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CARLISLE COMPANIES INC (CSL)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $1.10B, diluted EPS $3.13 and adjusted EPS $3.61; Carlisle modestly beat Wall Street consensus on EPS ($3.42*) and slightly exceeded revenue ($1.089B*) and EBITDA ($236.0M*) estimates, helped by strong March and re-roofing demand. Bold beat: adjusted EPS $3.61 vs $3.42*; revenue $1,095.8M vs $1,088.8M*; adjusted EBITDA $238.4M vs $236.0M* [functions.GetEstimates]*
  • Adjusted EBITDA margin compressed to 21.8% (~240 bps YoY) on lower carryover pricing, CWT deleveraging, and targeted innovation investments; management reaffirmed FY 2025 guidance: mid-single-digit revenue growth and ~50 bps adjusted EBITDA margin expansion .
  • Segment performance bifurcated: CCM revenue +2% to $799M with 27.1% adjusted EBITDA margin; CWT revenue -5% to $297M with 15.6% adjusted EBITDA margin on soft residential and drier West Coast winter .
  • Capital allocation is a catalyst: Carlisle repurchased 1.2M shares for $400M in Q1 and lifted 2025 buyback target to $1.0B (from $800M), reinforcing confidence in $1B full-year FCF and Vision 2030 ($40 adjusted EPS, ≥25% ROIC) .

What Went Well and What Went Wrong

What Went Well

  • Strong March rebound and resilient re-roofing underpinning CCM: “improved weather conditions in March and healthy reroofing activity helped to offset much of the unfavorable impact” .
  • M&A synergy traction: “MTL continues to exceed our expectations… on track to exceed $20 million of synergies… leveraging COS and cross-selling with Henry and CCM” .
  • Capital return and conviction: Q1 buybacks of $400M; 2025 repurchase target raised to $1B; management reiterated $1B full-year FCF and Vision 2030 trajectory .

What Went Wrong

  • Margin compression vs prior year: Adjusted EBITDA margin fell to 21.8% (−240 bps YoY) on negative price/cost and CWT deleverage; adjusted EPS -3% YoY .
  • CWT weakness: Revenue -5% (−12% organic), adjusted EBITDA -28% with 15.6% margin due to soft residential, fewer rain events impacting coatings, and negative price/cost .
  • Seasonal cash flow: Free cash flow from continuing ops was -$30.4M vs $132.0M last year, reflecting lower income and higher working capital in seasonally light quarter; cash balance declined to $220.2M largely due to repurchases .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$1,333.6 $1,122.9 $1,095.8
Diluted EPS ($USD)$5.30 $3.56 $3.13
Adjusted EPS ($USD)$5.78 $4.47 $3.61
Operating Margin %23.7% 19.9% 16.8%
Adjusted EBITDA ($USD Millions)$367.9 $281.7 $238.4
Adjusted EBITDA Margin %27.6% 25.1% 21.8%
SegmentQ1 2024Q1 2025
CCM Revenue ($USD Millions)$783.6 $798.5
CCM Adjusted EBITDA ($USD Millions)$226.8 $216.5
CCM Adjusted EBITDA Margin %28.9% 27.1%
CWT Revenue ($USD Millions)$312.9 $297.3
CWT Adjusted EBITDA ($USD Millions)$64.7 $46.3
CWT Adjusted EBITDA Margin %20.7% 15.6%
KPIQ1 2024Q4 2024Q1 2025
Operating Cash Flow from Continuing Ops ($USD Millions)$156.0 $1,039.2 -$1.4
Free Cash Flow from Continuing Ops ($USD Millions)$132.0 $938.3 -$30.4
Share Repurchases ($USD Millions)$150.0 $420.0 $400.0
Cash & Equivalents ($USD Millions)$552.6 $753.5 $220.2
Long-term Debt incl. Current ($USD Millions)$1,890.6 $1,890.6 $1,894.4
Total Stockholders’ Equity ($USD Millions)N/A$2,463.3 $2,166.5
Q1 2025 Actual vs ConsensusConsensusActual
Primary EPS ($USD)3.4186*3.61
Revenue ($USD Millions)1,088.8*1,095.8
EBITDA ($USD Millions)236.0*238.4

Values marked with * retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious Guidance (Q4’24)Current Guidance (Q1’25)Change
Revenue GrowthFY 2025Mid-single-digit Mid-single-digit (reaffirmed) Maintained
Adjusted EBITDA MarginFY 2025~+50 bps ~+50 bps (reaffirmed) Maintained
CCM RevenueFY 2025Up mid-single digits Up mid-single digits (reaffirmed) Maintained
CWT RevenueFY 2025Up high single digits Up high single digits (reaffirmed) Maintained
Corporate & Unallocated ExpenseFY 2025N/A~$110M New detail
Capital ExpendituresFY 2025N/A~$150M New detail
Depreciation & AmortizationFY 2025N/A~$200M New detail
Net Interest ExpenseFY 2025N/A~$50M New detail
Base Tax RateFY 2025N/A23–24% New detail
Share RepurchasesFY 2025$800M target (implied start-’25) $1.0B target (raised) Raised
DividendOngoing$1.00 per share; 48th consecutive annual increase (Aug ’24) $1.00 declared in Q1 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
Pricing / Price-CostFavorable raw materials supported record margins; CCM adj. EBITDA margin 32.8% Negative price/cost impacted margins; CWT pressure Low single-digit price declines in both segments; expect neutral in Q2; H2 pricing up low-single-digits → +1% price/cost for year Improving H2
Residential MarketsContinued headwinds; CWT down 3% organically Broader macro (rates, affordability) pressured residential, CWT down 7% New resi down mid-single digits H1; flat to up low-single digits H2; R&R flat for year Stabilizing H2
Re-roofing DemandRobust contractor backlogs; CCM +9% revenue Resilient re-roofing more than offset macro Strong re-roofing; CMS indicates low-single-digit volume increase, prices up low-single digits starting Q2 Stable to improving
Tariffs / MacroNot highlightedMacro pressures persisted Negligible direct impact (90%+ sourcing and sales in NA); minor indirect impact; caution on recession risk Watchful
Inventory in ChannelNormalization supported CCM —Channel inventory low; some pre-buy ($15M) largely Canada; potential price support Low inventories persist
M&A SynergiesAgreement to acquire Plasti-Fab; synergy plan Completed Plasti-Fab; acquired ThermaFoam MTL synergies >$20M, exceeding plan; integrating metals with CCM/Henry Strengthening
Innovation / R&DOngoing new products; portfolio strength —Accelerating innovation across CCM/CWT (Seam Shield, Blueskin VP Tech, UltraTouch); target 25% of revenue from new products by 2030 Accretive
Cash Flow / LeverageStrong FCF YTD FCF $938M for FY’24 Seasonal cash use in Q1; full-year FCF ≈$1B expected; net debt/EBITDA 1.2x; EBITDA/interest 19.5x Normalizing post-Q1

Management Commentary

  • “Over 90% of our raw materials are sourced within North America… we currently expect a negligible direct impact from tariffs in 2025.” — Chris Koch, CEO .
  • “Feedback from our latest Carlisle Market Survey… reinforces our positive outlook on the 2025 roofing season… commercial roofing volumes will be up low single digits… prices will increase low-single-digits starting in the second quarter.” — Chris Koch, CEO .
  • “Our acquisition of MTL continues to exceed our expectations… on track to exceed $20 million of synergies… collaboration across Henry and CCM creating solution packages.” — Chris Koch, CEO .
  • “We now expect to deploy approximately $1 billion into share repurchases in 2025… [and] generate full year free cash flow of approximately $1 billion for 2025.” — Kevin Zdimal, CFO .

Q&A Highlights

  • Price/cost cadence: Q2 price and cost “basically neutral”; H2 pricing up low-single digits, raw materials neutral → +1% price/cost for the year .
  • Pre-buying and inventories: ~$15M accelerated orders (largely Canada) ahead of tariff-related price increases; minimal Q2 impact; inventories in distribution remain light by historical standards .
  • CWT pricing and products: CWT price down ~1% in Q1, driven by spray foam; ATO and fasteners/plates price increases expected to continue into Q2 .
  • MDI sourcing: 90-day RFP cycles; slight low-single-digit increases locked into Q2; antidumping case could add upward pressure; raw materials expected neutral for full year .
  • Financial posture: Net debt/EBITDA 1.2x; EBITDA/interest 19.5x; base tax rate 23–24%; capex ~$150M; D&A ~$200M; net interest ~$50M .

Estimates Context

  • Q1 2025 beats vs S&P Global consensus: Adjusted/Primary EPS $3.61 vs $3.42*; revenue $1,095.8M vs $1,088.8M*; adjusted EBITDA $238.4M vs $236.0M*; 7 estimates for both EPS and revenue [functions.GetEstimates]*.
  • Implication: Modest upward bias to near-term EPS estimates likely, with margin trajectory tied to Q2 price-cost neutrality and H2 price realization, and improving CWT cadence into H2 .

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Reaffirmed FY guidance and Q1 beat on EPS/EBITDA should support estimate stability; watch for Q2 neutral price/cost and H2 pricing uplift to drive ~50 bps margin expansion in 2025 .
  • Capital return is a notable support: $1.0B 2025 buyback target and $1B FCF guidance underpin EPS durability and multiple support, even as CWT remains mixed near-term .
  • CCM remains the engine: resilient re-roofing, channel inventories still light, and announced price increases gaining traction into Q2/H2; short-term headwind from Q1 Canada pre-buy offsets in Q2 .
  • CWT recovery thesis hinges on retail/weather normalization, automation and new products (UltraTouch, VP Tech), and Plasti-Fab/ThermaFoam synergies; monitor coating demand as rain patterns normalize over 4–6 months .
  • Tariff risk manageable given NA sourcing footprint (~90%+) and limited China exposure (~5%); macro/indirect risks remain the bigger swing factor for H2 volumes .
  • Balance sheet capacity intact (1.2x net debt/EBITDA; $1B revolver availability) to fund buybacks and selective M&A while maintaining ROIC ≥25% target .
  • Near-term trading: favor dips ahead of Q2 as pricing turns neutral and H2 realization improves; medium-term thesis anchored on Vision 2030 innovation and metals integration synergies (MTL) .