H.B. Fuller Company (NYSE:FUL) stock fell 2.92% (As on January 16, 11:20:24 AM UTC-4, Source: Google Finance) after the company reported fourth quarter earnings that fell short of analyst expectations. Organic revenue declined 0.2% year-on-year, with pricing adjustments reducing organic revenue by 1.5% and volume increasing organic revenue by 1.3%. Foreign currency translation decreased net revenue by 0.2%, and acquisitions increased net revenue by 2.7%. Adjusted gross profit was $273 million. Adjusted gross profit margin of 29.6% decreased 170 basis points year-on-year. Unfavorable pricing in conjunction with higher raw material costs, principally led to the decline in adjusted gross margin year-on-year. Adjusted net income attributable to H.B. Fuller for the fourth quarter of fiscal 2024 was $52 million. Adjusted EBITDA in the fourth quarter of fiscal 2024 was $148 million, down 14% year-on-year, driven by unfavorable raw material cost developments, delayed price realization, and higher variable compensation expense. Net debt at the end of the fourth quarter of fiscal 2024 was $1,841 million, down $48 million sequentially versus the third quarter and up $182 million year-on-year. Net debt-to-adjusted EBITDA of 3.1X was flat versus the previous quarter. Net working capital in the fourth quarter of fiscal 2024 declined $56 million sequentially versus the third quarter and $46 million year-on-year.
FUL in the fourth quarter of FY 24 has reported the adjusted earnings per share of 92 cents, missing the analysts’ estimates for the adjusted earnings per share of $1.23. The company had reported the adjusted revenue growth of 2.3 percent to $923 million in the fourth quarter of FY 24, missing the analysts’ estimates for revenue of $945.32 million.
Looking ahead, H.B. Fuller provided a disappointing outlook for fiscal 2025. The company expects earnings per share between $3.90 and $4.20, compared to the $4.14 consensus. Net revenue growth is projected to decline 2% to 4% year-over-year, or increase 1% to 2% when adjusting for the divestiture of its Flooring business.
The company said it is finalizing plans to streamline its manufacturing and supply chain footprint, aiming to generate approximately $75 million in annualized cost savings by fiscal 2030. H.B. Fuller expects to invest around $150 million in incremental capital over the next five years to implement these changes.
For the first quarter of fiscal 2025, H.B. Fuller forecasts adjusted EBITDA between $105 million and $115 million. The company projects full-year adjusted EBITDA of $600 million to $625 million, representing growth of 1% to 5% compared to fiscal 2024.