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H.B. Fuller Reports Fourth Quarter and Fiscal Year 2021 Results

January, 19, 2022

Revenue increased 15% year over year in Q4 and 17.5% for full year
Net income in Q4 of $65 million and diluted EPS of $1.18; adjusted EPS of $1.09
Adjusted EBITDA of $134 million increased 9% leveraging volume growth and accelerated pricing

H.B. Fuller Company (NYSE: FUL) today reported financial results for its fourth quarter and fiscal year ended Nov. 27, 2021.

Items of Note for the Fourth Quarter

  • Net and organic revenue increased 15% versus the fourth quarter of 2020.
  • Volume growth and more than $100 million of pricing realized in the quarter drove 340 basis points of sequential gross margin improvement versus the third quarter of 2021.
  • Net income increased year over year to $65 million; adjusted EBITDA increased 9% to $134 million as volume leverage and accelerated pricing offset raw material cost inflation.
  • Earnings per diluted share (EPS) was $1.18 and adjusted EPS was $1.09.
  • Strong debt paydown and EBITDA growth reduced net debt leverage to 3.3x adjusted EBITDA, compared with 4.1x at year-end 2020.

Items of Note for Fiscal 2022 Guidance

  • Double-digit organic revenue growth of 10% to 15% including strong contribution from pricing.
  • Adjusted diluted EPS of $4.00 to $4.25; up between 15% and 22% year over year.
  • Adjusted EBITDA of $515 to $535 million; up between 10% and 15% year over year.
  • Note that fiscal year 2022 has 53 weeks of activity versus the normal 52 week fiscal period.

Summary of Fourth Quarter 2021 Results

Net revenue of $897 million increased 15.4% compared with the fourth quarter of 2020. Foreign currency exchange rates favorably impacted revenue by 0.5%. Organic revenue, which excludes impacts from foreign currency translation, increased 14.9% versus last year, with double-digit organic growth in all three Global Business Units (GBUs). Organic revenue also significantly increased by more than 20% when compared with the non-COVID impacted fourth quarter of 2019.

Gross profit was $241 million. Adjusted gross profit of $244 million increased 14% versus the same period last year. Adjusted gross profit margin of 27.1% declined 40 basis points year over year reflecting elevated raw material and freight costs and improved 340 basis points sequentially versus the third quarter of 2021 driven by strong volumes and pricing benefits realized in the quarter. Selling, General and Administrative (SG&A) expense was $166 million. Adjusted SG&A expense of $155 million reflects higher travel and other investments to support growth as well as higher variable compensation related to the company’s strong fiscal 2021 performance. Adjusted SG&A as a percent of revenue remained stable at 17% in both comparable periods.

As a result of these factors, net income attributable to H.B. Fuller in the quarter was $65 million, or $1.18 per diluted share. Adjusted net income attributable to H.B. Fuller was $60 million and adjusted EPS was $1.09, compared with $56 million and $1.06 in the same period last year. A higher adjusted tax rate unfavorably impacted adjusted EPS by $0.10 in the fourth quarter of 2021 relative to the fourth quarter of 2020. Adjusted EBITDA of $134 million increased 9% compared with $123 million in the prior year.

Jim Owens, H.B. Fuller’s president and chief executive officer, said, “Our business momentum continued in the fourth quarter with 15% organic revenue growth and improved margin performance. We successfully executed on our 2021 priorities of volume growth, pricing to value and greater productivity. We drove double-digit organic revenue growth relative to both 2019 and 2020, and we further improved our net debt to EBITDA ratio.”

“H.B. Fuller’s full year results exceeded the goals we set at the beginning of the year despite extraordinary business challenges, demonstrating the resiliency of our global team. Throughout the year, we took decisive actions to deliver strong results against complex supply chain constraints and unprecedented inflationary pressures. We implemented $450M of annualized price adjustments, gained share through innovation, drove operating efficiencies, and maintained unwavering focus on supporting our customers’ success. In 2022, we are focused on enhancing our portfolio of specialized adhesives, capitalizing on the tremendous growth opportunities for advanced and sustainable solutions, and continuing to demonstrate strong cash generation and earnings power to deliver double digit organic revenue and adjusted EBITDA growth and 20% adjusted EPS growth for shareholders.”

Full Year 2021 Summary

Net revenue for fiscal 2021 of $3.3 billion increased 17.5% compared with fiscal 2020 and increased 13.1% compared with pre-COVID results in fiscal 2019. Foreign currency exchange rates favorably impacted full year revenue by 2.3% compared with fiscal 2020. Full year organic revenue increased by 15.2% year-over-year. Full year gross profit margin was 25.8%. Adjusted gross profit margin of 26.0% decreased 130 basis points driven by the impact of historic levels of raw material cost inflation and freight costs, partially offset by more than $150 million of customer price increases realized during the fiscal year. Adjusted SG&A decreased from 18.5% of revenue to 17.2% of revenue. Net income attributable to H.B. Fuller for fiscal 2021 was $175 million, or $3.23 per diluted share. Adjusted net income attributable to H.B. Fuller was $189 million, or $3.47 per diluted share, compared with $149 million, or $2.84 per diluted share, in fiscal 2020. Adjusted EBITDA for the full year of $467 million increased 15% compared with $407 million in 2020.

Other Financial Metrics

At the end of fiscal 2021, the company had cash and equivalents of $62 million and total debt equal to $1,616 million. This compares to cash and debt levels equal to $101 million and $1,774 million, respectively, at the end of fiscal 2020. Capital expenditures for fiscal year 2021 were $96 million compared with $87 million in fiscal 2020. Net working capital in 2021 increased 8% from year-end 2020 primarily as a result of increased inventory to support higher sales and higher raw material costs. Net working capital as a percent of revenue decreased from 18.7% at year-end 2020 to 17.2% at year-end 2021.

Fiscal 2022 Outlook

The company is providing financial guidance for fiscal 2022 based on current economic views and assumptions for global commercial activity. Full year organic sales are expected to increase between 10% and 15% year over year. Foreign currency exchange rates are anticipated to have an unfavorable impact of 2% to 3% on full year net revenue growth versus fiscal 2021. Management anticipates annual adjusted EPS in the range of $4.00 to $4.25, and annual adjusted EBITDA in the range of $515 to $535 million. The company’s core tax rate, excluding the impact of discrete items, is anticipated to be between 27% and 29%, full year interest expense is estimated to be between $65 million and $70 million, with average diluted share count of approximately 55 million shares. Capital investments are planned to be in the range of $100 to $110 million. The company notes that fiscal 2022 has an extra week in the fourth quarter for 53 weeks of activity versus the normal 52 week fiscal year, which is included in its financial guidance.

Conference Call

The company will hold a conference call on Jan. 20, 2022, at 9:30 a.m. CST (10:30 a.m. EST) to discuss its results. Interested parties may listen to the conference call on a live webcast. The webcast, along with a supplemental presentation, may be accessed from the company’s website at https://investors.hbfuller.com. Participants should access the webcast 10 minutes prior to the start of the call to install and test any necessary software and audio connections. A telephone replay of the conference call will be available from 12:30 p.m. CST on Jan. 20, 2022 through 10:59 p.m. CST on Jan. 27, 2022. To access the telephone replay dial (800) 585-8367 or (416) 621-4642, and enter Conference ID: 7892099.

Regulation G

The information presented in this earnings release regarding consolidated and segment organic revenue growth, operating income, adjusted gross profit, adjusted gross profit margin, adjusted selling, general and administrative expense, adjusted income before income taxes and income from equity investments, adjusted income taxes, adjusted effective tax rate, adjusted net income, adjusted diluted earnings per share and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) does not conform to U.S. generally accepted accounting principles (U.S. GAAP) and should not be construed as an alternative to the reported results determined in accordance with U.S. GAAP. Management has included this non-GAAP information to assist in understanding the operating performance of the company and its operating segments as well as the comparability of results to the results of other companies. The non-GAAP information provided may not be consistent with the methodologies used by other companies. All non-GAAP information is reconciled with reported U.S. GAAP results in the “Regulation G Reconciliation” tables in this press release with the exception of our forward-looking non-GAAP measures contained above in our Fiscal 2022 Guidance, which the company cannot reconcile to forward-looking GAAP results without unreasonable effort.

About H.B. Fuller

Since 1887, H.B. Fuller has been a leading global adhesives provider focusing on perfecting adhesives, sealants and other specialty chemical products to improve products and lives. With fiscal 2021 net revenue of $3.3 billion, H.B. Fuller’s commitment to innovation brings together people, products and processes that answer and solve some of the world's biggest challenges. Our reliable, responsive service creates lasting, rewarding connections with customers in electronics, disposable hygiene, medical, transportation, aerospace, clean energy, packaging, construction, woodworking, general industries and other consumer businesses. And, our promise to our people connects them with opportunities to innovate and thrive. For more information, visit us at https://www.hbfuller.com/.

Safe Harbor for Forward-Looking Statements

Certain statements in this press release may be considered forward-looking statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements often address expected future business and financial performance, financial condition, and other matters, and often contain words or phrases such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “opportunity,” “outlook,” “plan,” “project,” “seek,” “should,” “strategy,” "target," “will,” “will be,” “will continue,” “will likely result,” “would” and similar expressions, and variations or negatives of these words or phrases. These statements are subject to various risks and uncertainties that could cause our actual results to differ materially from those in the forward-looking statements, including but not limited to the following: the consequences of the COVID-19 outbreak and other pandemics on our operations and financial results; the substantial amount of debt we have incurred to finance our acquisition of Royal, our ability to repay or refinance our debt or to incur additional debt in the future, our need for a significant amount of cash to service and repay the debt and to pay dividends on our common stock, the effect of debt covenants that limit the discretion of management in operating the business or in paying dividends; our ability to pay dividends and to pursue growth opportunities if we continue to pay dividends according to the current dividend policy; our ability to achieve expected synergies, cost savings and operating efficiencies from our restructuring initiatives and operational improvement projects within the expected time frames or at all; our ability to effectively implement Project ONE; uncertain political and economic conditions; fluctuations in product demand; competing products and pricing; our geographic and product mix; availability and price of raw materials; disruptions to our relationships with our major customers and suppliers; failures in our information technology systems; regulatory compliance across our global footprint; trade policies and economic sanctions impacting our markets; changes in tax laws and tariffs; devaluations and other foreign exchange rate fluctuations; the impact of litigation and investigations, including for product liability and environmental matters; impairment charges on our goodwill or long-lived assets; the effect of new accounting pronouncements and accounting charges and credits; and similar matters. Many of the foregoing risks and uncertainties are, and will be, exacerbated by COVID-19 and resulting deterioration of the global business and economic environment.

Additional information about these various risks and uncertainties can be found in the “Risk Factors” section of our Form 10-K filings, and any updates to the risk factors in our Form 10-Q and 8-K filings with the SEC, but there may be other risks and uncertainties that we are unable to identify at this time or that we do not currently expect to have a material impact on the business. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. We do not undertake to update or revise any forward-looking statements, except as required by law.

H.B. FULLER COMPANY AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

In thousands, except per share amounts (unaudited)

 

 

 

Three Months Ended

 

 

 

 

Three Months Ended

 

 

 

 

 

November 27, 2021

 

 

Percent of

Net Revenue

 

 

November 28, 2020

 

 

Percent of

Net Revenue

 

Net revenue

 

$

897,424

 

 

 

100.0

%

 

$

777,640

 

 

 

100.0

%

Cost of sales

 

 

(655,965

)

 

 

(73.1

)%

 

 

(563,998

)

 

 

(72.5

)%

Gross profit

 

 

241,459

 

 

 

26.9

%

 

 

213,642

 

 

 

27.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

 

(165,789

)

 

 

(18.5

)%

 

 

(139,712

)

 

 

(18.0

)%

Other income, net

 

 

6,954

 

 

 

0.8

%

 

 

3,658

 

 

 

0.5

%

Interest expense

 

 

(18,392

)

 

 

(2.0

)%

 

 

(22,179

)

 

 

(2.9

)%

Interest income

 

 

1,767

 

 

 

0.2

%

 

 

2,656

 

 

 

0.3

%

Income before income taxes and income from equity method investments

 

 

65,999

 

 

 

7.4

%

 

 

58,065

 

 

 

7.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income taxes

 

 

(2,814

)

 

 

(0.3

)%

 

 

(19,727

)

 

 

(2.5

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from equity method investments

 

 

1,587

 

 

 

0.2

%

 

 

2,285

 

 

 

0.3

%

Net income including non-controlling interest

 

 

64,772

 

 

 

7.2

%

 

 

40,623

 

 

 

5.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to non-controlling interest

 

 

(31

)

 

 

(0.0

)%

 

 

(19

)

 

 

(0.0

)%

Net income attributable to H.B. Fuller

 

$

64,741

 

 

 

7.2

%

 

$

40,604

 

 

 

5.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic income per common share attributable to H.B. Fuller

 

$

1.22

 

 

 

 

 

 

$

0.78

 

 

 

 

 

Diluted income per common share attributable to H.B. Fuller

 

$

1.18

 

 

 

 

 

 

$

0.77

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

53,168

 

 

 

 

 

 

 

52,276

 

 

 

 

 

Diluted

 

 

54,980

 

 

 

 

 

 

 

52,879

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends declared per common share

 

$

0.168

 

 

 

 

 

 

$

0.163

 

 

 

 

 

Selected Balance Sheet Information (subject to change prior to filing of the Company's Annual Report on Form 10-K)

 

 

November 27, 2021

 

 

November 28, 2020

 

 

November 30, 2019

 

Cash & cash equivalents

 

$

61,786

 

 

$

100,534

 

 

$

112,191

 

Trade accounts receivable, net

 

 

614,645

 

 

 

514,916

 

 

 

493,181

 

Inventories

 

 

448,404

 

 

 

323,213

 

 

 

337,267

 

Trade payables

 

 

500,321

 

 

 

316,460

 

 

 

298,869

 

Total assets

 

 

4,274,530

 

 

 

4,036,704

 

 

 

3,985,734

 

Total debt

 

 

1,616,462

 

 

 

1,773,910

 

 

 

1,979,116

 

H.B. FULLER COMPANY AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

In thousands, except per share amounts (unaudited)

 

 

 

Year Ended

 

 

 

 

Year Ended

 

 

 

 

 

November 27, 2021

 

 

Percent of
Net Revenue

 

 

November 28, 2020

 

 

Percent of
Net Revenue

 

Net revenue

 

$

3,278,031

 

 

 

100.0

%

 

$

2,790,269

 

 

 

100.0

%

Cost of sales

 

 

(2,432,709

)

 

 

(74.2

)%

 

 

(2,033,620

)

 

 

(72.9

)%

Gross profit

 

 

845,322

 

 

 

25.8

%

 

 

756,649

 

 

 

27.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

 

(592,710

)

 

 

(18.1

)%

 

 

(538,332

)

 

 

(19.3

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income, net

 

 

32,855

 

 

 

1.0

%

 

 

15,398

 

 

 

0.6

%

Interest expense

 

 

(78,092

)

 

 

(2.4

)%

 

 

(86,776

)

 

 

(3.1

)%

Interest income

 

 

9,476

 

 

 

0.3

%

 

 

11,417

 

 

 

0.4

%

Income before income taxes and income from equity method investments

 

 

216,851

 

 

 

6.6

%

 

 

158,356

 

 

 

5.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income taxes

 

 

(49,176

)

 

 

(1.5

)%

 

 

(41,921

)

 

 

(1.5

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from equity method investments

 

 

7,657

 

 

 

0.2

%

 

 

7,353

 

 

 

0.3

%

Net income including non-controlling interest

 

 

175,332

 

 

 

5.3

%

 

 

123,788

 

 

 

4.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to non-controlling interest

 

 

(82

)

 

 

(0.0

)%

 

 

(69

)

 

 

(0.0

)%

Net income attributable to H.B. Fuller

 

$

175,250

 

 

 

5.3

%

 

$

123,719

 

 

 

4.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic income per common share attributable to H.B. Fuller

 

$

3.31

 

 

 

 

 

 

$

2.38

 

 

 

 

 

Diluted income per common share attributable to H.B. Fuller

 

$

3.23

 

 

 

 

 

 

$

2.36

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

52,887

 

 

 

 

 

 

 

52,039

 

 

 

 

 

Diluted

 

 

54,315

 

 

 

 

 

 

 

52,520

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends declared per common share

 

$

0.665

 

 

 

 

 

 

$

0.648

 

 

 

 

 

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands, except per share amounts (unaudited)

 

 

 

Three Months Ended

 

 

Year Ended

 

 

 

Nov 27,

 

 

Nov 28,

 

 

Nov 27,

 

 

Nov 28,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Net income attributable to H.B. Fuller

 

$

64,741

 

 

$

40,604

 

 

$

175,250

 

 

$

123,719

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition project costs

 

 

3,344

 

 

 

1,082

 

 

 

5,622

 

 

 

(502

)

Organizational realignment1

 

 

3,670

 

 

 

5,685

 

 

 

12,699

 

 

 

13,971

 

Royal restructuring and integration2

 

 

658

 

 

 

2,051

 

 

 

4,195

 

 

 

9,430

 

Tax reform

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(35

)

Project One

 

 

2,958

 

 

 

1,260

 

 

 

9,426

 

 

 

5,402

 

Other3

 

 

3,554

 

 

 

(264

)

 

 

(146

)

 

 

1,459

 

Discrete tax items4

 

 

(14,654

)

 

 

6,280

 

 

 

(9,586

)

 

 

1,152

 

Income tax effect on adjustments5

 

 

(4,510

)

 

 

(676

)

 

 

(8,871

)

 

 

(5,687

)

Adjusted net income attributable to H.B. Fuller6

 

 

59,761

 

 

 

56,022

 

 

 

188,589

 

 

 

148,909

 

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

18,406

 

 

 

19,969

 

 

 

78,175

 

 

 

84,619

 

Interest income

 

 

(1,767

)

 

 

(2,656

)

 

 

(9,476

)

 

 

(11,417

)

Income taxes

 

 

21,978

 

 

 

14,122

 

 

 

67,632

 

 

 

46,456

 

Depreciation and Amortization expense7

 

 

35,407

 

 

 

35,249

 

 

 

142,003

 

 

 

138,242

 

Adjusted EBITDA6

 

 

133,785

 

 

 

122,706

 

 

 

466,923

 

 

 

406,809

 

Diluted Shares

 

 

54,980

 

 

 

52,879

 

 

 

54,315

 

 

 

52,520

 

Adjusted diluted income per common share attributable to H.B. Fuller6

 

$

1.09

 

 

$

1.06

 

 

$

3.47

 

 

$

2.84

 

Revenue

 

$

897,424

 

 

$

777,640

 

 

$

3,278,031

 

 

$

2,790,269

 

Adjusted EBITDA margin6

 

 

14.9

%

 

 

15.8

%

 

 

14.2

%

 

 

14.6

%

1 Includes costs incurred as a direct result of the organizational realignment program, including compensation for employees supporting the program, consulting expense and operational inefficiencies related to the closure of production facilities and consolidation of business activities.

2 Costs incurred as a direct result of the Royal restructuring and integration program including compensation for employees supporting the program, consulting expense and operational inefficiencies related to the closure of production facilities and consolidation of business activities.

3 Includes costs incurred for COVID-19 testing, vaccinations, personal protective equipment and exceptional medical claims, COVID-related payroll tax benefits received in 2020, and non-cash gains related to legal entity consolidations and a tax legal settlement in Brazil.

4 Includes adjustment of ($14,654) and ($9,586) for discrete tax benefits in the three months and fiscal year ended November 27, 2021, respectively, primarily relating to an outside basis difference in the stock of certain U.S. subsidiaries classified as held for sale, the revaluation of cross-currency swap agreements due to change in the value of the Euro versus U.S. dollar, changes in valuation allowances and various foreign tax matters. Includes adjustment of $6,280 and $1,152 for discrete tax expense in the quarter and fiscal year ended November 28, 2020, respectively, primarily relating to foreign tax matters and audit settlements, partially offset by discrete tax benefit associated with the revaluation of cross-currency swap agreements due to change in the value of the Euro versus U.S. dollar.

5 The income tax effect on adjustments represents the difference between income taxes on net income before income taxes and income from equity method investments reported in accordance with U.S. GAAP and adjusted net income before income taxes and income from equity method investments.

6 Adjusted net income attributable to H.B. Fuller, adjusted diluted income per common share attributable to H.B. Fuller, adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures. Adjusted net income attributable to H.B. Fuller is defined as net income before the specific adjustments shown above. Adjusted diluted income per common share is defined as adjusted net income attributable to H.B. Fuller divided by the number of diluted common shares. Adjusted EBITDA is defined as net income before interest, income taxes, depreciation, amortization and the specific adjustments shown above. Adjusted EBITDA margin is defined as adjusted EBITDA divided by net revenue. The table above provides a reconciliation of adjusted net income attributable to H.B. Fuller, adjusted diluted income per common share attributable to H.B. Fuller, adjusted EBITDA and adjusted EBITDA margin to net income attributable to H.B. Fuller, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

7 Depreciation and amortization expense added back for EBITDA is adjusted for amounts already included in adjusted net income attributable to H.B. Fuller totaling ($145) and ($67) for the three months ended November 27, 2021 and November 28, 2020, respectively and ($1,171) and ($575) for the fiscal years ended November 27, 2021 and November 28, 2020, respectively.

H.B. FULLER COMPANY AND SUBSIDIARIES

SEGMENT FINANCIAL INFORMATION

In thousands (unaudited)

 

 

 

Three Months Ended

 

 

Year Ended

 

 

 

Nov 27,

 

 

Nov 28,

 

 

Nov 27,

 

 

Nov 28,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Net Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hygiene, Health and Consumable Adhesives

 

$

402,834

 

 

$

355,413

 

 

$

1,472,756

 

 

$

1,332,786

 

Engineering Adhesives

 

 

371,419

 

 

 

327,273

 

 

 

1,371,756

 

 

 

1,088,313

 

Construction Adhesives

 

 

123,171

 

 

 

94,954

 

 

 

433,519

 

 

 

369,170

 

Corporate unallocated

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Total H.B. Fuller

 

$

897,424

 

 

$

777,640

 

 

$

3,278,031

 

 

$

2,790,269

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Operating Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hygiene, Health and Consumable Adhesives

 

$

39,874

 

 

$

41,233

 

 

$

138,366

 

 

$

130,789

 

Engineering Adhesives

 

 

39,333

 

 

 

38,588

 

 

 

135,913

 

 

 

103,974

 

Construction Adhesives

 

 

9,174

 

 

 

1,712

 

 

 

14,148

 

 

 

11,148

 

Corporate unallocated

 

 

(12,711

)

 

 

(7,603

)

 

 

(35,815

)

 

 

(27,594

)

Total H.B. Fuller

 

$

75,670

 

 

$

73,930

 

 

$

252,612

 

 

$

218,317

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hygiene, Health and Consumable Adhesives

 

$

54,808

 

 

$

54,533

 

 

$

197,479

 

 

$

182,448

 

Engineering Adhesives

 

 

57,097

 

 

 

54,997

 

 

 

207,131

 

 

 

167,915

 

Construction Adhesives

 

 

20,105

 

 

 

11,799

 

 

 

57,890

 

 

 

51,692

 

Corporate unallocated

 

 

1,775

 

 

 

1,377

 

 

 

4,423

 

 

 

4,754

 

Total H.B. Fuller

 

$

133,785

 

 

$

122,706

 

 

$

466,923

 

 

$

406,809

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA Margin6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hygiene, Health and Consumable Adhesives

 

 

13.6

%

 

 

15.3

%

 

 

13.4

%

 

 

13.7

%

Engineering Adhesives

 

 

15.4

%

 

 

16.8

%

 

 

15.1

%

 

 

15.4

%

Construction Adhesives

 

 

16.3

%

 

 

12.4

%

 

 

13.4

%

 

 

14.0

%

Corporate unallocated

 

NMP

 

 

NMP

 

 

NMP

 

 

NMP

 

Total H.B. Fuller

 

 

14.9

%

 

 

15.8

%

 

 

14.2

%

 

 

14.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NMP = non-meaningful percentage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands, except per share amounts (unaudited)

 

 

Three Months Ended

 

 

Year Ended

 

 

 

Nov 27,

 

 

Nov 28,

 

 

Nov 27,

 

 

Nov 28,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Income before income taxes and income from equity method investments

 

$

65,999

 

 

$

58,065

 

 

$

216,851

 

 

$

158,356

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition project costs

 

 

3,344

 

 

 

1,082

 

 

 

5,622

 

 

 

(502

)

Organizational realignment

 

 

3,670

 

 

 

5,685

 

 

 

12,699

 

 

 

13,971

 

Royal restructuring and integration

 

 

658

 

 

 

2,051

 

 

 

4,195

 

 

 

9,430

 

Tax reform

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(35

)

Project One

 

 

2,958

 

 

 

1,260

 

 

 

9,426

 

 

 

5,402

 

Other3

 

 

3,554

 

 

 

(264

)

 

 

(146

)

 

 

1,459

 

Adjusted income before income taxes and income from equity method investments8

 

$

80,183

 

 

$

67,879

 

 

$

248,647

 

 

$

188,081

 

8 Adjusted income before income taxes and income from equity investments is a non-GAAP financial measure. Adjusted income before income taxes and income from equity investments is defined as income before income taxes and income from equity investments before the specific adjustments shown above. The table above provides a reconciliation of adjusted income before income taxes and income from equity investments to income before income taxes and income from equity investments, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

 

H.B. FULLER COMPANY AND SUBSIDIARIES
REGULATION G RECONCILIATION
In thousands, except per share amounts (unaudited)

 

 

 

Three Months Ended

 

 

Year Ended

 

 

 

Nov 27,

 

 

Nov 28,

 

 

Nov 27,

 

 

Nov 28,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Income Taxes

 

$

(2,814

)

 

$

(19,727

)

 

$

(49,176

)

 

$

(41,921

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition project costs

 

 

(1,064

)

 

 

(82

)

 

 

(1,559

)

 

 

340

 

Organizational realignment

 

 

(1,167

)

 

 

(435

)

 

 

(3,372

)

 

 

(2,522

)

Royal restructuring and integration

 

 

(209

)

 

 

(157

)

 

 

(1,055

)

 

 

(2,034

)

Tax reform

 

 

-

 

 

 

-

 

 

 

-

 

 

 

9

 

Project One

 

 

(940

)

 

 

(95

)

 

 

(2,492

)

 

 

(1,138

)

Other4

 

 

(15,784

)

 

 

6,374

 

 

 

(9,978

)

 

 

810

 

Adjusted income taxes9

 

$

(21,978

)

 

$

(14,122

)

 

$

(67,632

)

 

$

(46,456

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted income before income taxes and income from equity method investments

 

$

80,183

 

 

$

67,879

 

 

$

248,647

 

 

$

188,081

 

Adjusted effective income tax rate9

 

 

27.4

%

 

 

20.8

%

 

 

27.2

%

 

 

24.7

%

9 Adjusted income taxes and adjusted effective income tax rate are non-GAAP financial measures. Adjusted income taxes are defined as income taxes before the specific adjustments shown above. Adjusted effective income tax rate is defined as income taxes divided by adjusted income before income taxes and income from equity method investments. The table above provides a reconciliation of adjusted income taxes and adjusted effective income tax rate to income taxes, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

 

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands (unaudited)

 

 

 

Three Months Ended

 

 

Year Ended

 

 

 

Nov 27,

 

 

Nov 28,

 

 

Nov 27,

 

 

Nov 28,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net revenue

 

$

897,424

 

 

$

777,640

 

 

$

3,278,031

 

 

$

2,790,269

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

$

241,459

 

 

$

213,642

 

 

$

845,322

 

 

$

756,649

 

Gross profit margin

 

 

26.9

%

 

 

27.5

%

 

 

25.8

%

 

 

27.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition project costs

 

 

156

 

 

 

85

 

 

 

219

 

 

 

85

 

Organizational realignment

 

 

1,585

 

 

 

219

 

 

 

3,851

 

 

 

166

 

Royal restructuring and integration

 

 

138

 

 

 

953

 

 

 

2,100

 

 

 

3,682

 

Project ONE

 

 

-

 

 

 

-

 

 

 

(22

)

 

 

-

 

Other3

 

 

204

 

 

 

(821

)

 

 

1,839

 

 

 

443

 

Adjusted gross profit10

 

$

243,542

 

 

$

214,078

 

 

$

853,309

 

 

$

761,025

 

Adjusted gross profit margin10

 

 

27.1

%

 

 

27.5

%

 

 

26.0

%

 

 

27.3

%

10 Adjusted gross profit and adjusted gross profit margin are non-GAAP financial measures. Adjusted gross profit and adjusted gross profit margin is defined as gross profit and gross profit margin excluding the specific adjustments shown above. The table above provides a reconciliation of adjusted gross profit and gross profit margin to gross profit and gross profit margin, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands (unaudited)

 

 

 

Three Months Ended

 

 

Year Ended

 

 

 

Nov 27,

 

 

Nov 28,

 

 

Nov 27,

 

 

Nov 28,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

$

(165,789

)

 

$

(139,712

)

 

$

(592,710

)

 

$

(538,332

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition project costs

 

 

3,189

 

 

 

997

 

 

 

5,402

 

 

 

(587

)

Organizational realignment

 

 

1,420

 

 

 

5,466

 

 

 

8,239

 

 

 

13,809

 

Royal restructuring and integration

 

 

533

 

 

 

1,125

 

 

 

2,177

 

 

 

5,851

 

Tax reform

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(35

)

Project ONE

 

 

2,957

 

 

 

1,260

 

 

 

9,449

 

 

 

5,402

 

Other3

 

 

2,529

 

 

 

(1,682

)

 

 

2,561

 

 

 

(1,222

)

Adjusted selling, general and administrative expenses11

 

$

(155,161

)

 

$

(132,546

)

 

$

(564,882

)

 

$

(515,114

)

11 Adjusted selling, general and administrative expenses is a non-GAAP financial measure. Adjusted selling, general and administrative expenses is defined as selling, general and administrative expenses excluding the specific adjustments shown above. The table above provides a reconciliation of adjusted selling, general and administrative expenses to selling, general and administrative expenses, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

 

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands (unaudited)

 

 

 

Hygiene, Health

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended:

 

and Consumable

 

 

Engineering

 

 

Construction

 

 

 

 

 

 

Corporate

 

 

H.B. Fuller

 

November 27, 2021

 

Adhesives

 

 

Adhesives

 

 

Adhesives

 

 

Total

 

 

Unallocated

 

 

Consolidated

 

Net income attributable to H.B. Fuller

 

$

43,269

 

 

$

41,950

 

 

$

11,384

 

 

$

96,603

 

 

$

(31,862

)

 

$

64,741

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition project costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,344

 

 

 

3,344

 

Organizational realignment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,670

 

 

 

3,670

 

Royal Restructuring

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

658

 

 

 

658

 

Project One

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,958

 

 

 

2,958

 

Other3

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,554

 

 

 

3,554

 

Discrete tax items4

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(14,654

)

 

 

(14,654

)

Income tax effect on adjustments5

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(4,510

)

 

 

(4,510

)

Adjusted net income attributable to H.B. Fuller6

 

 

43,269

 

 

 

41,950

 

 

 

11,384

 

 

 

96,603

 

 

 

(36,842

)

 

 

59,761

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

18,406

 

 

 

18,406

 

Interest income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,767

)

 

 

(1,767

)

Income taxes

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

21,978

 

 

 

21,978

 

Depreciation and amortization expense

 

 

11,539

 

 

 

15,147

 

 

 

8,721

 

 

 

35,407

 

 

 

-

 

 

 

35,407

 

Adjusted EBITDA6

 

$

54,808

 

 

$

57,097

 

 

$

20,105

 

 

$

132,010

 

 

$

1,775

 

 

$

133,785

 

Revenue

 

$

402,834

 

 

$

371,419

 

 

$

123,171

 

 

$

897,424

 

 

 

-

 

 

$

897,424

 

Adjusted EBITDA Margin6

 

 

13.6

%

 

 

15.4

%

 

 

16.3

%

 

 

14.7

%

 

NMP

 

 

 

14.9

%

 

 

Hygiene, Health

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

and Consumable

 

 

Engineering

 

 

Construction

 

 

 

 

 

 

Corporate

 

 

H.B. Fuller

 

November 27, 2021

 

Adhesives

 

 

Adhesives

 

 

Adhesives

 

 

Total

 

 

Unallocated

 

 

Consolidated

 

Net income attributable to H.B. Fuller

 

$

151,560

 

 

$

146,050

 

 

$

22,887

 

 

$

320,497

 

 

$

(145,247

)

 

$

175,250

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition project costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,622

 

 

 

5,622

 

Organizational realignment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,699

 

 

 

12,699

 

Royal Restructuring

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,195

 

 

 

4,195

 

Project One

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

9,426

 

 

 

9,426

 

Other3

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(146

)

 

 

(146

)

Discrete tax items4

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(9,586

)

 

 

(9,586

)

Income tax effect on adjustments5

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(8,871

)

 

 

(8,871

)

Adjusted net income attributable to H.B. Fuller6

 

 

151,560

 

 

 

146,050

 

 

 

22,887

 

 

 

320,497

 

 

 

(131,908

)

 

 

188,589

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

78,175

 

 

 

78,175

 

Interest income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(9,476

)

 

 

(9,476

)

Income taxes

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

67,632

 

 

 

67,632

 

Depreciation and amortization expense

 

 

45,919

 

 

 

61,081

 

 

 

35,003

 

 

 

142,003

 

 

 

-

 

 

 

142,003

 

Adjusted EBITDA6

 

$

197,479

 

 

$

207,131

 

 

$

57,890

 

 

$

462,500

 

 

$

4,423

 

 

$

466,923

 

Revenue

 

 

1,472,756

 

 

 

1,371,756

 

 

 

433,519

 

 

 

3,278,031

 

 

 

-

 

 

 

3,278,031

 

Adjusted EBITDA Margin6

 

 

13.4

%

 

 

15.1

%

 

 

13.4

%

 

 

14.1

%

 

NMP

 

 

 

14.2

%

Note: Adjusted EBITDA is a non-GAAP financial measure. The table above provides a reconciliation of adjusted EBITDA for each segment to net income attributable to H.B. Fuller for each segment, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

 

NMP = Non-meaningful percentage

 

H.B. FULLER COMPANY AND SUBSIDIARIES

REGULATION G RECONCILIATION

In thousands (unaudited)

 

 

Hygiene, Health

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended:

 

and Consumable

 

 

Engineering

 

 

Construction

 

 

 

 

 

 

Corporate

 

 

H.B. Fuller

 

November 28, 2020

 

Adhesives

 

 

Adhesives

 

 

Adhesives

 

 

Total

 

 

Unallocated

 

 

Consolidated

 

Net income attributable to H.B. Fuller

 

$

43,140

 

 

$

40,046

 

 

$

2,894

 

 

$

86,080

 

 

$

(45,476

)

 

$

40,604

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition project costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,082

 

 

 

1,082

 

Organizational realignment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,685

 

 

 

5,685

 

Royal Restructuring

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,051

 

 

 

2,051

 

Project One

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,260

 

 

 

1,260

 

Other3

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(264

)

 

 

(264

)

Discrete tax items4

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

6,280

 

 

 

6,280

 

Income tax effect on adjustments5

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(676

)

 

 

(676

)

Adjusted net income attributable to H.B. Fuller6

 

 

43,140

 

 

 

40,046

 

 

 

2,894

 

 

 

86,080

 

 

 

(30,058

)

 

 

56,022

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

19,969

 

 

 

19,969

 

Interest income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,656

)

 

 

(2,656

)

Income taxes

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

14,122

 

 

 

14,122

 

Depreciation and amortization expense

 

 

11,393

 

 

 

14,951

 

 

 

8,905

 

 

 

35,249

 

 

 

-

 

 

 

35,249

 

Adjusted EBITDA6

 

$

54,533

 

 

$

54,997

 

 

$

11,799

 

 

$

121,329

 

 

$

1,377

 

 

$

122,706

 

Revenue

 

$

355,413

 

 

$

327,273

 

 

$

94,954

 

 

$

777,640

 

 

 

-

 

 

$

777,640

 

Adjusted EBITDA Margin6

 

 

15.3

%

 

 

16.8

%

 

 

12.4

%

 

 

15.6

%

 

NMP

 

 

 

15.8

%

 

 

Hygiene, Health

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

and Consumable

 

 

Engineering

 

 

Construction

 

 

 

 

 

 

Corporate

 

 

H.B. Fuller

 

November 28, 2020

 

Adhesives

 

 

Adhesives

 

 

Adhesives

 

 

Total

 

 

Unallocated

 

 

Consolidated

 

Net income attributable to H.B. Fuller

 

$

138,119

 

 

$

109,813

 

 

$

15,881

 

 

$

263,813

 

 

$

(140,094

)

 

$

123,719

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition project costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(502

)

 

 

(502

)

Organizational realignment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,971

 

 

 

13,971

 

Royal Restructuring

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

9,430

 

 

 

9,430

 

Tax reform

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(35

)

 

 

(35

)

Project One

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,402

 

 

 

5,402

 

Other3

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,459

 

 

 

1,459

 

Discrete tax items4

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,152

 

 

 

1,152

 

Income tax effect on adjustments5

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(5,687

)

 

 

(5,687

)

Adjusted net income attributable to H.B. Fuller6

 

 

138,119

 

 

 

109,813

 

 

 

15,881

 

 

 

263,813

 

 

 

(114,904

)

 

 

148,909

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

84,619

 

 

 

84,619

 

Interest income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(11,417

)

 

 

(11,417

)

Income taxes

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

46,456

 

 

 

46,456

 

Depreciation and amortization expense

 

 

44,329

 

 

 

58,102

 

 

 

35,811

 

 

 

138,242

 

 

 

-

 

 

 

138,242

 

Adjusted EBITDA6

 

$

182,448

 

 

$

167,915

 

 

$

51,692

 

 

$

402,055

 

 

$

4,754

 

 

$

406,809

 

Revenue

 

$

1,332,786

 

 

$

1,088,313

 

 

$

369,170

 

 

$

2,790,269

 

 

 

-

 

 

$

2,790,269

 

Adjusted EBITDA Margin6

 

 

13.7

%

 

 

15.4

%

 

 

14.0

%

 

 

14.4

%

 

NMP

 

 

 

14.6

%

Note: Adjusted EBITDA is a non-GAAP financial measure. The table above provides a reconciliation of adjusted EBITDA for each segment to net income attributable to H.B. Fuller for each segment, the most directly comparable financial measure determined and reported in accordance with U.S. GAAP.

 

NMP = Non-meaningful percentage

 

H.B. FULLER COMPANY AND SUBSIDIARIES

SEGMENT FINANCIAL INFORMATION

NET REVENUE GROWTH (DECLINE)
(unaudited)

 

 

 

Three Months Ended

 

 

Year Ended

 

 

 

November 27, 2021

 

 

November 27, 2021

 

Price

 

 

13.5

%

 

 

5.6

%

Volume

 

 

1.4

%

 

 

9.6

%

Organic Growth12

 

 

14.9

%

 

 

15.2

%

F/X

 

 

0.5

%

 

 

2.3

%

Total H.B. Fuller Net Revenue Growth

 

 

15.4

%

 

 

17.5

%

Revenue growth versus 2020

 

Three Months Ended

 

 

Year Ended

 

 

 

November 27, 2021

 

 

November 27, 2021

 

 

 

Net Revenue

 

 

F/X

 

 

Organic Growth12

 

 

Net Revenue

 

 

F/X

 

 

Organic

Growth12

 

Hygiene, Health and Consumable Adhesives

 

 

13.3

%

 

 

0.5

%

 

 

12.8

%

 

 

10.5

%

 

 

1.3

%

 

 

9.2

%

Engineering Adhesives

 

 

13.5

%

 

 

0.6

%

 

 

12.9

%

 

 

26.1

%

 

 

3.9

%

 

 

22.2

%

Construction Adhesives

 

 

29.7

%

 

 

0.4

%

 

 

29.3

%

 

 

17.4

%

 

 

1.3

%

 

 

16.1

%

Total H.B. Fuller

 

 

15.4

%

 

 

0.5

%

 

 

14.9

%

 

 

17.5

%

 

 

2.3

%

 

 

15.2

%

Revenue growth versus 2019

 

Three Months Ended

 

 

Year Ended

 

 

 

November 27, 2021

 

 

November 27, 2021

 

 

 

Net Revenue

 

 

F/X

 

 

Organic

Growth12

 

 

Net Revenue

 

 

F/X and M&A

 

 

Organic

Growth12

 

Hygiene, Health and Consumable Adhesives

 

 

17.8

%

 

 

(0.6

)%

 

 

18.4

%

 

 

10.8

%

 

 

(1.7

)%

 

 

12.5

%

Engineering Adhesives

 

 

22.4

%

 

 

3.0

%

 

 

19.4

%

 

 

18.3

%

 

 

3.1

%

 

 

15.2

%

Construction Adhesives

 

 

31.7

%

 

 

1.0

%

 

 

30.7

%

 

 

9.3

%

 

 

1.0

%

 

 

8.3

%

Total H.B. Fuller

 

 

21.5

%

 

 

1.1

%

 

 

20.4

%

 

 

13.1

%

 

 

0.1

%

 

 

13.0

%

12 We use the term “organic revenue” to refer to net revenue, excluding the effect of foreign currency changes and acquisitions and divestitures. Organic growth reflects adjustments for the impact of period-over-period changes in foreign currency exchange rates on revenues and the revenues associated with acquisitions and divestitures.

CONSOLIDATED BALANCE SHEETS

H.B. FULLER COMPANY AND SUBSIDIARIES

(In thousands, except share and per share amounts)

 

 

 

November 27,

 

 

November 28,

 

 

 

2021

 

 

2020

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

61,786

 

 

$

100,534

 

Trade receivables, net

 

 

614,645

 

 

 

514,916

 

Inventories

 

 

448,404

 

 

 

323,213

 

Other current assets

 

 

96,335

 

 

 

81,113

 

Total current assets

 

 

1,221,170

 

 

 

1,019,776

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment, net

 

 

695,367

 

 

 

670,744

 

Goodwill

 

 

1,298,845

 

 

 

1,312,003

 

Other intangibles, net

 

 

687,075

 

 

 

755,968

 

Other assets

 

 

372,073

 

 

 

278,213

 

Total assets

 

$

4,274,530

 

 

$

4,036,704

 

 

 

 

 

 

 

 

 

 

Liabilities, non-controlling interest and total equity

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Notes payable

 

$

24,983

 

 

$

16,925

 

Current maturities of long-term debt

 

 

-

 

 

 

-

 

Trade payables

 

 

500,321

 

 

 

316,460

 

Accrued compensation

 

 

109,542

 

 

 

83,598

 

Income taxes payable

 

 

15,943

 

 

 

29,173

 

Other accrued expenses

 

 

86,061

 

 

 

83,976

 

Total current liabilities

 

 

736,850

 

 

 

530,132

 

 

 

 

 

 

 

 

 

 

Long-term debt, net of current maturities

 

 

1,591,479

 

 

 

1,756,985

 

Accrued pension liabilities

 

 

71,651

 

 

 

88,806

 

Other liabilities

 

 

263,333

 

 

 

278,919

 

Total liabilities

 

$

2,663,313

 

 

$

2,654,842

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

H.B. Fuller stockholders' equity:

 

 

 

 

 

 

 

 

Preferred stock (no shares outstanding) Shares authorized – 10,045,900

 

 

-

 

 

 

-

 

Common stock, par value $1.00 per share, Shares authorized – 160,000,000, Shares outstanding – 52,777,753 and 51,906,663 for 2021 and 2020, respectively

 

$

52,778

 

 

$

51,907

 

Additional paid-in capital

 

 

213,637

 

 

 

157,867

 

Retained earnings

 

 

1,614,458

 

 

 

1,474,406

 

Accumulated other comprehensive loss

 

 

(270,247

)

 

 

(302,859

)

Total H.B. Fuller stockholders' equity

 

 

1,610,626

 

 

 

1,381,321

 

Non-controlling interest

 

 

591

 

 

 

541

 

Total equity

 

 

1,611,217

 

 

 

1,381,862

 

Total liabilities, non-controlling interest and total equity

 

$

4,274,530

 

 

$

4,036,704

 

CONSOLIDATED STATEMENTS of CASH FLOWS

H.B. FULLER COMPANY AND SUBSIDIARIES

(In thousands)

 

 

 

Fiscal Years

 

 

 

November 27,

 

 

November 28,

 

 

November 30,

 

 

 

2021

 

 

2020

 

 

2019

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

Net income including non-controlling interest

 

$

175,332

 

 

$

123,788

 

 

$

130,844

 

Adjustments to reconcile net income including non-controlling interest to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation

 

 

72,106

 

 

 

68,226

 

 

 

67,115

 

Amortization

 

 

71,068

 

 

 

70,591

 

 

 

74,091

 

Deferred income taxes

 

 

2,335

 

 

 

(24,730

)

 

 

(29,028

)

Income from equity method investments, net of dividends received

 

 

2,776

 

 

 

375

 

 

 

(39

)

Loss (gain) on sale of assets

 

 

648

 

 

 

86

 

 

 

(24,104

)

Share-based compensation

 

 

22,366

 

 

 

16,914

 

 

 

24,003

 

Pension and other postretirement benefit plan contributions

 

 

(3,840

)

 

 

(5,479

)

 

 

(8,063

)

Pension and other postretirement benefit plan income

 

 

(28,662

)

 

 

(14,763

)

 

 

(11,300

)

Mark to market related to contingent consideration liabilities

 

 

2,300

 

 

 

800

 

 

 

-

 

Change in assets and liabilities, net of effects of acquisitions:

 

 

 

 

 

 

 

 

 

 

 

 

Trade receivables, net

 

 

(124,849

)

 

 

(14,842

)

 

 

(25,632

)

Inventories

 

 

(135,351

)

 

 

15,708

 

 

 

19,584

 

Other assets

 

 

(79,097

)

 

 

38,412

 

 

 

(18,316

)

Trade payables

 

 

176,337

 

 

 

23,130

 

 

 

11,553

 

Accrued compensation

 

 

27,741

 

 

 

2,588

 

 

 

1,342

 

Other accrued expenses

 

 

1,186

 

 

 

16,361

 

 

 

(1,882

)

Income taxes payable

 

 

(4,137

)

 

 

5,511

 

 

 

21,043

 

Other liabilities

 

 

(73,508

)

 

 

24,566

 

 

 

448

 

Other

 

 

108,566

 

 

 

(15,683

)

 

 

37,518

 

Net cash provided by operating activities

 

 

213,317

 

 

 

331,559

 

 

 

269,177

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

Purchased property, plant and equipment

 

 

(96,089

)

 

 

(87,288

)

 

 

(61,982

)

Purchased businesses, net of cash acquired

 

 

(5,445

)

 

 

(9,500

)

 

 

(8,292

)

Purchased business assets

 

 

-

 

 

 

(5,623

)

 

 

-

 

Purchased business remaining equity

 

 

-

 

 

 

-

 

 

 

(9,870

)

Proceeds from sale of property, plant and equipment

 

 

2,896

 

 

 

1,506

 

 

 

11,133

 

Proceeds from sale of business

 

 

-

 

 

 

-

 

 

 

70,293

 

Cash received from government grant

 

 

5,800

 

 

 

-

 

 

 

8,881

 

Cash outflow related to government grant

 

 

(1,822

)

 

 

(8,555

)

 

 

(2,758

)

Net cash (used in) provided by investing activities

 

 

(94,660

)

 

 

(109,460

)

 

 

7,405

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from issuance of long-term debt

 

 

-

 

 

 

300,000

 

 

 

-

 

Repayment of long-term debt

 

 

(156,500

)

 

 

(518,000

)

 

 

(288,600

)

Net proceeds from (payments on) notes payable

 

 

9,346

 

 

 

4,128

 

 

 

1,662

 

Dividends paid

 

 

(34,859

)

 

 

(33,461

)

 

 

(32,357

)

Contingent consideration payment

 

 

(1,700

)

 

 

(767

)

 

 

(3,610

)

Proceeds from stock options exercised

 

 

32,325

 

 

 

12,321

 

 

 

10,885

 

Repurchases of common stock

 

 

(2,682

)

 

 

(3,432

)

 

 

(3,026

)

Net cash used in financing activities

 

 

(154,070

)

 

 

(239,211

)

 

 

(315,046

)

Effect of exchange rate changes on cash and cash equivalents

 

 

(3,335

)

 

 

5,455

 

 

 

(138

)

Net change in cash and cash equivalents

 

 

(38,748

)

 

 

(11,657

)

 

 

(38,602

)

Cash and cash equivalents at beginning of year

 

 

100,534

 

 

 

112,191

 

 

 

150,793

 

Cash and cash equivalents at end of year

 

$

61,786

 

 

$

100,534

 

 

$

112,191

 

 

Barbara Doyle
Investor Relations contact
651-236-5023

Source: H.B. Fuller Company

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