MATTHEWS INTERNATIONAL CORP Q2 FY2025 earnings call

• Energy Solutions: Reengaged with battery manufacturers/auto OEMs, issued quotes over $100M since mid-February, working on retrofit solutions for existing facilities. - SGK: All regulatory approvals secured, expected to close soon, will receive $350M upfront, divestiture of remaining German assets ongoing. - Balance Sheet: Expect to apply SGK proceeds to revolver and potentially repurchase stock. - Cost Reduction: Ongoing programs expected to save up to $50M annually, $20M in 2025, $30M in 2026. - Warehouse Automation: Strong order intake and healthy backlog signal market turn in H2.

Memorialization

• Sales for the fiscal 2025 second quarter: $205.6 million compared to $222.2 million a year ago. Volume declines in bronze and granite businesses, closure of UK cremation facility, and lower U.S. casketed deaths contributed to the decline. Adjusted EBITDA: $45 million vs $46.6 million Y/Y.

Industrial Technology

• Sales: $80.8 million vs $116.1 million Y/Y. Decline due to lower engineering sales and warehouse automation sales. Adjusted EBITDA: $6 million vs $10 million Y/Y.

SGK Brand Solutions

• Sales: $141.2 million vs $132.9 million Y/Y. Increase from higher merchandising sales and U.S./Asia-Pacific brand markets. Adjusted EBITDA: $15.6 million vs $15.4 million Y/Y.

Warehouse Automation

• Sales down Y/Y due to slow market recovery, but strong order intake and healthy backlog indicate market turn in H2.

Product Identification

• Relatively flat Y/Y results, new product launch on track for summer.

Memorialization

• Revenues down 7% Y/Y due to volume declines in bronze/granite and closure of UK cremation facility, partially offset by pricing actions.

• Adjusted EBITDA projection for fiscal 2025 updated to at least $190M due to SGK transaction closing, replacing full SGK results with pro forma 40% interest. - Dividend declared: $0.25 per share payable May 26, 2025. - Cost reduction savings: $20M in 2025, $30M in 2026.

• Long sales lead time in Energy Solutions industry. - Market recovery uncertainty for Warehouse Automation. - Volume declines and facility closure impacting Memorialization. - Litigation and market turbulence risks affecting strategic initiatives.

Q: How does the $100 million plus in customer quotes since early February compare to last year and where is interest coming from?

A: $100M+ quotes are dramatically higher than last year, from South Korea, North America, Europe; interest in mass production and grid storage.

Q: Talk about cadence of Memorialization declines and expectations for Q3/year-end?

A: Continued normalization, pullback in death rates this quarter, some comparative weakness due to prior year backlogs.

Q: Cost reduction actions, $50M target and breakdown for 2025/2026?

A: Running at ~$20M in 2025, ~$30M in 2026.

Q: Maturity of testing process and turnkey line for battery customers in North America?

A: Most quotes are for mass production, customers beyond testing phase, expect turnkey solution by September.

Q: Cost out tied to SGK, SGK accounting post close, share repurchase, retrofit, grid storage?

A: Cost out not tied to SGK; equity income on GAAP net income with one quarter lag for adjusted EBITDA; considering share repurchase post SGK close; retrofit uses same equipment, grid storage same efficiency benefits as EV.