ESAB (ESAB) Q4 2024 earnings summary

Executive summary

• Achieved record fourth quarter profits and adjusted EBITDA margin, capping a strong year despite FX headwinds and flat organic sales growth.

• Over 100 new products launched, with three bolt-on acquisitions completed in 2024 and Bavaria signed as the first 2025 deal.

• Free cash flow conversion exceeded 100%, supporting debt reduction and future growth investments.

• Delivered full-year 2024 results in line with guidance, with sales of $2.59B, adjusted EBITDA of $511M, and adjusted EPS of $5.06.

• Continued focus on innovation, automation, and operational improvement through the EBX business system.

Financial highlights

• Fourth quarter adjusted EBITDA margin reached a record 20.3%, up 90 basis points year-over-year.

• Full-year 2024 adjusted EBITDA margin set a new record at 19.7%, with adjusted EBITDA of $510.7M.

• Free cash flow for the year was $321 million, with conversion above 100% and net leverage reduced to 1.6x.

• Americas Q4 sales declined 8% YoY to $282M, but adjusted EBITDA margin rose to 21.6%.

• EMEA & APAC Q4 sales grew 3% YoY to $351M, with 4% volume growth and 19.3% EBITDA margin.

Outlook and guidance

• 2025 organic growth expected at 0–2%, with 1.5 points from M&A and 3.5 points FX headwind.

• Adjusted EBITDA guidance for 2025 is $515–$530 million, with margin expansion and adjusted EPS of $5.10–$5.25.

• Americas volumes expected to turn positive in Q4 2025; EMEA and APAC to see low- to mid-single-digit growth.

• $25 million in productivity and restructuring savings targeted, offset by $15 million in growth investments.

• Cash flow conversion guidance remains at approximately 100%.