H.B. Fuller Co. (NYSE: FUL) reported higher third-quarter fiscal 2026 revenue, adjusted earnings and margins as pricing more than offset lower volumes and elevated raw-material costs. The adhesives maker said adjusted EBITDA rose 9% year over year to $187 million, while adjusted diluted earnings per share increased 21% to $1.52.

Revenue increased 5.2% from a year earlier, including organic revenue growth of 4.4%. Adjusted EBITDA margin expanded 80 basis points to 19.9%. Adjusted gross profit margin rose 120 basis points to 33.5%, which the company attributed to pricing execution and restructuring savings.

Adjusted selling, general and administrative expense increased 8% year over year but declined 7% sequentially from the second quarter. For the year to date, cash flow from operations improved 17% to $183 million. Net debt to adjusted EBITDA was slightly below 3.0 times, compared with 3.3 times a year earlier.

Growth Across Business Units

Hygiene, Health and Consumable Adhesives recorded 6% organic revenue growth, driven by pricing. Strength in Hygiene, Beverage Labeling, and Tape & Label more than offset weakness in Packaging. The unit’s adjusted EBITDA margin increased 70 basis points to 17.6%.

Engineering Adhesives generated 1% organic revenue growth including Solar, or 5% when Solar was excluded. Aerospace and General Industries remained strong. H.B. Fuller said it has now fully lapped its exit from Solar and does not anticipate a meaningful effect from that exit on organic growth going forward. The segment’s adjusted EBITDA margin rose 50 basis points to 23.8%.

Building Adhesive Solutions posted 5% organic revenue growth, supported by Roofing and Insulating Glass and partly offset by softness in Wood. Adjusted EBITDA increased 8%, while margin expanded 50 basis points, driven by positive pricing.

Geographically, organic revenue increased 4% in the Americas, with all three global business units contributing growth. Roofing, Insulating Glass and Aerospace were the principal areas of strength. EIMEA organic revenue rose 9%, reflecting positive pricing across all three business units and strong volume growth in Engineering Adhesives markets including Automotive and Aerospace.

Asia-Pacific organic revenue was flat when Solar was included and increased 4% excluding Solar. Performance in the region was supported by Hygiene, Health and Consumable Adhesives, particularly Packaging.

Fiscal 2026 Outlook

H.B. Fuller now expects fiscal 2026 adjusted EBITDA of $655 million to $670 million and adjusted diluted EPS of $4.70 to $4.85. Its projected core tax rate is 25.5% to 26.0%.

The company continues to expect net revenue to increase by a mid-single-digit percentage and organic revenue to rise by a low-single-digit percentage. The organic outlook assumes mid-single-digit pricing growth and a low-single-digit volume decline. Foreign-currency translation is expected to add approximately 2% to revenue.

Operating cash flow is still projected at $300 million to $325 million, excluding items related to the pending acquisition of adhesives maker AMS. H.B. Fuller said the regulatory approval process is progressing and that it remains on track to close the transaction by year-end. Management expects leverage to return to its targeted range of 2.5 to 3.0 times within two years after closing.

Restructuring and Operating Risks

H.B. Fuller said its multiyear Project Quantum Leap restructuring program remains on schedule. Excluding AMS, the company expects to finish 2026 with approximately 62 manufacturing facilities, down from 82 at the end of 2024, and reduce the total to fewer than 60 by the end of 2027 as it works toward a goal of 55 facilities.

The program targets about $75 million of annualized conversion-cost savings by the end of 2030. H.B. Fuller expects to have realized approximately $25 million of those benefits by the end of 2026, followed by another $20 million to $25 million of incremental savings in 2027.

The company expects total program capital investment of $150 million, including roughly $50 million in 2026 and less than $25 million in 2027. It also anticipates approximately $50 million of one-time cash costs, about one-third of which have already been incurred. Expected real-estate sale proceeds are projected to more than offset those one-time costs.

Supply-chain disruption remains a key uncertainty. H.B. Fuller said raw-material prices have stabilized at elevated levels and are expected to remain at or near current levels for at least the rest of the year. The company plans to raise prices when warranted to offset raw-material costs and protect margins. It also cautioned that forward-looking results remain subject to risks described in its regulatory filings.

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