H.B. Fuller Reports First Quarter Fiscal 2021 Results

Rhea-AI Summary

H.B. Fuller Company (NYSE: FUL) reported a 12.3% increase in net revenue for Q1 2021, totaling $726 million, aided by strong operational execution and a 10.5% rise in organic revenue. Adjusted EBITDA reached $101 million, up 30% year-over-year, with adjusted EPS nearly doubling to $0.66. The company paid down approximately $16 million in debt and anticipates further reductions alongside a projected revenue growth of high-single digit to low double-digit for the year. Challenges include rising raw material costs, with expected increases of 5% to 8% for the full year.

Positive

• Net revenue increased by 12.3% YoY to $726 million.
• Adjusted EBITDA rose 30% YoY to $101 million.
• Adjusted EPS nearly doubled to $0.66.
• Debt paydown of approximately $16 million achieved in Q1.

Negative

• Raw material costs expected to rise by 5% to 8% for the full year.

H.B. Fuller Company (NYSE: FUL) today reported financial results for the first quarter ended Feb. 27, 2021.

Items of Note for First Quarter 2021

• Significant revenue and earnings growth versus the first quarter of fiscal 2020 was driven by strong operational execution, higher sales, and benefits from restructuring efficiencies.
• Net revenue increased 12.3% versus last year. Organic revenue increased 10.5%, driven by 21% organic growth in Engineering Adhesives segment sales.
• Strong sales growth and restructuring efficiencies resulted in net income of $30 million; adjusted EBITDA of $101 million increased 30% year over year.
• Earnings per diluted share (EPS) were $0.56; adjusted EPS of $0.66 nearly doubled versus the prior year quarter.
• Debt paydown in the first quarter was approximately $16 million, compared with $6 million in the prior year quarter, and is on track to the company’s $200 million debt paydown target for the year.

Summary of First Quarter 2021 Results

Net revenue of $726 million increased 12.3% compared with the first quarter of 2020. Foreign currency exchange rates favorably impacted revenue by 1.8%. Organic revenue, which excludes impacts from foreign currency translation, increased 10.5% versus last year. Strong sales growth in Engineering Adhesives and Hygiene, Health and Consumable Adhesives offset effects of slower commercial construction and extreme weather on Construction Adhesives revenues.

Gross profit margin was 26.5%. Adjusted gross profit margin of 26.7% increased 20 basis points versus last year on higher sales volume. Selling, General and Administrative (SG&A) expense was $144 million. Adjusted SG&A expense of $138 million was down 170 basis points as a percent of revenue versus the first quarter last year, driven by savings related to the business reorganization to our three Global Business Units (GBUs) and lower travel expense.

As a result of these factors, net income attributable to H.B. Fuller in the quarter was $30 million, or $0.56 per diluted share. Adjusted net income attributable to H.B. Fuller of $35 million and adjusted EPS of $0.66 nearly doubled compared with $18 million and $0.34, respectively, in the same period last year. Adjusted EBITDA of $101 million increased 30% compared with $78 million in the prior year, and adjusted EBITDA margin of 13.9% improved 190 basis points versus last year.

The company reported in March of 2020 that the emergence of the COVID-19 pandemic in China in early 2020 negatively impacted its first quarter 2020 business results by an estimated $15 million of revenue, $4.5 million of EBITDA, and $0.06 of EPS, in the comparable period last year.

“Leveraging the momentum we created throughout 2020, the H.B. Fuller team delivered exceptional financial performance of 30% growth in EBITDA in the first quarter of fiscal 2021,” said Jim Owens, H.B. Fuller president and chief executive officer. “It is clear that our diversified business model, coupled with a global focus on operational agility and market-driven innovation, are competitive advantages for H.B. Fuller in the adhesives industry, especially in a changing world. In 2021, we will focus on continuing to grow our business profitably by innovating and supporting our customers’ success in the current, high-demand and supply-constrained environment. H.B. Fuller has done a remarkable job in supporting customers through effective sourcing strategies and supply chain management. In the second quarter, we have implemented significant price adjustments which will enable us to continue to seamlessly serve our customers. In addition, our team is working to release additional capacity for growth through our operational excellence programs and to achieve an additional $200 million of debt reduction in 2021.”

Key Balance Sheet and Cash Flow Items

At the end of the first quarter of fiscal 2021, the company had cash on hand of $81 million and total debt equal to $1,758 million. This compares to cash and debt levels equal to $79 million and $1,973 million, respectively, at the end of the first quarter of 2020. Cash flow from operations for the first quarter was $36 million, up from $34 million in the same period last year, driven by strong income growth partly offset by higher working capital due to increased sales. Capital expenditures in the first quarter were $35 million compared with $32 million in the same period last year.

2021 Planning Assumptions

H.B. Fuller has updated its planning assumptions for fiscal year 2021 based on current market conditions:

• Raw material costs are expected to rise as the year progresses driven by increasing industrial demand and supply constraints of U.S. petrochemicals resulting from severe winter weather in the Gulf Coast in February. The company expects full year raw material costs to increase 5% to 8% versus 2020. H.B. Fuller has implemented annualized price adjustments of more than $100 million that are effective in the second quarter which are anticipated to offset raw material increases. The company is prepared to implement further increases in the third quarter, as necessary.
• Based on current conditions, the company anticipates high-single digit to low double-digit revenue growth, and adjusted EBITDA in the range of $455 to $475 million for fiscal 2021. This reflects adjusted EBTIDA growth of 12% to 17% versus 2020, which is supported by share gains, on-going recovery in global industrial production, pricing actions balancing higher input costs, and benefits from the company’s operational improvement projects.
• Income growth and working capital improvement will enable the company to continue to drive strong cash flow and pay down an additional $200 million of debt in 2021, after dividends and approximately $95 million of capital investments.
• The company’s core tax rate, excluding the impact of discrete items, is anticipated to be between 26% and 29%, and full year net interest expense is estimated to be approximately $70 million.

Conference Call

The Company will host an investor conference call to discuss fourth quarter results on Thursday, March 25, 2021, at 12:30 p.m. EDT. The conference call will be available to interested parties via a webcast, and may be accessed from the company's website at https://investors.hbfuller.com. Participants should access the webcast prior to the start of the call to register for the event and install and test any necessary software. The webcast and presentation will be archived on the Company’s website. A telephone replay of the conference call will be available from approximately 3:30 p.m. EDT on March 25, 2021 through 11:59 p.m. EDT on April 1, 2021. To access the telephone replay dial (800) 585-8367 or (416) 621-4642 and enter Conference ID: 5378986.

Regulation G

The information presented in this earnings release regarding segment operating income, adjusted gross profit, adjusted gross profit margin, adjusted selling, general and administrative expense, adjusted income before income taxes and income from equity investments, adjusted income taxes, adjusted effective tax rate, adjusted net income, adjusted diluted earnings per share and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) does not conform to generally accepted accounting principles (GAAP) and should not be construed as an alternative to the reported results determined in accordance with GAAP. Management has included this non-GAAP information to assist in understanding the operating performance of the company and its operating segments as well as the comparability of results to the results of other companies. The non-GAAP information provided may not be consistent with the methodologies used by other companies. All non-GAAP information is reconciled with reported GAAP results in the “Regulation G Reconciliation” tables in this press release with the exception of our forward-looking non-GAAP measures contained above in our fiscal 2021 Planning Assumptions, which the company cannot reconcile to forward-looking GAAP results without unreasonable effort.

About H.B. Fuller

Since 1887, H.B. Fuller has been a leading global adhesives provider focusing on perfecting adhesives, sealants and other specialty chemical products to improve products and lives. With fiscal 2020 net revenue of $2.8 billion, H.B. Fuller’s commitment to innovation brings together people, products and processes that answer and solve some of the world's biggest challenges. Our reliable, responsive service creates lasting, rewarding connections with customers in electronics, disposable hygiene, medical, transportation, aerospace, clean energy, packaging, construction, woodworking, general industries and other consumer businesses. And, our promise to our people connects them with opportunities to innovate and thrive. For more information, visit us at https://www.hbfuller.com/.

Safe Harbor for Forward-Looking Statements

Certain statements in this press release may be considered forward-looking statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements often address expected future business and financial performance, financial condition, and other matters, and often contain words or phrases such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “opportunity,” “outlook,” “plan,” “project,” “seek,” “should,” “strategy,” "target," “will,” “will be,” “will continue,” “will likely result,” “would” and similar expressions, and variations or negatives of these words or phrases. These statements are subject to various risks and uncertainties that could cause our actual results to differ materially from those in the forward-looking statements, including but not limited to the following: the consequences of the COVID-19 outbreak and other pandemics on our operations and financial results; the substantial amount of debt we have incurred to finance our acquisition of Royal, our ability to repay or refinance our debt or to incur additional debt in the future, our need for a significant amount of cash to service and repay the debt and to pay dividends on our common stock, the effect of debt covenants that limit the discretion of management in operating the business or in paying dividends; our ability to pay dividends and to pursue growth opportunities if we continue to pay dividends according to the current dividend policy; our ability to achieve expected synergies, cost savings and operating efficiencies from our restructuring initiatives and operational improvement projects within the expected time frames or at all; our ability to effectively implement Project ONE; uncertain political and economic conditions; fluctuations in product demand; competing products and pricing; our geographic and product mix; availability and price of raw materials; disruptions to our relationships with our major customers and suppliers; failures in our information technology systems; regulatory compliance across our global footprint; trade policies and economic sanctions impacting our markets; changes in tax laws and tariffs; devaluations and other foreign exchange rate fluctuations; the impact of litigation and investigations, including for product liability and environmental matters; impairment charges on our goodwill or long-lived assets; the effect of new accounting pronouncements and accounting charges and credits; and similar matters. Many of the foregoing risks and uncertainties are, and will be, exacerbated by COVID-19 and resulting deterioration of the global business and economic environment.

Additional information about these various risks and uncertainties can be found in the “Risk Factors” section of our Form 10-K filings, and any updates to the risk factors in our Form 10-Q and 8-K filings with the SEC, but there may be other risks and uncertainties that we are unable to identify at this time or that we do not currently expect to have a material impact on the business. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. We do not undertake to update or revise any forward-looking statements, except as required by law.

H.B. FULLER COMPANY AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

In thousands, except per share amounts (unaudited)

		13 Weeks Ended				Percent of				13 Weeks Ended				Percent of
		February 27, 2021				Net Revenue				February 29, 2020				Net Revenue
Net revenue		$	725,904				100.0	%		$	646,564				100.0	%
Cost of sales			(533,540	)			(73.5	)%			(476,302	)			(73.7	)%
Gross profit			192,364				26.5	%			170,262				26.3	%
Selling, general and administrative expenses			(144,014	)			(19.8	)%			(141,509	)			(21.9	)%
Other income, net			7,869				1.1	%			4,969				0.8	%
Interest expense			(20,361	)			(2.8	)%			(22,757	)			(3.5	)%
Interest income			2,659				0.4	%			2,918				0.5	%
Income before income taxes and income from equity method investments			38,517				5.3	%			13,883				2.1	%
Income taxes			(10,607	)			(1.5	)%			(5,611	)			(0.9	)%
Income from equity method investments			1,896				0.3	%			1,634				0.3	%
Net income including non-controlling interest			29,806				4.1	%			9,906				1.5	%
Net income attributable to non-controlling interest			(15	)			(0.0	)%			(11	)			(0.0	)%
Net income attributable to H.B. Fuller		$	29,791				4.1	%		$	9,895				1.5	%
Basic income per common share attributable to H.B. Fuller		$	0.57							$	0.19
Diluted income per common share attributable to H.B. Fuller		$	0.56							$	0.19
Weighted-average common shares outstanding:
Basic			52,492								51,295
Diluted			53,339								52,580
Dividends declared per common share		$	0.163							$	0.160

Selected Balance Sheet Information (subject to change prior to filing of the Company's Annual Report on Form 10-K)

		February 27, 2021				November 28, 2020				February 29, 2020
Cash & cash equivalents		$	81,192			$	100,534			$	78,738
Trade accounts receivable, net			504,994				514,916				457,826
Inventories			388,773				323,213				380,975
Trade payables			373,604				316,460				333,749
Total assets			4,113,750				4,036,704				4,025,266
Total debt			1,758,216				1,773,910				1,973,472

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands, except per share amounts (unaudited)

		13 Weeks Ended
		February 27,				February 29,
		2021				2020
Net income attributable to H.B. Fuller		$	29,791			$	9,895
Adjustments:
Acquisition project costs			53				268
Organizational realignment			2,622				3,604
Royal restructuring and integration			924				3,750
Tax reform			-				(44	)
Project One			1,590				1,727
Other			75				(1,410	)
Adjusted net income attributable to H.B. Fuller 1			35,055				17,790
Add:
Interest expense			20,392				22,761
Interest income			(2,659	)			(2,918	)
Income taxes			12,583				5,592
Depreciation and Amortization expense 2			35,502				34,552
Adjusted EBITDA 1			100,873				77,777
Diluted Shares			53,339				52,580
Adjusted diluted income per common share attributable to H.B. Fuller 1		$	0.66			$	0.34
Revenue		$	725,904			$	646,564
Adjusted EBITDA margin 1			13.9	%			12.0	%

1 Adjusted net income attributable to H.B. Fuller, adjusted diluted income per common share attributable to H.B. Fuller, adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures. Adjusted net income attributable to H.B. Fuller is defined as net income before the specific adjustments shown above. Adjusted diluted income per common share is defined as adjusted net income attributable to H.B. Fuller divided by the number of diluted common shares. Adjusted EBITDA is defined as net income before interest, income taxes, depreciation, amortization and the specific adjustments shown above. Adjusted EBITDA margin is defined as adjusted EBITDA divided by net revenue. The table above provides a reconciliation of adjusted net income attributable to H.B. Fuller, adjusted diluted income per common share attributable to H.B. Fuller, adjusted EBITDA and adjusted EBITDA margin to net income attributable to H.B. Fuller, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

2 Depreciation and amortization expense added back for EBITDA is adjusted for amounts already included in Adjusted net income attributable to H.B. Fuller totaling ($227) and ($33) for the three months ended February 27, 2021 and February 29, 2020, respectively.

H.B. FULLER COMPANY AND SUBSIDIARIES

SEGMENT FINANCIAL INFORMATION

In thousands (unaudited)

		13 Weeks Ended
		February 27,				February 29,
		2021				2020
Net Revenue:
Hygiene, Health and Consumable Adhesives		$	335,669			$	312,512
Engineering Adhesives			312,663				248,895
Construction Adhesives			77,572				85,157
Corporate unallocated			-				-
Total H.B. Fuller		$	725,904			$	646,564
Segment Operating Income:
Hygiene, Health and Consumable Adhesives		$	29,912			$	22,664
Engineering Adhesives			30,417				15,365
Construction Adhesives			(4,703	)			(1,373	)
Corporate unallocated			(7,276	)			(7,903	)
Total H.B. Fuller		$	48,350			$	28,753
Adjusted EBITDA 1
Hygiene, Health and Consumable Adhesives		$	44,606			$	35,896
Engineering Adhesives			48,168				30,916
Construction Adhesives			6,286				8,873
Corporate unallocated			1,813				2,092
Total H.B. Fuller		$	100,873			$	77,777
Adjusted EBITDA Margin 1
Hygiene, Health and Consumable Adhesives			13.3	%			11.5	%
Engineering Adhesives			15.4	%			12.4	%
Construction Adhesives			8.1	%			10.4	%
Corporate unallocated		NMP				NMP
Total H.B. Fuller			13.9	%			12.0	%
NMP = non-meaningful percentage

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands, except per share amounts (unaudited)

		13 Weeks Ended
		February 27,				February 29,
		2021				2020
Income before income taxes and income from equity method investments		$	38,517			$	13,883
Adjustments:
Acquisition project costs			73				213
Organizational realignment			3,635				2,865
Royal restructuring and integration			1,282				2,986
Tax reform			-				(35	)
Project One			2,205				1,375
Other			45				473
Adjusted income before income taxes and income from equity method investments 3		$	45,757			$	21,760

3 Adjusted income before income taxes and income from equity investments is a non-GAAP financial measure. Adjusted income before income taxes and income from equity investments is defined as income before income taxes and income from equity investments before the specific adjustments shown above. The table above provides a reconciliation of adjusted income before income taxes and income from equity investments to income before income taxes and income from equity investments, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands, except per share amounts (unaudited)

		13 Weeks Ended
		February 27,				February 29,
		2021				2020
Income Taxes		$	(10,607	)		$	(5,611	)
Adjustments:
Acquisition project costs			(20	)			55
Organizational realignment			(1,013	)			739
Royal restructuring and integration			(357	)			765
Tax reform			-				(9	)
Project One			(615	)			352
Other			29				(1,883	)
Adjusted income taxes 4		$	(12,583	)		$	(5,592	)
Adjusted income before income taxes and income from equity method investments		$	45,757			$	21,760
Adjusted effective income tax rate 4			27.5	%			25.7	%

4 Adjusted income taxes and adjusted effective income tax rate are non-GAAP financial measures. Adjusted income taxes are defined as income taxes before the specific adjustments shown above. Adjusted effective income tax rate is defined as income taxes divided by adjusted income before income taxes and income from equity method investments. The table above provides a reconciliation of adjusted income taxes and adjusted effective income tax rate to income taxes, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands (unaudited)

		13 Weeks Ended
		February 27,				February 29,
		2021				2020
Net revenue		$	725,904			$	646,564
Gross profit		$	192,364			$	170,262
Gross profit margin			26.5	%			26.3	%
Adjustments:
Organizational realignment			249				81
Royal restructuring and integration			740				900
Other			725				-
Other			9				10
Adjusted gross profit 5		$	194,087			$	171,253
Adjusted gross profit margin 5			26.7	%			26.5	%

5 Adjusted gross profit and adjusted gross profit margin are non-GAAP financial measures. Adjusted gross profit and adjusted gross profit margin is defined as gross profit and gross profit margin excluding the specific adjustments shown above. The table above provides a reconciliation of adjusted gross profit and gross profit margin to gross profit and gross profit margin, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands (unaudited)

		13 Weeks Ended
		February 27,				February 29,
		2021				2020
Selling, general and administrative expenses		$	(144,014	)		$	(141,509	)
Adjustments:
Acquisition project costs			73				213
Organizational realignment			3,387				2,784
Royal restructuring and integration			572				2,111
Tax reform			-				(35	)
Project ONE			1,480				1,375
Other			37				462
Adjusted selling, general and administrative expenses 6		$	(138,465	)		$	(134,599	)

6 Adjusted selling, general and administrative expenses is a non-GAAP financial measure. Adjusted selling, general and administrative expenses is defined as selling, general and administrative expenses excluding the specific adjustments shown above. The table above provides a reconciliation of adjusted selling, general and administrative expenses to selling, general and administrative expenses, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands (unaudited)

		Hygiene, Health
13 Weeks Ended:		and Consumable				Engineering				Construction								Corporate				H.B. Fuller
February 27, 2021		Adhesives				Adhesives				Adhesives				Total				Unallocated				Consolidated
Net income attributable to H.B. Fuller		$	33,170			$	32,916			$	(2,528	)		$	63,558			$	(33,767	)		$	29,791
Adjustments:
Acquisition project costs			-				-				-				-				53				53
Organizational realignment			-				-				-				-				2,622				2,622
Royal Restructuring			-				-				-				-				924				924
Tax reform			-				-				-				-				-				-
Project One			-				-				-				-				1,590				1,590
Other			-				-				-				-				75				75
Adjusted net income attributable to H.B. Fuller 1			33,170				32,916				(2,528	)			63,558				(28,503	)			35,055
Add:
Interest expense			-				-				-				-				20,392				20,392
Interest income			-				-				-				-				(2,659	)			(2,659	)
Income taxes			-				-				-				-				12,583				12,583
Depreciation and amortization expense			11,436				15,252				8,813				35,502				-				35,502
Adjusted EBITDA 1		$	44,606			$	48,168			$	6,286			$	99,060			$	1,813			$	100,873
Revenue		$	335,669			$	312,663			$	77,572			$	725,904				(0	)		$	725,904
Adjusted EBITDA Margin 1			13.3	%			15.4	%			8.1	%			13.6	%		NMP					13.9	%

		Hygiene, Health
13 Weeks Ended:		and Consumable				Engineering				Construction								Corporate				H.B. Fuller
February 29, 2020		Adhesives				Adhesives				Adhesives				Total				Unallocated				Consolidated
Net income attributable to H.B. Fuller		$	24,487			$	16,835			$	(189	)		$	41,133			$	(31,238	)		$	9,895
Adjustments:
Acquisition project costs			-				-				-				-				268				268
Organizational realignment			-				-				-				-				3,604				3,604
Royal Restructuring			-				-				-				-				3,750				3,750
Tax reform			-				-				-				-				(44	)			(44	)
Project One			-				-				-				-				1,727				1,727
Other			-				-				-				-				(1,410	)			(1,410	)
Adjusted net income attributable to H.B. Fuller 1			24,487				16,835				(189	)			41,133				(23,343	)			17,790
Add:
Interest expense			-				-				-				-				22,761				22,761
Interest income			-				-				-				-				(2,918	)			(2,918	)
Income taxes			-				-				-				-				5,592				5,592
Depreciation and amortization expense			11,409				14,081				9,062				34,552				-				34,552
Adjusted EBITDA 1		$	35,896			$	30,916			$	8,873			$	75,685			$	2,092			$	77,777
Revenue		$	312,512			$	248,895			$	85,157			$	646,564				-			$	646,564
Adjusted EBITDA Margin 1			11.5	%			12.4	%			10.4	%			11.7	%		NMP					12.0	%

Note: Adjusted EBITDA is a non-GAAP financial measure. The table above provides a reconciliation of adjusted EBITDA for each segment to net income attributable to H.B. Fuller for each segment, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

NMP = Non-meaningful percentage

H.B. FULLER COMPANY AND SUBSIDIARIES SEGMENT FINANCIAL INFORMATION NET REVENUE GROWTH (unaudited)
		13 Weeks Ended
		February 27, 2021
Price			0.0	%
Volume			10.5	%
Organic Growth			10.5	%
M&A			0.0	%
F/X			1.8	%
Total H.B. Fuller Net Revenue Growth			12.3	%

		13 Weeks Ended
		February 27, 2021
										Organic
										Growth
		Net Revenue				F/X				(Decline)
Hygiene, Health and Consumable Adhesives			7.4	%			(0.2	)%			7.6	%
Engineering Adhesives			25.6	%			4.5	%			21.1	%
Construction Adhesives			(8.9	)%			1.1	%			(10.0	)%
Total H.B. Fuller			12.3	%			1.8	%			10.5	%

CONSOLIDATED BALANCE SHEET

H.B. FULLER COMPANY AND SUBSIDIARIES

(In thousands, except share and per share amounts)

		February 27,				November 28,
		2021				2020
Assets
Current assets:
Cash and cash equivalents		$	81,192			$	100,534
Trade receivables (net of allowances of $12,037 and $12,905, as of February 27, 2021
and November 28, 2020, respectively)			504,994				514,916
Inventories			388,773				323,213
Other current assets			101,641				81,113
Total current assets			1,076,600				1,019,776
Property, plant and equipment			1,443,107				1,428,183
Accumulated depreciation			(773,663	)			(757,439	)
Property, plant and equipment, net			669,444				670,744
Goodwill			1,322,160				1,312,003
Other intangibles, net			746,996				755,968
Other assets			298,550				278,213
Total assets		$	4,113,750			$	4,036,704
Liabilities, non-controlling interest and total equity
Current liabilities:
Notes payable		$	16,323			$	16,925
Trade payables			373,604				316,460
Accrued compensation			65,994				83,598
Income taxes payable			27,793				29,173
Other accrued expenses			84,531				83,976
Total current liabilities			568,245				530,132
Long-term debt			1,741,893				1,756,985
Accrued pension liabilities			89,273				88,806
Other liabilities			272,176				278,919
Total liabilities			2,671,587				2,654,842
Commitments and contingencies (Note 15)
Equity:
H.B. Fuller stockholders' equity:
Preferred stock (no shares outstanding) shares authorized – 10,045,900			-				-
Common stock, par value $1.00 per share, shares authorized – 160,000,000, shares
outstanding – 52,155,305 and 51,906,663, as of February 27, 2021 and November 28,
2020, respectively			52,155				51,907
Additional paid-in capital			169,010				157,867
Retained earnings			1,495,655				1,474,406
Accumulated other comprehensive loss			(275,203	)			(302,859	)
Total H.B. Fuller stockholders' equity			1,441,617				1,381,321
Non-controlling interest			546				541
Total equity			1,442,163				1,381,862
Total liabilities, non-controlling interest and total equity		$	4,113,750			$	4,036,704

CONSOLIDATED STATEMENT OF CASH FLOWS H.B. FULLER COMPANY AND SUBSIDIARIES (In thousands)
		Three Months Ended
		February 27, 2021				February 29, 2020
Cash flows from operating activities:
Net income including non-controlling interest		$	29,806			$	9,906
Adjustments to reconcile net income including non-controlling interest to net cash provided by operating activities:
Depreciation			17,833				16,595
Amortization			17,896				17,990
Deferred income taxes			(2,281	)			(4,035	)
Income from equity method investments, net of dividends received			(1,896	)			(1,634	)
Gain on sale of assets			(16	)			-
Share-based compensation			6,821				4,703
Pension and post-retirement benefit activity			(7,999	)			(1,120	)
Change in assets and liabilities, net of effects of acquisitions:
Trade receivables, net			3,318				33,705
Inventories			(63,598	)			(46,947	)
Other assets			(1,871	)			(32,769	)
Trade payables			67,373				55,110
Accrued compensation			(18,146	)			(21,145	)
Other accrued expenses			753				(3,055	)
Income taxes payable			882				(3,040	)
Other liabilities			(17,921	)			12,801
Other			4,895				(2,638	)
Net cash provided by operating activities			35,849				34,427
Cash flows from investing activities:
Purchased property, plant and equipment			(35,283	)			(32,124	)
Purchased businesses, net of cash acquired			(5,445	)			(9,500	)
Purchase of assets			-				(3,998	)
Proceeds from sale of property, plant and equipment			263				1,516
Cash payments related to government grant			(1,526	)			(234	)
Net cash used in investing activities			(41,991	)			(44,340	)
Cash flows from financing activities:
Repayment of long-term debt			(11,000	)			(13,000	)
Net (payments) proceeds of notes payable			(22	)			1,497
Dividends paid			(8,460	)			(8,222	)
Proceeds from stock options exercised			6,398				907
Repurchases of common stock			(2,580	)			(3,213	)
Net cash used in financing activities			(15,664	)			(22,031	)
Effect of exchange rate changes on cash and cash equivalents			2,464				(1,509	)
Net change in cash and cash equivalents			(19,342	)			(33,453	)
Cash and cash equivalents at beginning of period			100,534				112,191
Cash and cash equivalents at end of period		$	81,192			$	78,738

 

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FAQ

What are H.B. Fuller's Q1 2021 financial results?

In Q1 2021, H.B. Fuller reported a 12.3% increase in net revenue to $726 million and adjusted EBITDA of $101 million, representing a 30% increase year-over-year.

What is the adjusted EPS for H.B. Fuller in Q1 2021?

The adjusted EPS for H.B. Fuller in Q1 2021 was $0.66, nearly doubling from $0.34 in the same quarter last year.

What challenges does H.B. Fuller face in 2021?

H.B. Fuller expects rising raw material costs, estimated to increase by 5% to 8% throughout the year.

How much debt did H.B. Fuller pay down in Q1 2021?

H.B. Fuller paid down approximately $16 million in debt in Q1 2021.

What is H.B. Fuller's revenue growth outlook for 2021?

H.B. Fuller anticipates high-single digit to low double-digit revenue growth for the full year 2021.