Gates Industrial Reports Q4 Sales Growth

- For the full fiscal year 2025, Gates reported net sales of $3.44 billion, a 1.0% increase over the prior year, with an adjusted earnings per share of $1.52. - The company has issued guidance for 2026, forecasting core sales growth in the range of 1% to 4% and an adjusted EBITDA between $775 million and $835 million. - Throughout 2025, growth was supported by positive performance in its replacement channels and double-digit growth in the personal mobility business. The agriculture sector also saw a return to growth for the first time since late 2022. - Gates' management has focused on strengthening the balance sheet, paying down $100 million of gross debt during the third quarter of 2025 and successfully lowering its net leverage ratio over the year. - In late 2025, the company's Board of Directors authorized a new share repurchase program of up to $300 million. - The broader fluid power market, a key sector for Gates, experienced a slowdown in 2024 with a significant drop in new orders, particularly from European markets. However, forecasts project market stabilization in 2025 with a return to modest growth in 2026, driven by demand in energy, automated logistics, and construction. - Industrial manufacturers are navigating increased electricity demand, partly driven by the expansion of data centers, which is straining legacy grid infrastructure and creating supply chain bottlenecks for key electrical components.