H.B. Fuller reports positive fourth quarter

St. Paul, MN – H.B. Fuller Company reported financial results for its fourth quarter and fiscal year that ended November 30, 2024.

The Company’s net revenue for the fourth quarter of fiscal 2024 was $923 million, up 2.3% versus the fourth quarter of fiscal 2023. 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%.

Gross profit in the fourth quarter of fiscal 2024 was $265 million. 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.
Selling, general and administrative (SG&A) expense was $188 million in the fourth quarter of fiscal 2024 and adjusted SG&A was $174 million, up 12 percent year-on-year. The impact of acquisitions and higher variable compensation drove most of the year-on-year increase in adjusted SG&A.
Net income/(loss) attributable to H.B. Fuller for the fourth quarter of fiscal 2024 was ($7) million, including an unfavorable $38 million non-cash, after-tax impact related to the Flooring divestiture. Adjusted net income attributable to H.B. Fuller for the fourth quarter of fiscal 2024 was $52 million. Adjusted EPS was $0.92 per diluted share.

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.

“Overall, I am proud of the progress we made in fiscal year 2024. We continued to expand adjusted EBITDA margin and enhanced the profile of our portfolio through several strategic acquisitions and the divestiture of our Flooring business,” said Celeste Mastin, President and Chief Executive Officer. “At the same time, I am disappointed that we were unable to finish the year as strong as we had expected. In the fourth quarter, we encountered an unexpected deceleration in volume across the majority of our end markets. Furthermore, delays in customer order patterns, particularly in the consumer product goods related market segments, shifted price increase realization into fiscal 2025, delaying the offset of higher raw material costs and resulting in margin deterioration.

“We are intensely focused on what we can control and have already begun executing additional pricing actions and cost controls to prudently prepare for a challenging volume growth environment in 2025. Our strategic plan to continue to evolve H.B Fuller into a higher growth, higher margin company remains on track on the timeline we originally communicated.”

The Company is finalizing an expanded plan to significantly reduce its global manufacturing footprint and streamline its North American planning and logistics structure. This multi-year plan is expected to reduce the number of manufacturing facilities from 82 today to a target of 55 when completed in 2030. Additionally, it will reduce the number of warehouses in North America from 55 today to approximately 10 by the end of 2027.
As a result of these combined actions, the Company expects to generate approximately $75 million in annualized cost savings once the plan is fully implemented in fiscal 2030. These figures are incremental to the ongoing restructuring actions, which are still expected to generate annualized cost savings of $45 million by the end of fiscal 2025. The Company expects to invest approximately $150 million in incremental capital over the next five years associated with the expanded plan.
“Our manufacturing footprint consolidation, coupled with our planning and logistics reorganization, are important steps in our strategic plan to achieve an EBITDA margin consistently greater than 20 percent. These actions will not only reduce costs through improved capacity utilization, they will also enable us to better serve our customers and reduce future capital expenditure requirements,” said Mastin.