Matthews International Reports Results for Fiscal 2025 First Quarter
Matthews International (MATW) reported Q1 fiscal 2025 results with sales of $401.8 million, down 10.7% from $450.0 million in Q1 2024. The company posted a net loss of $3.5 million ($0.11 per share) compared to a $2.3 million loss ($0.07 per share) in the prior year. Adjusted EBITDA decreased to $40.0 million from $45.5 million.
The company maintains its fiscal 2025 adjusted EBITDA outlook of $205-215 million. A positive arbitration ruling affirmed Matthews' right to sell its DBE technology. The planned SGK Brand Solutions transaction, expected to complete by mid-2025, will yield $350 million upfront including $250 million cash plus a 40% interest in the new entity. The company expects to achieve cost reductions of at least $50 million through ongoing initiatives.
The Memorialization segment saw lower sales due to decreased U.S. deaths, while SGK Brand Solutions reported modest sales growth. Industrial Technologies experienced declining sales, primarily due to reduced Tesla project work and litigation impact.
Matthews International (MATW) ha riportato i risultati del primo trimestre fiscale 2025 con vendite di 401,8 milioni di dollari, in calo del 10,7% rispetto ai 450,0 milioni di dollari del primo trimestre 2024. L'azienda ha registrato una perdita netta di 3,5 milioni di dollari (0,11 dollari per azione) rispetto a una perdita di 2,3 milioni di dollari (0,07 dollari per azione) dell'anno precedente. Il EBITDA rettificato è diminuito a 40,0 milioni di dollari rispetto ai 45,5 milioni di dollari.
L'azienda mantiene le previsioni per l'EBITDA rettificato fiscal 2025 che vanno da 205 a 215 milioni di dollari. Una decisione arbitrale favorevole ha confermato il diritto di Matthews di vendere la propria tecnologia DBE. La transazione pianificata di SGK Brand Solutions, prevista per completarsi entro metà 2025, porterà 350 milioni di dollari in anticipo, di cui 250 milioni in contanti più una partecipazione del 40% nella nuova entità. L'azienda si aspetta di ottenere una riduzione dei costi di almeno 50 milioni di dollari attraverso iniziative in corso.
Il segmento Memorialization ha registrato vendite più basse a causa di un numero ridotto di decessi negli Stati Uniti, mentre SGK Brand Solutions ha riportato una modesta crescita delle vendite. Le Tecnologie Industriali hanno visto un calo delle vendite, principalmente a causa della diminuzione del lavoro su progetti Tesla e dell'impatto delle controversie legali.
Matthews International (MATW) informó los resultados del primer trimestre fiscal 2025 con ventas de 401.8 millones de dólares, lo que representa una caída del 10.7% con respecto a los 450.0 millones de dólares del primer trimestre de 2024. La empresa registró una pérdida neta de 3.5 millones de dólares (0.11 dólares por acción) en comparación con una pérdida de 2.3 millones de dólares (0.07 dólares por acción) en el año anterior. El EBITDA ajustado disminuyó a 40.0 millones de dólares desde 45.5 millones de dólares.
La empresa mantiene sus expectativas de EBITDA ajustado para el fiscal 2025 de 205 a 215 millones de dólares. Un fallo arbitral favorable reafirmó el derecho de Matthews a vender su tecnología DBE. La transacción planificada de SGK Brand Solutions, que se espera completar a mediados de 2025, generará 350 millones de dólares por adelantado, incluyendo 250 millones en efectivo más un 40% de participación en la nueva entidad. La empresa espera lograr reducciones de costos de al menos 50 millones de dólares a través de iniciativas en curso.
El segmento de Memorialización vio una menor venta debido a la disminución de muertes en EE. UU., mientras que SGK Brand Solutions reportó un modesto crecimiento en ventas. Las Tecnologías Industriales experimentaron una disminución en las ventas, principalmente debido a la reducción del trabajo en proyectos de Tesla y el impacto de litigios.
매튜스 인터내셔널 (MATW)는 2025 회계연도 1분기 실적을 보고하며 매출이 4억 1,800만 달러로 2024 회계연도 1분기 매출 4억 5,000만 달러에서 10.7% 감소했다고 밝혔습니다. 회사는 지난해 230만 달러 손실(주당 0.07달러)에서 350만 달러 손실(주당 0.11달러)을 기록했습니다. 조정된 EBITDA는 4,000만 달러로 4,550만 달러에서 감소했습니다.
회사는 2025 회계연도 조정된 EBITDA 전망을 2억 5천 - 2억 1천5백만 달러로 유지하고 있습니다. 긍정적인 중재 판결이 매튜스가 DBE 기술을 판매할 권리를 확인했습니다. 2025년 중반까지 완료될 예정인 SGK 브랜드 솔루션 거래는 3억 5천만 달러의 선불을 제공하며, 여기에는 2억 5천만 달러의 현금과 새로운 법인에서 40%의 지분이 포함됩니다. 회사는 지속적인 이니셔티브를 통해 최소 5천만 달러의 비용 절감을 달성할 것으로 예상하고 있습니다.
추모 부문은 미국의 사망자 수 감소로 인해 매출이 감소했으며, SGK 브랜드 솔루션은 매출이 소폭 증가했습니다. 산업 기술 부문은 테슬라 프로젝트 작업 감소와 소송의 영향으로 매출이 감소했습니다.
Matthews International (MATW) a annoncé des résultats pour le premier trimestre de l'exercice fiscal 2025 avec des ventes de 401,8 millions de dollars, en baisse de 10,7 % par rapport à 450,0 millions de dollars au premier trimestre 2024. L'entreprise a enregistré une perte nette de 3,5 millions de dollars (0,11 dollar par action) comparativement à une perte de 2,3 millions de dollars (0,07 dollar par action) l'année précédente. Le EBITDA ajusté a diminué à 40,0 millions de dollars contre 45,5 millions de dollars.
L'entreprise maintient ses prévisions de EBITDA ajusté pour l'exercice 2025 entre 205 et 215 millions de dollars. Une décision d'arbitrage positive a confirmé le droit de Matthews de vendre sa technologie DBE. La transaction prévue avec SGK Brand Solutions, qui devrait être finalisée d'ici la mi-2025, rapportera 350 millions de dollars d'avance, dont 250 millions de dollars en espèces et 40 % de participation dans la nouvelle entité. L'entreprise s'attend à réaliser des économies d'au moins 50 millions de dollars grâce à des initiatives en cours.
Le segment de la mémorialisation a connu une baisse des ventes en raison d'une diminution des décès aux États-Unis, tandis que SGK Brand Solutions a enregistré une modeste croissance des ventes. Les Technologies Industrielles ont connu une baisse des ventes, principalement en raison d'une diminution du travail sur les projets Tesla et des impacts des litiges.
Matthews International (MATW) berichtete über die Ergebnisse des ersten Quartals des Geschäftsjahres 2025 mit einem Umsatz von 401,8 Millionen US-Dollar, was einem Rückgang von 10,7 % gegenüber 450,0 Millionen US-Dollar im ersten Quartal 2024 entspricht. Das Unternehmen verzeichnete einen netto Verlust von 3,5 Millionen US-Dollar (0,11 US-Dollar pro Aktie) im Vergleich zu einem Verlust von 2,3 Millionen US-Dollar (0,07 US-Dollar pro Aktie) im Vorjahr. Das angepasste EBITDA sank auf 40,0 Millionen US-Dollar von 45,5 Millionen US-Dollar.
Das Unternehmen hält seine Prognose für das angepasste EBITDA für das Geschäftsjahr 2025 bei 205-215 Millionen US-Dollar. Ein positives Schiedsurteil bestätigte das Recht von Matthews, seine DBE-Technologie zu verkaufen. Die geplante Transaktion mit SGK Brand Solutions, die bis Mitte 2025 abgeschlossen sein soll, wird 350 Millionen US-Dollar im Voraus einbringen, einschließlich 250 Millionen US-Dollar in bar zuzüglich 40 % Anteil an der neuen Einheit. Das Unternehmen erwartet, durch laufende Initiativen Einsparungen in Höhe von mindestens 50 Millionen US-Dollar zu erzielen.
Der Bereich Memorabilia verzeichnete einen Rückgang der Verkäufe aufgrund sinkender Sterberaten in den USA, während SGK Brand Solutions ein moderates Umsatzwachstum meldete. Die Industrie-Technologien verzeichneten einen Rückgang beim Umsatz, hauptsächlich aufgrund verringerten Projektaufwands bei Tesla und der Auswirkungen von Rechtsstreitigkeiten.
- Positive arbitration ruling allows company to market DBE technology to other customers
- SGK transaction to provide $350M upfront ($250M cash) plus 40% stake in new entity
- Cost reduction program on track to achieve $50M+ in savings
- Expected synergies exceeding $50M from SGK transaction
- SGK Brand Solutions segment showed modest sales growth
- Q1 sales declined 10.7% to $401.8M
- Net loss increased to $3.5M from $2.3M year-over-year
- Adjusted EBITDA decreased 12% to $40.0M
- Debt increased by $32.7M during Q1
- Industrial Technologies segment sales declined significantly
- Healthcare costs increased by $1.6M compared to previous year
Insights
The Q1 FY2025 results reveal a complex transformation period for Matthews International, marked by both challenges and strategic repositioning. The headline numbers -
The SGK transaction structure is particularly noteworthy:
Segment performance reveals important trends:
- Memorialization segment showed resilience despite lower U.S. deaths, maintaining EBITDA through improved pricing and cost management
- SGK Brand Solutions demonstrated growth in U.S. brands and Asia-Pacific markets, though European markets remain soft
- Industrial Technologies faced expected headwinds from Tesla litigation, but the favorable arbitration ruling opens new market opportunities for DBE technology
The
Management's maintained guidance of
Fiscal 2025 First Quarter Financial Highlights:
- Company maintains outlook for fiscal 2025 (subject to the completion of the SGK Brand Solutions (SGK) transaction)
- Positive arbitration ruling affirms Company's right to sell its DBE solutions
- Cost reduction program on track
- Regulatory filings for SGK transaction initiated; continue to expect transaction to be completed by mid-2025 with proceeds applied substantially to debt reduction
- Webcast: Friday, February 7, 2025, 9:00 a.m., (201) 689-8471
PITTSBURGH, Feb. 06, 2025 (GLOBE NEWSWIRE) -- Matthews International Corporation (NASDAQ GSM: MATW) today announced financial results for its first quarter of fiscal 2025.
In discussing the results for the Company’s fiscal 2025 first quarter, Joseph C. Bartolacci, President and Chief Executive Officer, stated:
“Our results for the fiscal 2025 first quarter were generally in line with our expectations and, as a result, we are maintaining our outlook for the full fiscal year. The Memorialization and SGK Brand Solutions segments continued their solid performance in the quarter. Further, as we also anticipated, results for the Industrial Technologies segment were challenged by the impact of the Tesla litigation, and we look forward to improving in this business.
“As we announced this morning, yesterday's ruling in our case against Tesla affirmed our ownership rights to our groundbreaking Dry Battery Electrode technology. Pursuant to the arbitrator's ruling and consistent with our contractual rights, we intend to immediately begin marketing, selling, and delivering our DBE solutions to other customers and unlock their value for shareholders.
“With respect to the recently announced SGK transaction, we initiated the required regulatory filing process, and remain on track to complete the transaction by mid-2025. Consideration to Matthews upon closing will be
“Furthermore, the Board’s comprehensive evaluation of strategic alternatives for our entire portfolio remains ongoing.
“As we announced in November 2024, we have significant cost reduction actions which are now underway and progressing well. Although the upfront costs incurred in connection with these actions have unfavorably affected our current GAAP results, we remain on track to achieve cost reductions of at least
“Adjusted EBITDA for the Memorialization segment was relatively unchanged compared to the first quarter last year. The segment reported lower sales compared to last year primarily reflecting the impact of lower U.S. deaths and the prior year included sales in connection with a reduction in backlog of granite memorials. However, the impact of these declines on adjusted EBITDA for the current quarter was mitigated by the benefits from ongoing productivity and cost reduction initiatives and improved price realization.
“The SGK Brand Solutions segment reported a modest increase in sales for the current quarter compared to last year. The U.S. brand market continued to demonstrate improving conditions and sales in the Asia-Pacific region increased. In addition, private label and European cylinder sales increased compared to a year ago, while the European brand markets remained soft.
“Sales for the Industrial Technologies segment for the current quarter declined from the first quarter last year. As anticipated, the engineering business reported significantly lower sales, primarily reflecting a slowdown in Tesla project work and the impact of the litigation on work with other customers.
“Litigation costs related to the Tesla matter have also unfavorably impacted our GAAP results. In addition, health care costs were approximately
“Outstanding debt increased
“In November 2024, we projected adjusted EBITDA in the range of
First Quarter Fiscal 2025 Consolidated Results (Unaudited)
| ($ in millions, except per share data) | Q1 FY2025 | Q1 FY2024 | Change | % Change | |||||||||||
| Sales | $ | 401.8 | $ | 450.0 | $ | (48.2 | ) | (10.7 | )% | ||||||
| Net loss attributable to Matthews | $ | (3.5 | ) | $ | (2.3 | ) | $ | (1.2 | ) | 50.8 | % | ||||
| Diluted loss per share | $ | (0.11 | ) | $ | (0.07 | ) | $ | (0.04 | ) | 57.1 | % | ||||
| Non-GAAP adjusted net income | $ | 4.3 | $ | 11.3 | $ | (7.0 | ) | (61.8 | )% | ||||||
| Non-GAAP adjusted EPS | $ | 0.14 | $ | 0.37 | $ | (0.23 | ) | (62.2 | )% | ||||||
| Adjusted EBITDA | $ | 40.0 | $ | 45.5 | $ | (5.5 | ) | (12.0 | )% | ||||||
| Note: See the attached tables for additional important disclosures regarding Matthews’ use of non-GAAP measures as well as reconciliations of non-GAAP measures to corresponding GAAP measures. | |||||||||||||||
Consolidated sales for the quarter ended December 31, 2024 were
Webcast
The Company will host a conference call and webcast on Friday, February 7, 2025 at 9:00 a.m. Eastern Time to review its financial and operating results and discuss its corporate strategies and outlook. A question-and-answer session will follow. The conference call can be accessed by dialing (201) 689-8471. The audio webcast can be monitored at www.matw.com. As soon as available after the call, a transcript of the call will be posted on the Investor Relations section of the Company’s website at www.matw.com.
About Matthews International Corporation
Matthews International Corporation is a global provider of memorialization products, industrial technologies, and brand solutions. The Memorialization segment is a leading provider of memorialization products, including memorials, caskets, cremation-related products, and cremation and incineration equipment, primarily to cemetery and funeral home customers that help families move from grief to remembrance. The Industrial Technologies segment includes the design, manufacturing, service and sales of high-tech custom energy storage solutions; product identification and warehouse automation technologies and solutions, including order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products; and coating and converting lines for the packaging, pharma, foil, décor and tissue industries. The SGK Brand Solutions segment is a leading provider of packaging solutions and brand experiences, helping companies simplify their marketing, amplify their brands and provide value. The Company has over 11,000 employees in more than 30 countries on six continents that are committed to delivering the highest quality products and services.
Forward-looking Information
Any forward-looking statements contained in this release are included pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements regarding the expectations, hopes, beliefs, intentions or strategies of the Company regarding the future, including statements regarding the anticipated timing and benefits of the proposed joint venture transaction, and may be identified by the use of words such as “expects,” “believes,” “intends,” “projects,” “anticipates,” “estimates,” “plans,” “seeks,” “forecasts,” “predicts,” “objective,” “targets,” “potential,” “outlook,” “may,” “will,” “could” or the negative of these terms, other comparable terminology and variations thereof. Such forward-looking statements involve known and unknown risks and uncertainties that may cause the Company’s actual results in future periods to be materially different from management’s expectations, and no assurance can be given that such expectations will prove correct. Factors that could cause the Company's results to differ materially from the results discussed in such forward-looking statements principally include the possibility that the terms of the final award to be issued by the Arbitrator in the Tesla, Inc. ("Tesla") dispute may differ from the terms of the interim award issued by the Arbitrator and may be challenged, our ability to satisfy the conditions precedent to the consummation of the proposed joint venture transaction on the expected timeline or at all, our ability to achieve the anticipated benefits of the proposed joint venture transaction, uncertainties regarding future actions that may be taken by Barington in furtherance of its intention to nominate director candidates for election at the Company’s 2025 Annual Meeting, potential operational disruption caused by Barington’s actions that may make it more difficult to maintain relationships with customers, employees or partners, changes in domestic or international economic conditions, changes in foreign currency exchange rates, changes in interest rates, changes in the cost of materials used in the manufacture of the Company's products, including changes in costs due to adjustments to tariffs, any impairment of goodwill or intangible assets, environmental liability and limitations on the Company’s operations due to environmental laws and regulations, disruptions to certain services, such as telecommunications, network server maintenance, cloud computing or transaction processing services, provided to the Company by third-parties, changes in mortality and cremation rates, changes in product demand or pricing as a result of consolidation in the industries in which the Company operates, or other factors such as supply chain disruptions, labor shortages or labor cost increases, changes in product demand or pricing as a result of domestic or international competitive pressures, ability to achieve cost-reduction objectives, unknown risks in connection with the Company's acquisitions, divestitures and business combinations, cybersecurity concerns and costs arising with management of cybersecurity threats, effectiveness of the Company's internal controls, compliance with domestic and foreign laws and regulations, technological factors beyond the Company's control, impact of pandemics or similar outbreaks, or other disruptions to our industries, customers, or supply chains, the impact of global conflicts, such as the current war between Russia and Ukraine, the Company's plans and expectations with respect to its exploration, and contemplated execution, of various strategies with respect to its portfolio of businesses, the Company's plans and expectations with respect to its Board, and other factors described in the Company’s Annual Report on Form 10-K and other periodic filings with the U.S. Securities and Exchange Commission.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(In thousands, except per share data)
| Three Months Ended December 31, | |||||||||||
| 2024 | 2023 | % Change | |||||||||
| Sales | $ | 401,842 | $ | 449,986 | (10.7 | )% | |||||
| Cost of sales | (276,150 | ) | (317,633 | ) | (13.1 | )% | |||||
| Gross profit | 125,692 | 132,353 | (5.0 | )% | |||||||
| Gross margin | 31.3 | % | 29.4 | % | |||||||
| Selling and administrative expenses | (111,410 | ) | (113,131 | ) | (1.5 | )% | |||||
| Amortization of intangible assets | (8,608 | ) | (9,795 | ) | (12.1 | )% | |||||
| Operating profit | 5,674 | 9,427 | (39.8 | )% | |||||||
| Operating margin | 1.4 | % | 2.1 | % | |||||||
| Interest and other deductions, net | (11,504 | ) | (12,456 | ) | (7.6 | )% | |||||
| Loss before income taxes | (5,830 | ) | (3,029 | ) | 92.5 | % | |||||
| Income taxes | 2,358 | 726 | NM | ||||||||
| Net loss | (3,472 | ) | (2,303 | ) | 50.8 | % | |||||
| Non-controlling interests | — | — | — | % | |||||||
| Net loss attributable to Matthews | $ | (3,472 | ) | $ | (2,303 | ) | 50.8 | % | |||
| Loss per share -- diluted | $ | (0.11 | ) | $ | (0.07 | ) | 57.1 | % | |||
| Earnings per share -- non-GAAP (1) | $ | 0.14 | $ | 0.37 | (62.2 | )% | |||||
| Dividends declared per share | $ | 0.25 | $ | 0.24 | 4.2 | % | |||||
| Diluted Shares | 31,110 | 30,915 | |||||||||
| (1) See reconciliation of non-GAAP financial information provided in tables at the end of this release | |||||||||||
| NM: Not meaningful | |||||||||||
| SEGMENT INFORMATION (Unaudited) (In thousands) | |||||||
| Three Months Ended December 31, | |||||||
| 2024 | 2023 | ||||||
| Sales: | |||||||
| Memorialization | $ | 190,486 | $ | 208,071 | |||
| Industrial Technologies | 80,533 | 111,374 | |||||
| SGK Brand Solutions | 130,823 | 130,541 | |||||
| $ | 401,842 | $ | 449,986 | ||||
| Adjusted EBITDA: | |||||||
| Memorialization | $ | 36,612 | $ | 36,700 | |||
| Industrial Technologies | 1,832 | 9,622 | |||||
| SGK Brand Solutions | 12,292 | 12,893 | |||||
| Corporate and Non-Operating | (10,713 | ) | (13,733 | ) | |||
| Total Adjusted EBITDA (1) | $ | 40,023 | $ | 45,482 | |||
| (1) See reconciliation of non-GAAP financial information provided in tables at the end of this release | |||||||
| CONDENSED CONSOLIDATED BALANCE SHEET INFORMATION (Unaudited) (In thousands) | |||||||
| December 31, 2024 | September 30, 2024 | ||||||
| ASSETS | |||||||
| Cash and cash equivalents | $ | 33,513 | $ | 40,816 | |||
| Accounts receivable, net | 199,303 | 205,984 | |||||
| Inventories, net | 241,585 | 237,888 | |||||
| Other current assets | 148,798 | 147,855 | |||||
| Total current assets | 623,199 | 632,543 | |||||
| Property, plant and equipment, net | 264,895 | 279,499 | |||||
| Goodwill | 685,967 | 697,123 | |||||
| Other intangible assets, net | 116,878 | 126,026 | |||||
| Other long-term assets | 100,780 | 99,699 | |||||
| Total assets | $ | 1,791,719 | $ | 1,834,890 | |||
| LIABILITIES | |||||||
| Long-term debt, current maturities | $ | 7,260 | $ | 6,853 | |||
| Other current liabilities | 388,321 | 427,922 | |||||
| Total current liabilities | 395,581 | 434,775 | |||||
| Long-term debt | 801,951 | 769,614 | |||||
| Other long-term liabilities | 180,731 | 193,295 | |||||
| Total liabilities | 1,378,263 | 1,397,684 | |||||
| SHAREHOLDERS' EQUITY | |||||||
| Total shareholders' equity | 413,456 | 437,206 | |||||
| Total liabilities and shareholders' equity | $ | 1,791,719 | $ | 1,834,890 | |||
| CONDENSED CONSOLIDATED CASH FLOWS INFORMATION (Unaudited) (In thousands) | |||||||
| Three Months Ended December 31, | |||||||
| 2024 | 2023 | ||||||
| Cash flows from operating activities: | |||||||
| Net loss | $ | (3,472 | ) | $ | (2,303 | ) | |
| Adjustments to reconcile net loss to net cash flows from operating activities: | |||||||
| Depreciation and amortization | 22,504 | 23,523 | |||||
| Changes in working capital items | (39,170 | ) | (51,640 | ) | |||
| Other operating activities | (4,871 | ) | 3,154 | ||||
| Net cash used in operating activities | (25,009 | ) | (27,266 | ) | |||
| Cash flows from investing activities: | |||||||
| Capital expenditures | (9,532 | ) | (14,073 | ) | |||
| Acquisitions, net of cash acquired | (2,218 | ) | — | ||||
| Other investing activities | 13,186 | (113 | ) | ||||
| Net cash provided by (used in) investing activities | 1,436 | (14,186 | ) | ||||
| Cash flows from financing activities: | |||||||
| Net payments from long-term debt | 31,949 | 62,579 | |||||
| Purchases of treasury stock | (4,275 | ) | (17,185 | ) | |||
| Dividends | (9,237 | ) | (9,280 | ) | |||
| Other financing activities | — | — | |||||
| Net cash provided by financing activities | 18,437 | 36,114 | |||||
| Effect of exchange rate changes on cash | (2,167 | ) | 1,158 | ||||
| Net change in cash and cash equivalents | $ | (7,303 | ) | $ | (4,180 | ) | |
Reconciliations of Non-GAAP Financial Measures
Included in this report are measures of financial performance that are not defined by GAAP, including, without limitation, adjusted EBITDA, adjusted net income and EPS, constant currency sales, constant currency adjusted EBITDA, net debt and net debt leverage ratio. The Company defines net debt leverage ratio as outstanding debt (net of cash) relative to adjusted EBITDA. The Company uses non-GAAP financial measures to assist in comparing its performance on a consistent basis for purposes of business decision-making by removing the impact of certain items that management believes do not directly reflect the Company’s core operations including acquisition and divestiture costs, ERP system integration costs, strategic initiative and other charges (which includes non-recurring charges related to certain commercial and operational initiatives and exit activities), stock-based compensation and the non-service portion of pension and postretirement expense. Constant currency sales and constant currency adjusted EBITDA remove the impact of changes due to foreign exchange translation rates. To calculate sales and adjusted EBITDA on a constant currency basis, amounts for periods in the current fiscal year are translated into U.S. dollars using exchange rates applicable to the comparable periods of the prior fiscal year. Management believes that presenting non-GAAP financial measures is useful to investors because it (i) provides investors with meaningful supplemental information regarding financial performance by excluding certain items that management believes do not directly reflect the Company's core operations, (ii) permits investors to view performance using the same tools that management uses to budget, forecast, make operating and strategic decisions, and evaluate historical performance, and (iii) otherwise provides supplemental information that may be useful to investors in evaluating the Company’s results. The Company's calculations of its non-GAAP financial measures, however, may not be comparable to similarly titled measures reported by other companies. The Company believes that the presentation of these non-GAAP financial measures, when considered together with the corresponding GAAP financial measures and the reconciliations to those measures, provided herein, provide investors with an additional understanding of the factors and trends affecting the Company’s business that could not be obtained absent these disclosures.
| ADJUSTED EBITDA RECONCILIATION (Unaudited) (In thousands) | |||||||
| Three Months Ended December 31, | |||||||
| 2024 | 2023 | ||||||
| Net loss | $ | (3,472 | ) | $ | (2,303 | ) | |
| Income tax benefit | (2,358 | ) | (726 | ) | |||
| Loss before income taxes | $ | (5,830 | ) | $ | (3,029 | ) | |
| Net loss attributable to noncontrolling interests | — | — | |||||
| Interest expense, including RPA and factoring financing fees (1) | 16,854 | 12,751 | |||||
| Depreciation and amortization * | 22,504 | 23,523 | |||||
| Acquisition and divestiture related items (2)** | 577 | 1,237 | |||||
| Strategic initiatives and other items (3)**† | 615 | 5,920 | |||||
| Highly inflationary accounting losses (primarily non-cash) (4) | 191 | 320 | |||||
| Stock-based compensation | 4,979 | 4,651 | |||||
| Non-service pension and postretirement expense (5) | 133 | 109 | |||||
| Total Adjusted EBITDA | $ | 40,023 | $ | 45,482 | |||
| Adjusted EBITDA margin | 10.0 | % | 10.1 | % | |||
| (1) Includes fees for receivables sold under the RPA and factoring arrangements totaling | |||||||
| (2) Includes certain non-recurring items associated with recent acquisition and divestiture activities. | |||||||
| (3) Includes certain non-recurring costs associated with commercial, operational and cost-reduction initiatives, and costs associated with global ERP system integration efforts. Also includes legal costs related to an ongoing dispute with Tesla, Inc. ("Tesla"), which totaled | |||||||
| (4) Represents exchange losses associated with highly inflationary accounting related to the Company's Turkish subsidiaries. | |||||||
| (5) Non-service pension and postretirement expense includes interest cost, expected return on plan assets, amortization of actuarial gains and losses, curtailment gains and losses, and settlement gains and losses. These benefit cost components are excluded from adjusted EBITDA since they are primarily influenced by external market conditions that impact investment returns and interest (discount) rates. Curtailment gains and losses and settlement gains and losses are excluded from adjusted EBITDA since they generally result from certain non-recurring events, such as plan amendments to modify future benefits or settlements of plan obligations. The service cost and prior service cost components of pension and postretirement expense are included in the calculation of adjusted EBITDA, since they are considered to be a better reflection of the ongoing service-related costs of providing these benefits. Please note that GAAP pension and postretirement expense or the adjustment above are not necessarily indicative of the current or future cash flow requirements related to these employee benefit plans. | |||||||
* Depreciation and amortization was
** Acquisition costs, ERP system integration costs, and strategic initiatives and other items were
† Strategic initiatives and other items includes charges for exit and disposal activities (including severance and other employee terminations) totaling
| ADJUSTED NET INCOME AND EPS RECONCILIATION (Unaudited) (In thousands, except per share data) | |||||||||||||
| Three Months Ended December 31, | |||||||||||||
| 2024 | 2023 | ||||||||||||
| per share | per share | ||||||||||||
| Net loss attributable to Matthews | $ | (3,472 | ) | $ | (0.11 | ) | $ | (2,303 | ) | $ | (0.07 | ) | |
| Acquisition and divestiture costs (1) | 355 | 0.01 | 899 | 0.03 | |||||||||
| Strategic initiatives and other charges (2) | 704 | 0.02 | 5,004 | 0.16 | |||||||||
| Highly inflationary accounting losses (primarily non-cash) (3) | 191 | 0.01 | 320 | 0.01 | |||||||||
| Non-service pension and postretirement expense (4) | 100 | — | 81 | — | |||||||||
| Amortization | 6,456 | 0.21 | 7,346 | 0.24 | |||||||||
| Adjusted net income | $ | 4,334 | $ | 0.14 | $ | 11,347 | $ | 0.37 | |||||
| Note: Adjustments to net income for non-GAAP reconciling items were calculated using an income tax rate of | |||||||||||||
| (1) Includes certain non-recurring costs associated with recent acquisition and divestiture activities. | |||||||||||||
| (2) Includes certain non-recurring costs associated with commercial, operational and cost-reduction initiatives, and costs associated with global ERP system integration efforts. Also includes legal costs related to an ongoing dispute with Tesla, Inc. ("Tesla"), which totaled | |||||||||||||
| (3) Represents exchange losses associated with highly inflationary accounting related to the Company's Turkish subsidiaries. | |||||||||||||
| (4) Non-service pension and postretirement expense includes interest cost, expected return on plan assets, amortization of actuarial gains and losses, curtailment gains and losses, and settlement gains and losses. These benefit cost components are excluded from adjusted EBITDA since they are primarily influenced by external market conditions that impact investment returns and interest (discount) rates. Curtailment gains and losses and settlement gains and losses are excluded from adjusted EBITDA since they generally result from certain non-recurring events, such as plan amendments to modify future benefits or settlements of plan obligations. The service cost and prior service cost components of pension and postretirement expense are included in the calculation of adjusted EBITDA, since they are considered to be a better reflection of the ongoing service-related costs of providing these benefits. Please note that GAAP pension and postretirement expense or the adjustment above are not necessarily indicative of the current or future cash flow requirements related to these employee benefit plans. | |||||||||||||
| CONSTANT CURRENCY SALES AND ADJUSTED EBITDA RECONCILIATION (Unaudited) (In thousands) | |||||||||||||||||||
| Memorialization | Industrial Technologies | SGK Brand Solutions | Corporate and Non-Operating | Consolidated | |||||||||||||||
| Reported sales for the three months ended December 31, 2024 | $ | 190,486 | $ | 80,533 | $ | 130,823 | $ | — | $ | 401,842 | |||||||||
| Changes in foreign exchange translation rates | 85 | 396 | 700 | — | 1,181 | ||||||||||||||
| Constant currency sales for the three months ended December 31, 2024 | $ | 190,571 | $ | 80,929 | $ | 131,523 | $ | — | $ | 403,023 | |||||||||
| Reported adjusted EBITDA for the three months ended December 31, 2024 | $ | 36,612 | $ | 1,832 | $ | 12,292 | $ | (10,713 | ) | $ | 40,023 | ||||||||
| Changes in foreign exchange translation rates | 15 | 26 | 97 | (44 | ) | 94 | |||||||||||||
| Constant currency adjusted EBITDA for the three months ended December 31, 2024 | $ | 36,627 | $ | 1,858 | $ | 12,389 | $ | (10,757 | ) | $ | 40,117 | ||||||||
| NET DEBT AND NET DEBT LEVERAGE RATIO RECONCILIATION (Unaudited) (Dollars in thousands) | |||||||
| December 31, 2024 | September 30, 2024 | ||||||
| Long-term debt, current maturities | $ | 7,260 | $ | 6,853 | |||
| Long-term debt | 801,951 | 769,614 | |||||
| Total debt | 809,211 | 776,467 | |||||
| Less: Cash and cash equivalents | (33,513 | ) | (40,816 | ) | |||
| Net Debt | $ | 775,698 | $ | 735,651 | |||
| Adjusted EBITDA (trailing 12 months) | $ | 199,698 | $ | 205,157 | |||
| Net Debt Leverage Ratio | 3.9 | 3.6 | |||||
| Matthews International Corporation Corporate Office Two NorthShore Center Pittsburgh, PA 15212-5851 Phone: (412) 442-8200 | ||||
| Contact: | Steven F. Nicola | |||
| Chief Financial Officer and Secretary | ||||
FAQ
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