Richards Group (RIC) investor relations material

Executive summary

• Healthcare segment delivered strong growth, offsetting declines in packaging due to global headwinds and US tariffs, with new OEM product launches and distribution outperformance in pharmacy, dental, and surgical verticals.

• Packaging revenues fell sharply, especially in the US, due to higher input costs, freight, and weak consumer sentiment, but gross margins improved by focusing on smaller, more profitable customers.

• Significant investments were made in marketing, personnel, and technology to support new product launches and CRM implementation.

Financial highlights

• Revenue increased 5.0% year-over-year to $105.7M, driven by $14.6M (32.7%) healthcare growth, offset by a $9.6M (17.2%) decline in packaging.

• Net income rose to $5.97M from $5.11M, with EPS up to $0.53 (basic) from $0.47, aided by lower non-recurring costs.

• Adjusted EBITDAAL remained flat at $12.0M, with healthcare up $3.3M (61.0%) and packaging down $3.1M (41.6%).

• Gross profit margin improved to 43.5% from 40.4% year-over-year.

• Free cash flow conversion ratio declined to 63% from 81% due to higher maintenance capital, taxes, and interest.

Outlook and guidance

• Management expects continued healthcare growth, both organic and via acquisitions, while packaging remains challenged by macroeconomic factors.

• Financial performance is expected to support ongoing working capital, capital expenditures, and dividends through 2026.

• Maintenance capital for 2026 is projected at $4.1M, with continued IT and equipment investments.