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MH

Mativ Holdings, Inc. (MATV)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $484.8M, down 3.1% YoY but up vs Q4 2024; adjusted EPS was $(0.14) and GAAP EPS was $(7.82) due to a $411.9M non‑cash goodwill impairment; adjusted EBITDA declined to $37.2M, down 19% YoY .
  • Against S&P Global consensus, revenue beat ($484.8M vs $470.3M*) while adjusted EPS missed (−$0.14 vs −$0.11*); coverage was thin (1 estimate each)*.
  • SAS delivered fifth consecutive quarter of adjusted EBITDA margin improvement (+3% YoY; margin 11.2%), while FAM faced demand softness and sell‑through of higher‑cost year‑end inventory; net debt ended at $1.04B with liquidity ~$407M .
  • Management lowered 2025 CapEx to ~$40M (from $50M prior), raised interest expense assumptions to ~$75M plus ~$9M AR fees, targeted $10–$15M incremental 2025 cost reductions and $20–$30M inventory reduction; expects a significant sequential step‑up in Q2 adjusted EBITDA similar to last year’s ~$20M .
  • Dividend maintained at $0.10/share; focus remains on deleveraging; tariff exposure is limited (<7% of sales) with mitigation playbooks in place .

What Went Well and What Went Wrong

What Went Well

  • SAS organic sales up ~6% with adjusted EBITDA up >3% and margin expansion to 11.2%; healthcare and release liners volumes up >20% YoY .
  • Strong management urgency and strategic focus: “We are pivoting to a much higher sense of urgency... undertake the necessary changes to grow market share... and restore value to our shareholders” — Shruti Singhal, CEO .
  • Liquidity robust at ~$407M; interest expense slightly down YoY; unallocated adjusted EBITDA expenses improved versus prior year .

What Went Wrong

  • FAM segment sales down 7.4% YoY; adjusted EBITDA down 30% as higher manufacturing/distribution costs and unfavorable price vs input costs outweighed lower SG&A .
  • Consolidated adjusted EBITDA down 19% YoY (to $37.2M); consolidated adjusted operating profit fell to $15.2M (3.1% ROS) .
  • GAAP net loss $(425.5)M driven by goodwill impairment; FX losses pressured other income; tax rate impacted by valuation allowance changes .

Financial Results

Consolidated Results (quarterly)

MetricQ1 2024Q4 2024Q1 2025
Revenue ($M)$500.2 $458.6 $484.8
GAAP EPS$(0.52) $0.03 $(7.82)
Adjusted EPS (diluted)$0.02 $0.05 $(0.14)
Adjusted EBITDA ($M)$45.8 $44.8 $37.2

Notes:

  • YoY: Revenue −3.1%; adjusted EBITDA −19%; SAS organic growth +5.7%; FAM −7.4% .
  • QoQ: Revenue +$26.2M vs Q4; adjusted EBITDA −$7.6M (derived from cited values) .

Estimates vs Actuals – Q1 2025 (S&P Global)

MetricConsensusActualSurprise
Revenue ($M)470.34*484.8 Beat*
Primary EPS−0.11*−0.14 Miss*

Values marked with * were retrieved from S&P Global (Capital IQ); coverage: Primary EPS # of estimates=1*, Revenue # of estimates=1*.

Segment Performance – Q1 2025 vs Q1 2024

SegmentNet Sales Q1 2024 ($M)Net Sales Q1 2025 ($M)Adj. EBITDA Q1 2024 ($M, %)Adj. EBITDA Q1 2025 ($M, %)
FAM$202.7 $187.6 $33.2 (16.4%) $23.3 (12.4%)
SAS$297.5 $297.2 $32.3 (10.9%) $33.3 (11.2%)
Total$500.2 $484.8 $45.8 (9.2%) $37.2 (7.7%)

KPIs and Balance Sheet

KPIQ1 2024Q1 2025
Cash used in operations ($M)$(13.0) $(15.9)
Capital spending ($M)$12.1 $13.9
Interest expense ($M)$18.3 $17.8
Net Debt ($M)$995.0 (Dec 31, 2024) $1,038.8 (Mar 31, 2025)
Total Liquidity ($M)$451 (Dec 31, 2024) ~$407 (Mar 31, 2025)
Dividend per share$0.10 (Q4 announcement) $0.10 (Q1 announcement)

Guidance Changes

MetricPeriodPrevious Guidance (Q4 2024 call)Current Guidance (Q1 2025 call/PR)Change
CapExFY 2025~$50M ~$40M Lowered
Interest expenseFY 2025~$70M ~$75M Raised
AR facility feesFY 2025~$8M ~$9M Raised
Working capitalFY 2025~+$10M use ~$10M source Improved
Cost reductionsFY 2025–2026$20M by YE 2026 +$10–$15M in 2025; total $30–$35M by YE 2026 Raised
Inventory reductionFY 2025Not specified$20–$30M reduction New
Normalized tax rateFY 202524% 24% Maintained
Unallocated adj. EBITDAFY 2025~$80M ~$80M Maintained
Q2 Adj. EBITDA seq. step‑upQ2 2025Not specifiedSignificant step‑up similar to ~$20M last year New
DividendOngoingContinue $0.10/share Continue $0.10/share Maintained

Earnings Call Themes & Trends

TopicQ3 2024 (Nov)Q4 2024 (Feb)Q1 2025 (May)Trend
Advanced Films turnaroundTiger team formed; PPF quality/competition issues; smart glass partnership announced Quality remediation; adjacent optical/medical films +30% in Q4; new smart glass partnerships FAM pressured by higher‑cost inventory; mid‑tier PPF solution; expanding optical/medical films Improving execution; demand still mixed
SAS momentumAdjusted EBITDA +~20% YoY; margin +200 bps Strong Q4; SAS FY adjusted EBITDA +~19%, margin +210 bps Fifth consecutive EBITDA/margin improvement; healthcare/release liners +>20% Sustained strength
Tariffs/macroLow direct exposure; potential advantage vs Asian imports Mitigation plans; flexible sourcing <7% sales exposed; detailed regional exposure and mitigation playbook Managed risk; cautious demand
Cost/CapEx discipline$20M overhead reductions in 2024; CapEx cut to ~$50M Further reductions; CapEx down; footprint optimization Additional $10–$15M 2025 reductions; CapEx to ~$40M; inventory −$20–$30M Incrementally tighter
Leverage/debtNet leverage ~4.1x; target 2.5–3.5x by 2026 Net leverage 4.4x; deleveraging priority Net leverage 4.7x; expect improvement starting Q3; focus on cash to reduce debt Near‑term headwinds; plan to improve

Management Commentary

  • “Our top priority is to accelerate our pace of execution with a focus on three key areas: driving enhanced commercial execution, sharpening our efforts to de‑lever the balance sheet, and conducting a strategic review of our portfolio.” — Shruti Singhal, CEO .
  • “We expect a significant sequential step‑up in adjusted EBITDA performance [in Q2], similar to last year's step‑up of $20 million… driven by volume (especially SAS), higher fixed cost absorption, and improved relative price vs input cost.” — Greg Weitzel, CFO .
  • “Less than 7% of our annual sales are currently subject to tariff exposure… we have a comprehensive playbook on mitigating the impact, including pricing decisions, tariff pass‑throughs, and alternative sourcing strategies.” — Shruti Singhal .
  • “Capex will be reduced to ~$40 million per year versus the $55 million incurred in 2024… inventory levels reduced by $20–$30 million in 2025.” — Shruti Singhal .

Q&A Highlights

  • Portfolio review: Early days, focus on unlocking value, deleveraging, and balancing contribution by category; updates to come as actions are identified .
  • Cash flow cadence: Expect positive Q2 cash flow and significant YoY improvement driven by inventory and CapEx reductions plus sequential EBITDA gains .
  • Margins/dividend: Near‑term margins suppressed by seasonality and films; pricing actions underway; dividend to continue despite deleveraging focus .
  • Tariffs: Minimal direct exposure; mitigation via pricing and local‑for‑local supply chains; no pre‑buying surge observed; customers cautious .
  • FAM growth actions: Build pipeline in automotive/construction despite weakness; prioritize optical, medical, dental films; mid‑tier PPF offering and quality improvements to regain trust .

Estimates Context

  • Q1 2025 revenue beat consensus ($484.8M vs $470.3M*) while adjusted/Primary EPS missed (−$0.14 vs −$0.11*); only one estimate for each metric, limiting signal strength*.
  • Implications: The revenue beat alongside margin pressure (films, manufacturing/distribution costs, price vs input costs) suggests near‑term estimate revisions may favor sales stability with cautious EPS adjustments until Q2 margin step‑up materializes .
    Values marked with * were retrieved from S&P Global (Capital IQ).

Key Takeaways for Investors

  • Narrative shift to operational urgency and deleveraging: incremental 2025 cost cuts (+$10–$15M), CapEx lowered to ~$40M, inventory reduction ($20–$30M) — supportive of near‑term FCF improvement .
  • SAS is the growth ballast (healthcare/release liners +>20% YoY); FAM recovery hinges on films turnaround, mid‑tier PPF, and adjacent optical/medical film growth .
  • Expect Q2 adjusted EBITDA to step up meaningfully (similar to ~$20M last year) as pricing actions and cost absorption improve; monitor execution vs this explicit marker .
  • Balance sheet: Net debt ~$1.04B; leverage 4.7x covenant headroom ~0.8x; deleveraging remains the #1 cash priority; dividend maintained .
  • Tariff exposure is limited (<7% of sales), with playbooks to mitigate; indirect demand impacts remain the greater macro risk .
  • For trading: Results likely hinge on evidence of Q2 margin rebound and films pipeline traction; watch pricing/input cost spreads and sequential SAS volumes .
  • For the medium term: Portfolio review and commercial cross‑selling (“One Mativ”) initiatives could re‑rate margins if execution in films and targeted growth platforms persists .

Search notes:

  • Read the full Q1 2025 8‑K earnings press release and financial schedules –.
  • Read the full Q1 2025 earnings call transcripts (multiple sources) – – –.
  • Prior quarters for trend analysis: Q4 2024 8‑K and call – –; Q3 2024 8‑K and call – –.
  • No additional press releases found in Q1 2025 beyond the 8‑K earnings release (search 2025‑01‑01 to 2025‑03‑31 returned none).