iFabrick (IFA) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue reached CAD 7.1 million, up 5% year-over-year, marking a record first quarter driven by Intelligent Fabrics and new programs in Canada and the US, despite market headwinds and tariffs.

• Intelligent Fabrics division revenue grew 25% to CAD 5.8 million, while Intimate Apparel division revenue fell 40% to CAD 1.3 million due to lack of new programs and seasonal weakness.

• Gross margin declined to 39% from 44% last year, attributed to a higher mix of lower-margin products and reduced Intimate Apparel sales.

• Adjusted EBITDA dropped to $300,000 from $800,000 year-over-year, reflecting lower margins and higher expenses, including regulatory and leaching study costs.

• Net earnings after tax attributable to shareholders fell to $88,458 ($0.003/share) from $550,596 ($0.018/share) year-over-year.

Financial highlights

• Revenue increased by CAD 300,000 year-over-year, with Intelligent Fabrics offsetting Intimate Apparel declines.

• Gross margin fell to 39% from 44% due to product mix shift.

• Adjusted EBITDA decreased to $300,000 from $800,000 year-over-year.

• SG&A expenses increased 13% to $2.4M, mainly from regulatory and study costs, and investments in personnel and marketing.

• Cash balance rose by CAD 3.6 million, ending at CAD 5.6 million, supported by strong collections.

Outlook and guidance

• Management expects double-digit revenue growth for 2025, with new programs and product segments contributing.

• U.S. revenue is expected to grow and eventually surpass Canadian revenue as new programs scale.

• No slowdown in customer orders for 2026; order book remains strong.

• Gross margin target remains around 40% for the year.

• U.S. tariff increases on Chinese imports (now 30%) are not expected to significantly impact 2025 earnings, but further hikes could affect future U.S. revenues and margins.