. Fuller's revenue growth was primarily driven by organic volume increases and recent acquisitions, despite a negative impact from foreign currency exchanges and pricing adjustments.
Key Developments and Operational Highlights:
- Net income was $55 million, with an adjusted EBITDA of $165 million, reflecting a year-on-year increase of 6%.
- Gross profit margin rose to 30.0%, and adjusted gross profit margin improved to 30.4%, strengthening by 40 basis points.
- The acquisition of HS Butyl Limited expanded the company's presence in the global waterproofing tape market.
- 407,400 shares repurchased year-to-date with 225,000 of those shares repurchased in the quarter.
Executive Comments:
H.B. Fuller President and CEO Celeste Mastin commented on the steady progress in executing the company's strategic initiatives, even amidst a challenging macroeconomic landscape. Mastin noted that while volume growth was below expectations due to slowed demand in certain durable goods markets in EA, the company remains committed to its long-term targets and confident in its focused strategy and engaged team.
Forward Guidance:
H.B. Fuller updated its financial guidance for fiscal 2024, projecting net revenue growth to remain relatively stable, with adjusted EBITDA anticipated between $610 million and $620 million, and adjusted EPS forecasted between $4.10 and $4.20. Operating cash flow is expected to be between $325 million and $350 million.
Stock Price Movement:
Following the earnings release, H.B. Fuller's stock observed a significant drop of approximately 11.25%.
This report reflects the company's efforts to maintain and grow its business through strategic acquisitions and operational improvements, while navigating through adverse currency effects and market dynamics.
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