Executive Summary
Friedman Industries reported Q1 2025 revenue of $114.6 million, down 16.6% year-over-year and 13.4% sequentially, accompanied by a very modest gross profit of $3.11 million and a gross margin of 2.72%. Despite a positive net income of $2.57 million, the quarter featured a negative operating income of $1.40 million, underscoring material operating margin compression amid softer volumes and a cost base that remains challenging in the current steel cycle. The net result was aided by total other income of $4.70 million, highlighting that a portion of earnings came from non-operating items rather than core operations. From a cash-flow perspective, operating cash flow was negative at $6.06 million and free cash flow was negative at $7.11 million, driven by working-capital needs and modest capital expenditure.
The balance sheet remains liquid with a strong current ratio of 4.19 and total assets of $222.79 million, but leverage remains meaningful: total debt stands at $48.98 million and net debt at $44.83 million. Cash at period end was $4.15 million. Financing activities provided $5.37 million, partially offsetting a negative free cash flow profile. The quarter’s results reinforce the cyclicality of Friedman’s Coil and Tubular businesses and the sensitivity of earnings to working-capital dynamics and the broader steel pricing environment. Going forward, the key for investors will be: (1) whether core EBITDA margins can stabilize above maintenance costs as volumes recover, (2) the trajectory of working-capital normalization, and (3) the company’s ability to manage debt and sustain liquidity in a volatile cycle.
Key Performance Indicators
QoQ: -13.37% | YoY:-16.57%
QoQ: -95.32% | YoY:-80.94%
QoQ: -113.98% | YoY:-113.50%
QoQ: -48.23% | YoY:-66.62%
QoQ: -47.14% | YoY:-64.42%
Key Insights
Revenue: $114,551,000 in QQ1 2025, YoY -16.57% ; QoQ -13.37%.
Gross Profit: $3,113,000; Gross Margin 2.72%; YoY -80.94%; QoQ -95.32%.
Operating Income: -$1,398,000; Operating Margin -1.22%; YoY -113.50%; QoQ -113.98%.
Net Income: $2,567,000; Net Margin 2.24%; YoY -66.62%; QoQ -48.23%.
EPS: $0.37; Diluted EPS $0.37; YoY -64.42%; QoQ -47.14%.
EBITDA: $4,775,000; EBITDA Margin 4.17%.
Cash Flow: Net cash from operating activities -$6.06 million; Free cash flow -$7.11 million; Capex $1.05 million; Ch...
Financial Highlights
Revenue: $114,551,000 in QQ1 2025, YoY -16.57% ; QoQ -13.37%.
Gross Profit: $3,113,000; Gross Margin 2.72%; YoY -80.94%; QoQ -95.32%.
Operating Income: -$1,398,000; Operating Margin -1.22%; YoY -113.50%; QoQ -113.98%.
Net Income: $2,567,000; Net Margin 2.24%; YoY -66.62%; QoQ -48.23%.
EPS: $0.37; Diluted EPS $0.37; YoY -64.42%; QoQ -47.14%.
EBITDA: $4,775,000; EBITDA Margin 4.17%.
Cash Flow: Net cash from operating activities -$6.06 million; Free cash flow -$7.11 million; Capex $1.05 million; Change in working capital -$7.82 million.
Balance Sheet (selected): Cash & equivalents $4.15 million; Total assets $222.80 million; Total liabilities $93.10 million; Total stockholders’ equity $129.69 million; Total debt $48.98 million; Net debt $44.83 million; Current ratio 4.19; Debt-to-capitalization 0.274; Debt-to-equity 0.378; Price-to-book 0.776; P/E 9.81.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
114.55M |
-16.57% |
-13.37% |
| Gross Profit |
3.11M |
-80.94% |
-95.32% |
| Operating Income |
-1.40M |
-113.50% |
-113.98% |
| Net Income |
2.57M |
-66.62% |
-48.23% |
| EPS |
0.37 |
-64.42% |
-47.14% |
Key Financial Ratios
operatingProfitMargin
-1.22%
operatingCashFlowPerShare
$-0.87
freeCashFlowPerShare
$-1.03
dividendPayoutRatio
10.9%
Management Commentary
Note: The earnings transcript data for QQ1 2025 was not provided in the dataset. As such, there are no management quotes to quote or themes to extract from an official call in this report. If the transcript becomes available, a dedicated section will be added to extract themes by category (strategy, operations, market conditions) and to attach direct quotes with context and significance.
Forward Guidance
No formal forward-looking guidance is disclosed in the provided dataset for QQ1 2025. Given the cyclical nature of the steel and tubular businesses, investors should monitor: (i) stabilization or improvement in coil and tubular demand and pricing, (ii) cost-control initiatives that can lift EBITDA margins toward maintenance levels, (iii) working-capital efficiency and capex trajectory, and (iv) debt-reduction or refinance activities to sustain liquidity. A constructive uplift in EBITDA margins and a reduction in working-capital intensity could unlock meaningful free cash flow in a follow-on quarter, but the absence of explicit guidance requires a cautious stance until revenue and cost structures show clearer stabilization.