H.B. Fuller Reports Decrease in Revenue and Net Income for Q2 and First Half of Fiscal 2025

H.B. Fuller Company reported a decrease in financial performance for the second quarter and first half of fiscal 2025, as detailed in its latest 10-Q filing. For the three months ended May 31, 2025, the company recorded net revenue of $898.1 million, a decline of 2.1% compared to $917.1 million in the same period last year. Net income attributable to H.B. Fuller was $41.8 million, down from $51.3 million, resulting in diluted earnings per share of $0.76, compared to $0.91 in the prior year. For the first six months, net revenue decreased by 2.4% to $1.686 billion, with net income falling to $55.1 million from $82.3 million.

The decline in revenue was attributed to several factors, including a 1.3% decrease from acquisitions and divestitures, a 1.2% negative impact from currency fluctuations, and a 0.3% decrease in sales volume. However, there was a slight offset from a 0.7% increase in pricing. The company noted that the negative currency effects were primarily driven by weaker currencies in Brazil, Mexico, Egypt, and Turkey against the U.S. dollar. Despite these challenges, gross profit margins improved, increasing by 110 basis points in the second quarter due to the impact of acquisitions and divestitures.

Strategically, H.B. Fuller has been active in expanding its portfolio through acquisitions. In early 2025, the company acquired ND Industries Asia, Inc. for approximately $8.2 million, which is expected to enhance its growth in the Greater Asia region. Additionally, the company completed the acquisitions of GEM S.r.l. and Medifill Limited for a total of approximately $197.3 million, aimed at bolstering its medical adhesives segment in Europe. These acquisitions are part of a broader strategy to focus on high-margin, high-growth market segments.

Operationally, H.B. Fuller has undergone significant restructuring, with plans to optimize operations and integrate acquired businesses. The company expects to incur restructuring costs of approximately $70 million to $75 million, with $66.3 million already spent as of May 31, 2025. The restructuring is anticipated to be completed by fiscal year 2026. The company also reported a decrease in employee headcount as part of these restructuring efforts, although specific numbers were not disclosed.

Looking ahead, H.B. Fuller remains focused on leveraging its acquisitions and restructuring initiatives to drive future growth. The company anticipates that cash flows from operating activities will be sufficient to meet its liquidity needs, and it plans to continue investing in high-growth areas while managing its debt levels. The outlook reflects a cautious optimism as the company navigates market challenges and capitalizes on strategic opportunities.