Acme United Corporation (ACU) Q1 2025 Earnings Report

Acme United reported a solid first quarter (Q1 2025) with revenue of $46.0 million, up 2% year-over-year from $45.0 million, and net income of $1.65 million ($0.41 per diluted share), up slightly from $1.63 million in the prior year. The company delivered a 39% gross margin and an operating margin around 5.28%, with EBITDA of approximately $4.05 million. The quarter was highlighted by a 14% year-over-year increase in the first aid business, continued strength in Westcott cutting tools, and growth in ODMT sharpeners, while Europe experienced a 7% local-currency decline due to a promotional compare in the prior year. Management underscored an ongoing emphasis on manufacturing efficiency and automation (e.g., a $0.65 million four-robot system in NC with a second system ordered for Vancouver) that is expected to reduce labor intensity and drive payback in under two years. In parallel, Acme is pursuing selective acquisitions in North America to expand scale in both its cutting tools and first aid businesses, noting the current environment may create acquisition opportunities. Tariff volatility remains the dominant near-term uncertainty; management signaled price realization as a core mechanism to offset higher costs and preserve margins, while also viewing tariffs as a potential market-share lever. The balance sheet remains solid, with a strong current ratio and a conservative leverage profile, though free cash flow remains negative in the quarter due to working capital dynamics and capital investments in automation and capacity. Overall, Acme’s QQ1 2025 results reflect a resilient core business with meaningful operating leverage potential through mix optimization, cost discipline, automation, and selective growth through acquisitions, albeit with near-term margin pressure from tariff uncertainty and working capital build.