ACME UNITED CORP Q4 FY2025 earnings call

• Acme United delivered record sales and earnings in 2025. Net sales were $196.5 million, net income was $10.2 million, and earnings per share were $2.49.
• Responded to tariff changes: purchased extra inventory in 2024, reacted quickly when tariffs were reduced, opened new factories in Vietnam, Thailand, Malaysia and increased production in India and Egypt, negotiated cost reductions, obtained lower freight rates, generated productivity savings, and increased prices modestly.
• Highlights in 2025: First aid team introduced patented automatic replenishment system for refills; Westcott team expanded market share of cutting tools; invested in robotics in U.S. sites for first aid components; installed new software and purchased drones for inventory management in North Carolina warehouse; purchased 78,000-square-foot plant in Tennessee for Spill Magic and other products; continued investing in MedNap facility in Florida; purchased MyMedic in January 2026 (leading direct-to-consumer first aid supplier with ~$19M 2025 revenues); first aid business in Canada grew strongly; expanded market share in cutting in Europe; acquired direct-to-consumer cutting and sharpening tools supplier in Europe.

Acme United delivered record sales and earnings in 2025. Net sales were $196.5 million, net income was $10.2 million, and earnings per share were $2.49. Fourth quarter net sales were $47.5 million, up 3% from $45.9 million in 2024. Year-end net sales were $196.5 million, up 1% from $194.5 million in 2024. U.S. segment: fourth quarter net sales constant, year-end sales declined 1% due to tariff uncertainty affecting school and office products but first aid and medical products were strong. Europe: fourth quarter net sales increased 22% in local currency, year-end up 4% mainly due to acquired cutting and sharpening tools. Canada: fourth quarter net sales increased 14% in local currency, year-end up 16% with strong first aid products but decline in school and office products. Gross margin in fourth quarter 2025 was 38.2% vs 38.7% in 2024; year-end gross margin was 39.4% vs 39.3% in 2024. STNA expenses in fourth quarter 2025 were $15.2 million (32% of sales) vs $15.5 million (34% of sales) in 2024; year-end STNA expenses were $62.7 million (32% of sales) vs $62.2 million (32% of sales) in 2024. Operating profit in fourth quarter 2025 increased 27% vs 2024. Net income in fourth quarter 2025 was $1.9 million (46 cents per diluted share) vs $1.7 million (41 cents per diluted share) in 2024; year-end net income was $10.2 million ($2.49 per diluted share) vs $10 million ($2.45 per diluted share) in 2024.

• Expect growth in first aid and medical segments in 2026.
• Anticipate return to more normal merchandising and promotion in the retail market.

• Challenging global macroeconomic environment characterized by continued high inflation, high interest rates, and imposition of new tariffs or changes in existing tariff rates.
• Experienced supply chain disruptions and may experience them in the future.

Q: Jim Maroney from Singular Research asked about integration of MyMedic, multiple aspects of the acquisition including EV multiple, payment method.

A: Acquisition of MyMedic is meaningful with half million social media followers. Intends to expand direct-to-consumer business within first aid offering, will be selective with retail distribution. EBITDA of MyMedic was between 1M and 1.5M. Purchase price was 18.6M with 1M earn-out and $3M holdback. Net out-of-pocket was about $4M. Acquisitions are opportunistic, looking to expand in first aid and medical or vertical acquisitions like suppliers of components.