Q1 2025 Vestis Corp Earnings Call Transcript
Key Points
- Vestis Corp (VSTS) reported Q1 revenue of $684 million, in line with expectations and flat sequentially from Q4 2024.
- Adjusted EBITDA for Q1 was $81.2 million, marking a 1% sequential increase from Q4 2024.
- The company expects new volume growth to exceed lost business in Q2, driven by field sales productivity and national account wins.
- Vestis Corp (VSTS) has resumed hiring for frontline sales, with a positive net change in sales headcount in January 2025.
- Customer retention improved to 92.9% in Q1, up 30 basis points year-over-year and 280 basis points sequentially.
- Q1 revenue was down 4.7% year-over-year, or 4.5% on a constant currency basis, impacted by unfavorable Canadian dollar exchange rates.
- The EBITDA margin decreased by 180 basis points year-over-year to 11.9%.
- Cash flow was negatively impacted by normal seasonality and timing shifts in cash collection into Q2.
- Net debt remains high at $1.27 billion, with a net debt-to-EBITDA ratio of 3.8 times.
- The company faces ongoing challenges from lost business and the rollback of prior year pricing actions.
Welcome to the Vestis Corporation fiscal first quarter 2025 earnings conference call. (Operator Instructions) I would now like to turn the call over to Michael Aurelio, Vice President, Investor Relations.
Thank you, Madison, and good morning, everyone. Welcome to the Vestis Corporation fiscal first quarter 2025 earnings call. With me here today are our President and CEO, Kim Scott; and our CFO, Rick Dillon. As a reminder, a telephonic replay of this call will be available on the Investor Relations section of the vestis.com website shortly after the completion of the call. Also, access to the materials discussed on today's call are available on the Vestis' website under the Investor Relations section.
Before we begin, I would like to remind you that this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include remarks about management's future expectations, beliefs, estimates, plans
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