TREDEGAR CORP (TG)·Q1 2025 Earnings Summary

Executive Summary

• Q1 2025 revenue rose 14.4% year over year to $164.74M, while diluted EPS from continuing operations was $0.02 vs $0.08 in Q1 2024; “ongoing operations” EPS was $0.10 vs $0.14 y/y . PE Films EBITDA improved y/y, while Aluminum Extrusions EBITDA declined on mix and cost headwinds .
• Order momentum strengthened at Bonnell: net new orders +36% y/y (+24% q/q) and open orders reached 25M lbs, the highest in two years; Section 232 tariffs on aluminum imports were raised to 25% in March, with no exclusions to-date and are a customer pass-through, aiding industry dynamics .
• Balance sheet/liquidity: net leverage 1.1x as of March; ABL was refinanced on May 6 into a $125M facility maturing May 2030 with ~$51M availability as of 3/31/25 (median daily liquidity $44M in Q1) .
• Management tone: “PE Films had another exceptional first quarter… balance of the year to normalize,” and tariffs are “good for our industry” and “a pass through to customers” . Expectation-setting and tariff backdrop are the likely stock catalysts near-term .

What Went Well and What Went Wrong

• What Went Well

  • PE Films execution: EBITDA from ongoing ops rose to $7.5M (+8.9% y/y) on stronger Surface Protection volume/mix/pricing and cost improvements; surface protection volume +4% y/y despite a 5.6% q/q seasonal pullback .
  • Order recovery at Bonnell: net new orders +36% y/y and +24% q/q; open orders 25M lbs (vs 17M lbs in Q4 and 15M lbs y/y), indicating steady recovery and regained share in solar framing/extrusions .
  • Liquidity and leverage: net leverage 1.1x; ABL extended to 2030; funds available to borrow ~$51M as of 3/31/25 . CEO: “Our balance sheet remains strong with a net leverage ratio of 1.1x… refinanced our $125 million asset-based lending facility for a five-year term” .

• What Went Wrong

  • Aluminum Extrusions profitability: segment EBITDA from ongoing ops fell to $9.2M (–27% y/y) on lower spread from sales mix, higher variable manufacturing costs (yield), labor increases, winter-weather maintenance, higher die expense and utilities, partially offset by higher volume; SG&A +$2.6M and fixed costs higher .
  • Overwrap softness: PE Films overwrap volume –11.9% y/y amid strong prior-year comp; partially offset by Surface Protection strength .
  • Cost inflation/events: winter weather and equipment downtime lifted maintenance; environmental compliance costs lifted SG&A; though a FIFO benefit of $1.7M aided Bonnell vs a $1.3M charge last year .

Financial Results

• Consolidated P&L vs prior periods and prior year

• Segment breakdown (Net Sales and EBITDA from ongoing operations)

• Operating KPIs and balance sheet

Notes: Consolidated EBITDA from ongoing operations excludes special items per company definitions .

Guidance Changes

Earnings Call Themes & Trends

Note: A Q1 2025 earnings call transcript was not available in our database or IR site; themes below reflect company-reported materials and prior-quarter disclosures .

Management Commentary

• “Bonnell Aluminum’s sales volume, net new orders and open orders continue to show recovery from the down cycle… The new Section 232 tariffs on aluminum imports… are a pass through to customers.” – John Steitz, President & CEO .
• “PE Films had another exceptional first quarter. We expect the balance of the year to normalize.” – John Steitz .
• “Our balance sheet remains strong with a net leverage ratio of 1.1x… we refinanced our $125 million asset-based lending facility for a five-year term.” – John Steitz .
• PE Films detail: Surface Protection saw higher volume/mix/pricing and cost improvements; overwrap pressured by lower volume and mix/pricing .

Q&A Highlights

No Q1 2025 earnings call transcript or Q&A was available via our sources or the company’s IR site; therefore, no Q&A highlights can be provided for this quarter .

Estimates Context

• S&P Global consensus estimates for Q1 2025 were not available (no published EPS or revenue consensus in our pull). Actual revenue reported was $164.74M . Values retrieved from S&P Global where applicable.*

Key Takeaways for Investors

• Order momentum at Bonnell and a 2-year-high open order book suggest revenue recovery legs despite margin headwinds; watch mix/spread and cost normalization to convert orders into EBITDA .
• PE Films is outperforming with Surface Protection strength, but management flags normalization risk and potential tariff-related demand timing; expect sequential moderation into the rest of 2025 .
• Raised Section 232 tariffs (25%) with no exclusions to-date should support domestic extruders and help Tredegar recapture share, particularly in specialty/solar; tariffs are pass-through, limiting P&L risk from input costs .
• Cost controls remain pivotal: winter-weather-driven maintenance, die expense and SG&A increases weighed on Bonnell; cadence of cost relief and productivity is a key margin lever this year .
• Liquidity is solid and duration extended: net leverage 1.1x, ~$51M ABL availability, facility extended to 2030; this supports working capital needs as volumes recover .
• Without published Street coverage for Q1 2025, near-term price moves likely hinge on internal KPIs (orders, open orders, volumes) and tariff enforcement headlines rather than beat/miss optics .
• For positioning: favor exposure if you underwrite continued order-book conversion and cost normalization at Bonnell plus steady PE Films profitability; risk skew relates to mix/spread, overwrap weakness, and macro sensitivity in B&C .

Footnote: *S&P Global estimates data were queried but consensus metrics for TG in Q1 2025 were unavailable at time of analysis.