Reliance Worldwide (RWC) H2 2025 earnings summary

Executive summary

• FY 2025 net sales grew 5.5% year-over-year to $1,314.7 million, with the Holman acquisition offsetting weak end markets and supporting growth.

• Adjusted EBITDA rose 1.1% to $277.7 million; adjusted net profit after tax increased 0.5% to $147.7 million, with reported net profit after tax up 13.5% to $125.0 million.

• The business demonstrated resilience through cost-saving initiatives, strong cash flow, and successful Holman integration, despite macroeconomic headwinds and new U.S. tariffs.

• Operating cash flow enabled further reduction in leverage, with net debt down by $90 million.

• Manufacturing footprint changes, SAP S/4HANA implementation, and sale of Spanish operations were completed.

Financial highlights

• Adjusted EBITDA margin was 21.1% overall and 22.3% excluding Holman; operating margin declined from 22.0% to 21.1%.

• Adjusted earnings per share increased 1.6% to US19.0 cents; reported EPS up 14.7%.

• Cash generated from operations was $271.1 million, with a cash conversion rate of 97.6%.

• Final distribution of US 5.0cps, total FY25 distributions US 10.0cps (+5%).

• Net leverage ratio improved to 1.3x net debt to EBITDA, down from 1.59x.

Outlook and guidance

• No improvement in activity levels expected in key markets for the first half of FY 2026; group sales expected to be flat or down low single digits.

• Americas first half sales expected to decline low single digits; APAC and EMEA sales to be broadly flat.

• Tariffs will disproportionately impact first half FY 2026 earnings and margins, with mitigation initiatives phased throughout the year; EBITDA impact estimated at $25–$30 million.

• Operating cash flow conversion expected above 90%; capex $25m–$30m; cost savings of $8m–$10m targeted.

• By FY 2027, tariff mitigation expected to be largely complete, with minimal ongoing impact.