Matthews International (MATW) investor relations material

Executive summary

• Q3 2026 was challenging, with all previously identified risks materializing, including delays in engineering orders, tariff impacts, slower synergy realization at Propelis, and geopolitical/economic headwinds.

• Net loss attributable to shareholders was $23.7 million for Q3 2026, compared to net income of $15.4 million in Q3 2025, driven by divestitures, lower operating performance, and higher strategic costs.

• Major divestitures included SGK, warehouse automation, and European packaging and print businesses, impacting sales and segment performance.

• Memorialization segment showed year-over-year improvement, with sales growth driven by the Dodge acquisition, though profitability was pressured by lower casket volumes and rising input costs.

• CEO announced intention to retire, with succession planning underway.

Financial highlights

• Q3 2026 sales were $246 million, down from $349 million year-over-year, reflecting divestitures and lower engineering sales; nine-month sales were $789.4 million, down from $1.18 billion.

• Q3 net loss was $23.7 million (EPS: $(0.75)), compared to net income of $15.4 million (EPS: $0.49) last year; adjusted EPS was $0.06, down from $0.28.

• Adjusted EBITDA for Q3 was $35 million (margin 14.2%), down from $44.6 million (margin 12.8%) last year; nine-month adjusted EBITDA was $115 million, down from $136 million.

• Operating cash flow YTD was $(69.5) million, reflecting divestiture, litigation, and restructuring costs.

• Quarterly dividend of $0.255/share declared, payable August 24, 2026.

Outlook and guidance

• Adjusted EBITDA guidance for fiscal 2026 revised to $158–$162 million, including estimated 40% share of Propelis adjusted EBITDA.

• Memorialization segment expected to deliver record full-year adjusted EBITDA of ~$175 million, but faces continued input cost pressures and low U.S. death rates.

• Propelis synergy realization delayed by SAP implementation, but annualized EBITDA run rate of $130 million still targeted by end of 2026.

• Energy storage solutions delays expected to persist through year-end; cost reduction actions underway.

• Strategic review continues for Industrial Technologies, focusing on partnerships and restructuring.