Richelieu Hardware (RCH) Q1 2025 earnings summary

Executive summary

• Q1 2025 sales rose 8.6% year-over-year to CAD 442 million, equally driven by internal growth and five acquisitions, despite stagnant market conditions.

• Five acquisitions since the start of the fiscal year, adding approximately $50 million in annual sales and expanding presence in key North American markets.

• Market development and diversification initiatives, along with investments in retail programs and product lines, supported growth and are yielding sales gains in Canada.

• Q1 is typically the weakest period, but strategic initiatives helped offset broader market weakness.

Financial highlights

• Q1 sales reached CAD 442 million, up 8.6% year-over-year, with Canadian sales at CAD 242 million (up 4.1%) and U.S. sales at US$140 million (up 7.6%).

• EBITDA was CAD 42.4 million, up 5% from Q1 2024, with margin slightly down to 9.6% from 9.9% due to lower margins from acquisitions and marketing costs.

• Net earnings attributable to shareholders were CAD 13.9 million, down 8.6% due to higher amortization and increased financial expenses from expansion and credit line usage.

• Diluted EPS was $0.25, compared to $0.27 last year.

• Working capital stood at CAD 613.2 million with a ratio of 2.9:1; net operating cash inflow was $3.7 million.

Outlook and guidance

• Market expected to remain flat or show low single-digit growth, in line with industry peers.

• Management expects to navigate U.S. tariffs effectively, with less than 20% of U.S. imports sourced from China and alternatives in place.

• Continued focus on integrating acquisitions and seeking further M&A opportunities.

• Investments in new in-store displays and product lines are expected to boost retail sales, with early positive results in Canada.