Gates Industrial
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Gates Industrial (GTES) investor relations material

Gates Industrial Q4 2025 earnings summary

Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.
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Q4 2025 earnings summary12 Feb, 2026

Executive summary

  • Achieved record adjusted EBITDA and adjusted EPS in 2025, outperforming end markets and offsetting macro and trade policy volatility.

  • Net leverage ratio improved to 1.85x, with $100M debt repaid and over $100M in share repurchases in Q4.

  • Entered 2026 with cautious optimism for industrial demand recovery, supported by a book-to-bill above 1x and positive order trends.

  • Personal mobility business grew over 25% and data center business expanded 4x year-over-year.

  • Full-year 2025 net sales totaled $3,443.2 million, up 1.0% year-over-year, with core sales growth of 0.7%.

Financial highlights

  • Adjusted EPS for 2025 was $1.52, up from $1.39 in 2024, at the top end of guidance.

  • Q4 2025 net sales were $856M, with core growth of nearly 1% and total revenue up over 3% due to favorable FX.

  • Q4 adjusted EBITDA was $188M, with a margin of 21.9%, up 10 bps year-over-year.

  • Free cash flow conversion was 238% in Q4 and 92% for full year 2025.

  • Ended 2025 with over $800 million in cash and a record low net leverage ratio.

Outlook and guidance

  • 2026 core sales expected to grow 1%-4% year-over-year.

  • Adjusted EBITDA guidance: $775M-$835M, with margin rate up slightly at midpoint.

  • Adjusted EPS guidance: $1.52-$1.68, 5% growth at midpoint, assuming no further share repurchases.

  • Q1 2026 revenue guidance: $845M-$875M, with a 2%-2.5% core sales decline due to fewer business days and ERP transition.

  • 2026 capital expenditures projected at ~$120M; free cash flow conversion target above 90%.

Prioritize share repurchases or debt reduction?
Fluid Power core sales decline; 2026 growth drivers?
Key drivers of improved cost position in 2025?
Personal Mobility and Data Center growth outlook?
Industrial market recovery validation points?
M&A appetite and capital deployment priorities?
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Citi's Global Industrial Tech & Mobility Conference 202618 Feb, 2026
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Citi's Global Industrial Tech & Mobility Conference 202618 Feb, 2026

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Frequently asked questions

Gates Industrial is a global manufacturer and distributor of power transmission and fluid power products, including belts, hoses, valves, couplings and filters under the Gates® and IHS™ brands. They serve an extensive variety of markets and applications including agriculture, construction equipment, material handling, automotive aftermarket parts logistics, trucking, aerospace and transportation (locomotives), off-highway equipment and watercraft. With state-of-the-art manufacturing and application engineering capabilities, Gates aims to enable its customers to further increase efficiency and lower cost of ownership.

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