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DENVER , April 30, 2025 /PRNewswire/ -- Gates Industrial Corporation plc (NYSE: GTES ), a leading global provider of application-specific fluid power and power transmission solutions, today reported results for the first quarter ended March 29, 2025 . First-Quarter 2025 Financial Summary First-quarter net sales of $847.6 million , down 1.
7% compared to the prior-year period, including core revenue growth of 1.4%. Net income attributable to shareholders of $62.
0 million , or $0.24 per diluted share. Adjusted Net Income per diluted share of $0.
36 . Net income from continuing operations of $68.6 million , or a margin of 8.
1%. Adjusted EBITDA of $187.3 million , or a margin of 22.
1%. Reiterating 2025 full-year guidance. Ivo Jurek , Gates Industrial's Chief Executive Officer, commented, "In the first quarter, we grew our volume company-wide supported by strong growth in our Auto Replacement and Personal Mobility end markets.
Also, our gross margin increased nicely year-over-year." Jurek continued, "We are reiterating our full year guidance. While the business environment has become more uncertain since the start of the year, I am confident in our competitive position.
Our manufacturing footprint is largely 'in-region, for-region', which we believe provides us with advantages relative to our primary competition. We continue to broaden our product portfolio, expand our presence in growth markets and provide differentiated service levels to our customers. I appreciate the diligence and focus of the global Gates team as we manage through the current macroeconomic environment.
" Power Transmission Segment Results Fluid Power Segment Results 2025 Guidance The Company is maintaining its full year financial guidance for 2025. Specifically, the company anticipates the following: Core sales growth in the range of (0.5%) to +3.
5% year-over-year Adjusted EBITDA of $735 million to $795 million Adjusted Earnings Per Share of $1.36 to $1.52 Capital Expenditures of approximately $120 million Free Cash Flow conversion exceeding 90% Share-based metrics in the Company's guidance do not include the effect of any potential share repurchases.
Because GAAP financial measures on a forward-looking basis are not accessible, and reconciling information is not available without unreasonable effort, we have not provided reconciliations for forward-looking non-GAAP measures, including expected Core Sales Growth, Adjusted EBITDA, Adjusted Earnings per Share and Free Cash Flow conversion for 2025. For the same reasons, we are unable to address the probable significance of the unavailable information, which could be material to future results. Conference Call and Webcast Gates Industrial Corporation plc will host a conference call today at 9:00 a.
m. Eastern Time to discuss the Company's financial results. The live webcast of the conference call and accompanying presentation materials can be accessed through Gates Industrial's website at investors.
gates.com. For those unable to access the webcast, the conference call can be accessed by dialing (888) 414-4601 (domestic) or +1 (646) 960-0313 (international) and requesting the Gates Industrial Corporation First-Quarter 2025 Earnings Conference Call or providing the Conference ID of 5772067.
An audio replay of the conference call can be accessed by dialing (800) 770-2030 (domestic) or +1 (647) 362-9199 (international), and providing the passcode 5772067, or by accessing Gates Industrial's website at investors.gates.com.
About Gates Industrial Corporation plc Gates is a global manufacturer of innovative, highly engineered power transmission and fluid power solutions. Gates offers a broad portfolio of products to diverse replacement channel customers, and to original equipment manufacturers ("OEM") as specified components. Gates participates in many sectors of the industrial and consumer markets.
Our products play essential roles in a diverse range of applications across a wide variety of end markets ranging from harsh and hazardous industries such as agriculture, construction, manufacturing and energy, to everyday consumer applications such as printers, power washers, automatic doors and vacuum cleaners and virtually every form of transportation. Our products are sold in more than 130 countries across our four commercial regions: the Americas; Europe , Middle East & Africa ; Greater China ; and East Asia & India . Forward-Looking Statements This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
In some cases, you can identify these forward-looking statements by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "could," "seeks," "predicts," "intends," "trends," "plans," "estimates," "anticipates" or the negative version of these words or other comparable words. These statements include, but are not limited to, statements related to expectations regarding the performance of the Company's business and financial results, and statements regarding our outlook for 2025. Such forward-looking statements are subject to various risks and uncertainties, including, among others, U.
S. government policies, actions or legislation (including the imposition of tariffs), economic, political and other risks associated with international operations, risks inherent to the manufacturing industry, macroeconomic factors beyond the Company's control (including material and logistics availability, inflation, supply chain and labor challenges and end-market recovery), risks related to catastrophic events, continued operation of our manufacturing facilities, including as a result of cybersecurity attacks, our ability to forecast and meet demand and market acceptance of new products. Additional factors that could cause the Company's results to differ materially from those described in the forward-looking statements can be found under the section entitled "Risk Factors" of the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 2024, as such factors may be updated from time to time in the Company's periodic filings with the SEC, which are accessible on the SEC's website at www.
sec.gov . Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements.
These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in the Company's filings with the SEC. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. Non-GAAP Financial Measures This press release includes certain non-GAAP financial measures, which management believes are useful to investors, securities analysts and other interested parties.
Management uses Adjusted EBITDA as its key profitability measure. This is a non-GAAP measure that represents EBITDA before certain items that impact comparison of the performance of our business either period-over-period or with other businesses. We use Adjusted EBITDA as our measure of segment profitability to assess the performance of our businesses, and it is used for total Gates as well because we believe it is important to consider our total profitability on a basis that is consistent with that of our operating segments.
Adjusted EBITDA Margin is Adjusted EBITDA for a particular period expressed as a percentage of net sales for that period. Management uses Adjusted Net Income as an additional measure of profitability. Adjusted Net Income is a non-GAAP measure that represents net income attributable to shareholders before certain items that impact comparison of the performance of our business, either period-over-period or with other businesses.
Beginning with the three months ended June 29, 2024 , we revised our definition of Adjusted Net Income to adjust for discrete tax items, which are significant, unusual or infrequently occurring tax items. We have revised the prior period amounts to conform to our current period presentation. Core sales is a non-GAAP measure that represents net sales for the period excluding the impacts of movements in average currency exchange rates and the first-year impacts of acquisitions and disposals, when applicable.
Core sales growth is the change in core sales expressed as a percentage of prior period net sales. We present core sales growth because it allows for a meaningful comparison of year-over-year performance without the volatility caused by foreign currency gains or losses, or the incomparability that would be caused by the impact of an acquisition or disposal. Management uses Free Cash Flow to measure cash generation.
Free Cash Flow is a non-GAAP measure that represents net cash provided by operations less capital expenditures. Free Cash Flow Conversion is a measure of Free Cash Flow expressed as a percentage of Adjusted Net Income. We use this metric as a measure of the success of our business in converting Adjusted Net Income into cash.
These non-GAAP financial measures should be considered only as supplemental to, and not as superior to, financial measures prepared in accordance with GAAP. Please see below for a reconciliation of historical non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP. SOURCE Gates Industrial Corporation plc.
