H.B. Fuller Exceeds Market Expectations with Strong Q2 2025 Performance
H.B. Fuller, a leading global adhesives company, has delivered a stellar second quarter performance, exceeding market expectations and solidifying its position as a leader in the industry.
Celeste Mastin, President and CEO of H.B. Fuller, highlighted the company's disciplined execution in a highly dynamic environment during the conference call. She emphasized that the team remains nimble and focused on delivering positive organic revenue growth while managing costs effectively.
The company's strong financial performance is reflected in its EBITDA margin expansion, which highlights the success of the actions taken to drive profitability. This includes an increased focus on pricing cost savings efforts and an active portfolio shift towards higher growth, higher margin markets.
Notably, H.B. Fuller's organic sales trend remained positive during the second quarter, driven by organic pricing growth of 0.7% partially offset by slightly negative volume. From a profitability perspective, the company executed well and delivered strong results, driven in part by cost savings and targeted price actions.
Additionally, the ongoing portfolio transformation, including the strategic addition of higher-margin businesses and divestiture of lower-margin flooring business, drove most of the year-on-year margin increase in the quarter. The company grew EBITDA 5% year-on-year to $166 million and expanded EBITDA margin by 130 basis points year-on-year to 18.4%.
In its various segments, H.B. Fuller performed well across the board. In the HHC segment, organic revenue increased 1.8% year-on-year driven by both positive volume and price. Strength in medical and flexible packaging was partially offset by weakness in end-of-line packaging and beverage labeling. The EBITDA margin of 15.6% was up nearly 300 basis points versus the first quarter.
In Engineering Adhesives, organic revenue decreased 0.4% in the second quarter, with widespread strength in transportation-related end markets offset by continued weakness in solar. Excluding solar, EA organic growth was positive in the second quarter. EBITDA increased 24% in EA and EBITDA margin increased 310 basis points year-on-year to 22.9%, driven by favorable net pricing and raw material actions, cost savings and contributions from acquisitions.
Finally, in Building Adhesive Solutions, organic sales decreased 0.9% year-on-year as continued strength in roofing was offset by weakness in glass and wood tied to the residential construction market environment. EBITDA for Building Adhesive Solutions increased 5% versus the second quarter of last year, and EBITDA margin expanded 60 basis points to 16.7%, driven by favorable net pricing and raw material actions and cost savings.
