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H.B. Fuller beats estimates amid subdued economic outlook
H.B. Fuller Company -4.86%
Dow Jones Industrial Average -1.04%
S&P 500 index -0.89%
NASDAQ -1.04%
H.B. Fuller Company FUL | 49.52 | -4.86% |
Dow Jones Industrial Average DJI | 45744.95 | -1.04% |
S&P 500 index SPX | 6565.71 | -0.89% |
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H.B. Fuller Co. has reported fiscal third-quarter net income up 21.3% year over year to $67.2 million on net revenue down 2.8% to $892.0 million, as per Chemweek.
Adjusted earnings rose 12% to $1.26 per share, slightly ahead of analysts’ consensus estimate of $1.24 per share, as reported by S&P Capital IQ. Selling prices rose by 1.0%, driving expanded margins, but volumes and organic revenues were lower.
The company also tightened its full-year outlook due to difficult economic conditions. “We remain cautious and have tightened our guidance range for the year to reflect a globally subdued economic backdrop,” said Fuller President and CEO Celeste Mastin. “Looking forward, we expect volume growth to remain elusive and end-market conditions to be challenging.”
Fuller expects full-year fiscal 2025 adjusted EBITDA to total $615 million-$625 million, up 4%-5% year over year from a forecast of $615 million-$630 million previously. Net revenue is still expected to be down by 2%-3%. Organic revenue is expected to be flat to up 1%, down from a prior forecast of flat to up 2%.The reduced guidance reflects widespread pessimism about the economic outlook. While purchasing managers indices (PMIs) have improved slightly in recent months, “worldwide business confidence in the year-ahead outlook deteriorated to one of the gloomiest since the pandemic” in July, according to S&P Global Market Intelligence.A large increase in S&P Global’s US manufacturing PMI for August was mostly due to inventory building, a response to uncertainty, said Chris Williamson, chief business economist at Market Intelligence.Meanwhile, Fuller’s segment results were mixed. Hygiene, health and consumable adhesives segment net revenue fell 1.0% year over year to $386.1 million, while segment operating income was down 4.5% to $46.5 million. Engineering adhesives segment net revenue rose 4.7% to $272.3 million, while segment operating income was up 17.0% to $46.9 million. Building adhesives segment net revenue increased 2.3% to $233.7 million, while segment operating income was roughly flat at $25.9 million. Fuller’s fiscal third-quarter ended Aug. 30.
mrchub.com
Adjusted earnings rose 12% to $1.26 per share, slightly ahead of analysts’ consensus estimate of $1.24 per share, as reported by S&P Capital IQ. Selling prices rose by 1.0%, driving expanded margins, but volumes and organic revenues were lower.
The company also tightened its full-year outlook due to difficult economic conditions. “We remain cautious and have tightened our guidance range for the year to reflect a globally subdued economic backdrop,” said Fuller President and CEO Celeste Mastin. “Looking forward, we expect volume growth to remain elusive and end-market conditions to be challenging.”
Fuller expects full-year fiscal 2025 adjusted EBITDA to total $615 million-$625 million, up 4%-5% year over year from a forecast of $615 million-$630 million previously. Net revenue is still expected to be down by 2%-3%. Organic revenue is expected to be flat to up 1%, down from a prior forecast of flat to up 2%.The reduced guidance reflects widespread pessimism about the economic outlook. While purchasing managers indices (PMIs) have improved slightly in recent months, “worldwide business confidence in the year-ahead outlook deteriorated to one of the gloomiest since the pandemic” in July, according to S&P Global Market Intelligence.A large increase in S&P Global’s US manufacturing PMI for August was mostly due to inventory building, a response to uncertainty, said Chris Williamson, chief business economist at Market Intelligence.Meanwhile, Fuller’s segment results were mixed. Hygiene, health and consumable adhesives segment net revenue fell 1.0% year over year to $386.1 million, while segment operating income was down 4.5% to $46.5 million. Engineering adhesives segment net revenue rose 4.7% to $272.3 million, while segment operating income was up 17.0% to $46.9 million. Building adhesives segment net revenue increased 2.3% to $233.7 million, while segment operating income was roughly flat at $25.9 million. Fuller’s fiscal third-quarter ended Aug. 30.
mrchub.com
