Sotera Health Company (SHC) Q4 2024 earnings summary

Executive summary

• Achieved 19th consecutive year of annual revenue growth, with 2024 revenue at $1.1 billion and Adjusted EBITDA margin near 50%; customer satisfaction rates remained above 80%.

• Completed capacity expansion in Sterigenics and advanced U.S. EO facility enhancements; Embedded Labs and expert advisory services posted double-digit revenue growth.

• Strengthened balance sheet by refinancing capital structure, extending maturities to 2031, and completed two secondary equity offerings.

• Maintained a global network of 62 facilities in 13 countries, serving ~5,000 customers in over 50 countries.

• Welcomed new board members and published the third annual corporate responsibility report.

Financial highlights

• Full year 2024 revenue grew 4.9% (5.4% constant currency) to $1.1 billion; Adjusted EBITDA up 3.9% (4.6% constant currency) to $549 million; Adjusted EPS was $0.70, down $0.02 year-over-year.

• Q4 2024 revenue declined 6.5% year-over-year to $290 million; Adjusted EBITDA down 8.3% to $153 million; Adjusted EPS down 9% to $0.21.

• Q4 reported net income was $12 million ($0.04 per diluted share); full year net income $44 million ($0.16 per share).

• Adjusted EBITDA margin for 2024 was 49.9%, slightly down from 50.3% in 2023.

• Strong liquidity at year-end 2024, with $279 million in cash and no borrowings under the revolving credit facility.

Outlook and guidance

• 2025 revenue expected to grow 4%-6% (constant currency), with Adjusted EBITDA up 4.5%-6.5%; Adjusted EPS guidance for 2025: $0.70-$0.76; effective tax rate 33%-35%.

• Foreign exchange expected to be a headwind of ~2.25% on revenue and ~2.5% on Adjusted EBITDA.

• CapEx expected at $190-$210 million in 2025, trending down to ~$110 million by 2027.

• Free cash flow target of $500-$600 million over the next three years.

• Net Leverage Ratio expected to decline further in 2025; no M&A activity assumed in outlook.