UFP Technologies Reports 26.1% Revenue Growth to $504.4 Million for Fiscal Year 2024

UFP Technologies, Inc. reported a significant increase in its financial performance for the fiscal year ended December 31, 2024, with net sales rising 26.1% to $504.4 million, compared to $400.1 million in 2023. This growth was driven by both organic sales growth of 8.5% and contributions from four strategic acquisitions, which added approximately $70.3 million to net sales. The company's net income also saw a substantial increase, rising 31.3% to $59.0 million, up from $44.9 million in the previous year. Operating income increased by 40.3%, reflecting improved margins and effective cost management.

The company's gross profit margin improved to 29.1% in 2024, up from 28.1% in 2023, attributed to lower material costs and enhanced manufacturing efficiencies. Selling, general, and administrative expenses (SG&A) increased by 22.3% to $62.2 million, primarily due to costs associated with the recent acquisitions and higher performance-based compensation. However, as a percentage of net sales, SG&A decreased to 12.3% from 12.7%, indicating effective leverage of fixed costs against rising sales.

UFP Technologies executed four strategic acquisitions in 2024, including Marble Medical, AJR Enterprises, Welch Fluorocarbon, and AQF Medical, which collectively expanded its capabilities in the medical device sector. These acquisitions contributed to a 30.2% increase in medical market sales, which represented 89.4% of total net sales for the year. The company also reported a significant increase in its employee headcount, reflecting the integration of new operations and the expansion of its workforce to support growth.

The company’s liquidity position remains strong, with net cash provided by operations amounting to approximately $66.6 million. However, net cash used in investing activities was approximately $210.2 million, primarily due to the acquisitions. UFP Technologies has entered into a secured $275 million Amended and Restated Credit Agreement to finance these acquisitions, with approximately $189.4 million in outstanding borrowings as of December 31, 2024. The company plans to continue investing in capacity enhancements and may pursue additional acquisitions to further its growth strategy.

Looking ahead, UFP Technologies anticipates continued growth driven by its strategic acquisitions and organic sales in the medical device market. The company remains focused on leveraging its recent acquisitions to enhance operational efficiencies and expand its market presence. However, it acknowledges potential economic uncertainties that could impact future performance, including inflation and market conditions. The company is committed to maintaining its financial health and operational flexibility to navigate these challenges.