Matthews International Q4 Earnings Beat Estimates, Revenues Down Y/Y

Matthews International Corporation MATW reported the fourth-quarter 2024 result, wherein both top and bottom lines surpassed the Zacks Consensus Estimate. However, both metrics declined year over year.The performance was impacted by continued customer delays in MATW’s energy business. Nonetheless, the company’s cost-cutting program did provide some cushion.MATW’s Quarterly Performance: Key InsightsMatthews International posted adjusted quarterly earnings of 55 cents per share, which beat the Zacks Consensus Estimate of 41 cents. The same decreased 42.7% from earnings of 96 cents per share reported in the prior-year period.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Matthews International Corporation Price, Consensus and EPS Surprise Matthews International Corporation price-consensus-eps-surprise-chart | Matthews International Corporation QuoteThe company reported consolidated net sales of $446.7 million, which beat the Zacks Consensus Estimate of $439 million. However, the metric decreased 7% from $480.2 million posted in the year-ago period.Gross profit fell 22.2% year over year to $117.3 million. We note that the gross margin contracted 510 basis points (bps) to 26.3%.Matthews International reported an adjusted EBITDA of $58.1 million, down 6.1% from the prior-year quarter. However, the adjusted EBITDA margin increased 10 bps to 13%.MATW’s Segment Wise Performance DetailsRevenues for the Memorialization decreased 3.9% year over year to $196.8 million. Despite lower unit volumes, caused by a decline in the number of U.S. deaths compared with the prior year, the segment's adjusted EBITDA grew 9.8% to $40.5 million. Ongoing cost containment initiatives, coupled with improved price realization, aided improved operating margins.Industrial Technologies revenues decreased 19% to $113.9 million, primarily due to ongoing customer delays in the energy business. The quarter also indicated continued softness in the warehouse automation market. However, improving order rates implies the potential for a strong recovery in the next fiscal year. The segment’s adjusted EBITDA declined 32.4% to $15.9 million.SGK Brand Solutions revenues inched up 0.9% to $135.9 million, primarily indicating improved pricing to offset inflationary cost increases, elevated sales for the merchandising and private label businesses, and expansion in the Asia-Pacific market. The segment’s adjusted EBITDA fell 1.2% to $17.3 million.MATW’s Financial Health SnapshotMatthews International ended the reported quarter with cash and cash equivalents of $40.8 million, long-term debt, current maturities of $6.9 million and stockholders’ equity of $437.2 million. During the fourth quarter of fiscal 2024, MATW reduced outstanding debt by $53.8 million. For the year ended Sept. 30, 2024, net cash provided by operating activities was $79.3 million.Recently, the company’s board of directors raised the quarterly dividend by one cent to 25 cents per share. This increase marks the 31st consecutive annual dividend increase. The dividend payment is scheduled for Dec. 16, 2024, for its shareholders on record as of Dec. 2.MATW’s 2025 OutlookFor fiscal 2025, Matthews International faces continued uncertainty regarding project timing in the Industrial Technologies segment, particularly within the energy business. While the company anticipates completing deliveries during the year, it did not provide any quarterly timing. However, it believes that the cost reduction programs should mitigate some of the impacts.MATW anticipates another strong performance from the Memorialization business in fiscal 2025, as U.S. death rates have largely normalized following the COVID-19 pandemic. The company expects continued growth in sales of cremation-related products.Management foresees sustained progress in the SGK Brand Solutions segment, indicating improving conditions in the U.S. market, greater stability in Europe and further expansion in the Asia-Pacific region.In the Industrial Technologies segment, the product identification business is expected to grow next year and the company anticipates reaping benefits from the launch of a new printhead product, scheduled for the latter half of the fiscal year. Additionally, improving order rates for warehouse automation solutions should support the recovery in this business.Considering aforementioned factors, MATW remains cautious and guided adjusted EBITDA for fiscal 2025 in the range of $205 million to $215 million compared with $205.2 million reported in fiscal 2024.The Zacks Rank #5 (Strong Sell) stock has lost 1.2% in the three months against the industry’s growth of 9.5%.Image Source: Zacks Investment ResearchStocks to ConsiderCarriage Services, Inc. CSV provides funeral and cemetery services, and merchandise in the United States, currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for Carriage Services’ current fiscal-year sales and earnings indicates growth of 5.2% and 14.2%, respectively, from the year-ago quarter’s reported numbers. CSV has a trailing four-quarter average earnings surprise of 36.3%. Abercrombie & Fitch Co. ANF, through its subsidiaries, operates as an omnichannel retailer, which offers an assortment of apparel, personal care products and accessories for men, women and kids, currently carrying a Zacks Rank #2 (Buy). ANF has a trailing four-quarter average earnings surprise of 28%.The consensus estimate for Abercrombie’s current financial-year sales and earnings indicates growth of 13.4% and 64.8%, respectively, from the year-ago period’s reported figures.Nordstrom, Inc. JWN, a fashion retailer, provides apparels, shoes, beauty, accessories and home goods for women, men, young adults and children, currently carrying a Zacks Rank #2. JWN delivered an earnings surprise of 29.7% in the last reported quarter.The Zacks Consensus Estimate for Nordstrom’s current financial-year sales indicates growth of 0.9% from the year-ago period’s reported figures.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Abercrombie & Fitch Company (ANF): Free Stock Analysis Report Nordstrom, Inc. (JWN): Free Stock Analysis Report Carriage Services, Inc. (CSV): Free Stock Analysis Report Matthews International Corporation (MATW): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks