H.B. Fuller Q1 net revenue of $647 million decreased 3.9%Christian Fernsby ▼ | March 26, 2020
H.B. Fuller Company reported financial results for the first quarter ended Feb. 29, 2020.
H.B. Fuller Organic revenue was down 1.3%
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Foreign currency exchange rates and the sale of the surfactants, thickeners and dispersants business negatively impacted revenues by 2.6% on a combined basis.
Organic revenue, which excludes impacts from foreign currency and divestitures, was down 1.3% versus last year.
Organic revenue growth in Construction Adhesives (CA) partially offset a decline in Engineering Adhesives (EA) and flat revenues in Hygiene, Health and Consumables Adhesives (HHC.) The decline in organic revenue was driven by an impact on sales resulting from the coronavirus pandemic.
The company estimates the shutdown in China following the outbreak impacted sales in region by approximately $15 million in the quarter, including an estimated $12 million in Engineering Adhesives and an estimated $3 million in HHC.
Excluding this impact, volumes would have increased versus last year in all segments.
Gross profit margin was 26.3%.
Adjusted gross profit margin of 26.5% was down 50 basis points versus last year.
The decline was due to lower revenues and unfavorable product mix related to impacts from COVID-19 and was partially offset by favorable raw material costs.
Selling, General and Administrative (SG&A) expense was $142 million.
Adjusted SG&A expense of $135 million declined by 3% compared with the same period last year, driven by cost savings realized from the company's business realignment to three global business units.
As a result of these factors, net income attributable to H.B.
Fuller in the quarter was $10 million, or $0.19 per diluted share.
Adjusted net income attributable to H.B.
Fuller was $18 million, or $0.34 of adjusted EPS, consistent with $18 million, or $0.34 of adjusted EPS in the prior year.
Adjusted EBITDA was $78 million in the quarter, compared with $83 million in the same period last year, and adjusted EBITDA margin was 12.0% versus 12.3% in the prior year.
The company estimates that COVID-19 impacted adjusted EPS and adjusted EBITDA by approximately $0.06, and $4.5 million, respectively, versus last year. ■