FUL - H.B. Fuller: Strong FQ2 Despite Pressure On Margins

• FUL's quarterly revenues rose precipitously, touching $827.9 million, which implies almost 23% growth year-over-year. Organic revenues that strip off the effect of acquisitions were up 19%.
• The quarter was not totally cloudless. FUL had to cope with supply/demand imbalances that sent raw materials prices higher and ate into gross profit.
• Cash flows were under pressure due to higher inventory. That was required to support the short-term sales growth.
• FUL secured its dividend king status by increasing the DPS for the 52nd consecutive year. The 1% yield, however, is unattractive.
• I am neutral.

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