H.B. Fuller’s acquisition of the Forbo Group’s industrial adhesives business was completed on March 5, 2012. In 2011, the acquired business generated net revenue of approximately $580 million, pre-tax operating income of approximately $25 million, and EBITDA of approximately $35 million. The acquisition was completed after the close of the company’s first quarter of the 2012 fiscal year and, therefore, will be reported in the company’s financial statements beginning with the second quarter of 2012.
Net income for the first quarter of 2012 was $15.3 million versus $14.4 million in last year’s first quarter. Net revenue for the first quarter of 2012 was $375.3 million, up 10.5 percent versus the first quarter of 2011. Higher average selling prices and higher volume positively impacted net revenue growth by 8.7 and 2.3 percentage points, respectively said the company.
At the end of the first quarter of 2012, the company had cash totaling $150 million and total debt of $228 million. This compares to fourth quarter levels of $156 million and $232 million, respectively.
“We are off to another solid start to our fiscal year,” said Jim Owens, H. B. Fuller president and chief executive officer. “Our teams around the world are winning with customers as we posted our ninth consecutive quarter of organic revenue growth, which included the best volume performance since the third quarter of 2010. The improvement in gross margin once again demonstrates the value we are delivering to our customers and the discipline and execution capability of the organization. Our core business is running well as we begin the process of integrating the Forbo industrial adhesives business.
“Our work to integrate the Forbo acquisition is moving quickly,” Owens said. “At the end of the second quarter we plan to provide more complete guidance regarding the impact of the acquisition on 2012 results. We believe our initial synergy estimate of $50 million of annualized pre-tax savings within two years is still valid and we expect the acquired business will generate between $0.05 and $0.15 per diluted share of incremental net income in the 2012 fiscal year, excluding special charges.”