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Investing.com -- Shares of Fluidra dropped 1.6% after the company’s first quarter update, which showed revenues meeting previously reported figures at a 7% increase YoY. Despite the rise in revenue, operating expenses largely absorbed the gains in gross margin, leading to a lower-than-expected Cash EPS.
The company reported a robust performance in the first quarter, with revenues aligning with preliminary figures already announced during the Capital Markets Day, totaling €564 million. This represents a 7% YoY increase and a 5% organic growth. Management highlighted a 1% uptick in price and a 5% rise in volumes for the quarter. Geographically, North America slightly exceeded expectations by 1%, while Southern Europe met projections. However, the Rest of Europe and the Rest of the World fell short by 1% and 2%, respectively.
Adjusted EBITDA was reported to be 1% ahead of consensus, with gross profit 2% above expectations and gross margins of 57.3%, approximately 100 basis points ahead of the projected 56.3%. Adjusted EBITDA reached €131 million, marginally surpassing the consensus of €130 million, with EBITDA margins of 23.2%, around 10 basis points ahead.
Nevertheless, adjusted EBITA was 2% below expectations, with margins approximately 45 basis points below consensus, attributed to higher depreciation expenses. Cash EPS was reported at €0.35, which is 5% below consensus estimates.
Fluidrar’s management maintained its 2025 guidance, expecting revenues between €2,140 million and €2,250 million, adjusted EBITDA between €500 million and €540 million, and Cash EPS ranging from €1.33 to €1.48. They also anticipate a €50 million gross tariff impact, primarily from China, which they believe can be fully mitigated through pricing adjustments, supply chain flexibility, and cost reduction measures.
The company’s operating net working capital on a last twelve months (LTM) basis increased by 8% YoY, with the LTM ratio remaining stable. The net debt position was also stable YoY at €1.3 billion, with the LTM net debt to EBITDA ratio improving to 2.7x.
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