Sales at H.B. Fuller jumped 42 percent in the company’s first quarter thanks to the acquisition last fall of Royal Adhesives & Sealants.
Revenue was $713 million for the quarter that ended March 3, up from $503 million in the same period a year ago. If Royal had been part of the company in 2017, revenue would have increased 11 percent. Net income for St. Paul-based Fuller was $47.7 million, or 92 cents a share — more than triple what the company earned in the first quarter last year.
Adjusted earnings were 35 cents a share, just beating the consensus estimate of 34 cents by analysts polled by Yahoo Finance.
The $1.6 billion acquisition of Royal, a specialty adhesives company based in South Bend, Ind., is the largest in Fuller’s history and the company expects it will take three years to fully integrate the two companies. In early March, Fuller announced an integration plan for the new Royal business that is expected to add $35 million to $40 million in pretax charges over the next three years and deliver $35 million in annual cost synergies by 2020. The plan includes the closing of two small production plants.
For the full fiscal year ahead Fuller is maintaining its outlook and predicting adjusted earnings per share in the $3.10 to $3.40 range. Shares of H.B. Fuller closed Thursday at $49.73, up $1.04. For the year, shares are down 7.9 percent.
Jim Owens, the company’s president and chief executive, cited several strengths in the quarter: double-digit growth in the engineering adhesives segment, improved pricing and raw material savings from the Royal integration.