US HB Fuller’s Q1 net income falls on Forbo integration costs

26 March 2014 22:29  [Source: ICIS news]

HOUSTON (ICIS)--HB Fuller’s Q1 net income fell by more than 29% year over year due primarily to increased special charges, the US-based sealants and specialty chemical producer said on Wednesday.

Net income for the quarter ended 1 March was $14.6m, down from $20.7m in Q1 2013.

HB Fuller attributed the year-on-year jump in special charges – to $11.7m in Q1 2014 from $5.3m in Q1 2013 – to costs from integrating the Forbo adhesive business, which the company acquired in 2012.

At the beginning of the integration, HB Fuller estimated its costs would total $125m, but the company said in a news release on Wednesday that it expects costs to exceed that “by an immaterial amount, primarily due to delays in completing the European portion of the project”.

Net revenue for Q1 2014 was up 1.3% year over year to $486m from $480 in the year-prior period.

Said CEO Jim Owens: "Organic revenue growth of 2% [in the first quarter] was below last quarter's results, with strong revenue in Asia and Construction Products offset by weak revenue in Europe and slower than expected organic sales growth in the Americas through December, January and February. We are pleased with our ability to adapt and deliver bottom line results in the quarter as we manage significant internal projects and numerous external factors."

By: Jeremy Pafford
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