Mon, May 12, 12:32 PM (42 days ago)
**UFP Technologies, Inc. (UFPT) Q1 2025 Financial Summary** **Financial Health and Performance:** - **Revenue:** Q1 2025 revenue increased by 41.1% to $148.1 million from $105.0 million in Q1 2024, driven by a 50.4% growth in medical market sales, primarily from 2024 acquisitions. - **Profit Margins:** Gross margin slightly decreased to 28.5% from 28.6% in Q1 2024 due to inefficiencies in newly acquired operations and increased overhead costs. - **Net Income:** Net income rose to $17.2 million from $12.7 million, with earnings per share increasing to $2.24 from $1.66. - **Cash Flow:** Net cash provided by operations was $13.8 million, primarily from net income and adjustments for depreciation and share-based compensation. **Key Metrics and Trends:** - **Acquisitions:** Significant acquisitions in 2024 (Marble Medical, AJR Enterprises, Welch Fluorocarbon, AQF) contributed $40.7 million in sales. - **Customer Concentration:** Top two customers (Stryker Corporation and Intuitive Surgical SARL) accounted for 45.4% of total net sales. - **Debt and Liquidity:** Outstanding borrowings under the Third Amended and Restated Credit Agreement were $182.8 million, with a weighted average interest rate of 5.9%. The company is compliant with all covenants. **Future Operations and Uncertainties:** - **Growth Strategy:** UFPT plans to continue organic growth and strategic acquisitions. - **Tariffs:** Increased U.S. tariffs on foreign imports may impact manufacturing costs, supply chain, and sales volumes. - **Liquidity:** The company expects to fund operations through internally generated cash and bank credit facilities, with sufficient resources to meet cash flow requirements for the next twelve months. **Subsequent Events:** - **AJR Specialty Products and AJR Custom Foam Products Acquisition:** Completed on April 25, 2025, for $2.8 million, adding capacity in the single-use safe patient handling space. **Conclusion:** UFPT demonstrated strong revenue growth in Q1 2025, driven by strategic acquisitions and organic growth. However, the company faces challenges related to customer concentration, tariffs, and integration of new acquisitions. UFPT remains focused on expanding its market presence and enhancing operational efficiencies.