Worthington Enterprises (WOR) Q1 2025 earnings summary

Executive summary

• Q1 FY2025 net sales were $257.3M, down 17.5% year-over-year, mainly due to SES segment deconsolidation and lower Building Products volume.

• Adjusted EBITDA from continuing operations was $48.4M (18.8% margin), down from $65.9M YoY; adjusted EPS was $0.50, down from $0.75.

• Net earnings from continuing operations were $24.3M ($0.48 per share), compared to $26.8M ($0.54) in Q1 FY2024.

• Completed Hexagon Ragasco acquisition for $100.3M–$102.2M, expanding Building Products; integration and SES JV launch progressed.

• 150,000 shares repurchased for $6.8M–$7M; $0.17/share dividend declared for December 2024.

Financial highlights

• Net sales were $257M, down from $312M YoY; adjusted EBITDA was $48M, down from $66M; gross profit was $62M, with gross margin up to 24.3%.

• Adjusted EPS was $0.50, down from $0.75; GAAP EPS from continuing operations was $0.48.

• Free cash flow was $32M; net cash from operating activities was $41.1M; capex was $9.6M–$10M.

• Net debt to trailing EBITDA leverage ratio at 0.5x–1.3x; ended quarter with $300M debt and $179M cash.

• 110% cash conversion rate on equity income from unconsolidated JVs.

Outlook and guidance

• Management maintains a positive long-term outlook, citing strong brands, secular trends, and anticipated demand normalization.

• Lower interest rates expected to benefit demand, though near-term headwinds from inflation and high mortgage rates persist.

• Focus remains on organic growth, targeted M&A, and disciplined capital return.