H.B. Fuller Co. recently reported financial results for the first quarter ended February 27, 2021. Net revenue of $726 million increased 12.3% compared with the first quarter of 2020. Foreign currency exchange rates favorably impacted revenue by 1.8%. Organic revenue, which excludes impacts from foreign currency translation, increased 10.5% compared to the 2020 fiscal quarter. Strong sales growth in Engineering Adhesives and Hygiene, Health and Consumable Adhesives offset effects of slower commercial construction and extreme weather on Construction Adhesives revenues.
"Leveraging the momentum we created throughout 2020, the H.B. Fuller team delivered exceptional financial performance of 30% growth in EBITDA in the first quarter of fiscal 2021," said Jim Owens, president and CEO. "It is clear that our diversified business model, coupled with a global focus on operational agility and market-driven innovation, are competitive advantages for H.B. Fuller in the adhesives industry, especially in a changing world.
"In 2021, we will focus on continuing to grow our business profitably by innovating and supporting our customers' success in the current, high-demand and supply-constrained environment. H.B. Fuller has done a remarkable job in supporting customers through effective sourcing strategies and supply chain management. In the second quarter, we have implemented significant price adjustments which will enable us to continue to seamlessly serve our customers. In addition, our team is working to release additional capacity for growth through our operational excellence programs and to achieve an additional $200 million of debt reduction in 2021."
Raw material costs are expected to rise as the year progresses, driven by increasing industrial demand and supply constraints of U.S. petrochemicals resulting from severe winter weather in the Gulf Coast in February. The company expects full-year raw material costs to increase 5-8% compared to 2020. H.B. Fuller has implemented annualized price adjustments of more than $100 million that are effective in the second quarter and are anticipated to offset raw material increases. The company reports that it is prepared to implement further increases in the third quarter, as necessary.
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