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Aug 27, 2022
H.B. Fuller Q3 2022 Earnings Report
Reported net revenue growth and increased adjusted EBITDA.
Key Takeaways
H.B. Fuller reported a 13.8% increase in net revenue, driven by strong organic growth of 18.4%. Adjusted EPS increased by 34% year-on-year, and adjusted EBITDA grew by 24%, with margin expansion of 120 basis points. The company is increasing its full-year adjusted EBITDA expectations.
Net revenue grew 13.8% year-on-year, with organic revenue increasing 18.4%.
Adjusted gross margin expanded 280 basis points year-on-year.
Adjusted EBITDA increased 24.4% year-on-year, with adjusted EBITDA margin up 120 basis points.
Adjusted EPS increased 34.2% versus the prior year.
Revenue by Segment
Forward Guidance
The company is increasing full-year expectations for adjusted EBITDA to a range of $540 to $550 million. Adjusted EPS in the fourth quarter of fiscal 2022 is expected to be in the range of $1.15 to $1.30.
Positive Outlook
- Organic revenue growth for fiscal year 2022 is expected to be in the range of 17% to 18%.
- Adjusted EBITDA for fiscal year 2022 is expected to be in the range of $540 to $550 million.
- Adjusted EPS in the fourth quarter of fiscal 2022 is expected to be in the range of $1.15 to $1.30.
- Working capital, as a percentage of annualized net revenue, is expected to be in the range of 16% to 17% by fiscal year-end.
- Full-year cash flow from operations similar to the prior year.
Challenges Ahead
- Slower economic conditions
- Stronger U.S. Dollar
- Continued raw material cost inflation
- Net interest expense for fiscal 2022 is expected to be between $80 and $85 million reflecting higher interest rates
Historical Earnings Impact
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Avg. Return Before/After Earnings
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