REG - Somero Enterprises - Interim Results
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RNS Number : 4988Y Somero Enterprises Inc. 09 September 2025
9 September 2025
Somero(®) Enterprises, Inc.
("Somero" or "the Company" or "the Group")
Interim Results for the six months ended 30 June 2025
Challenging market conditions; long-term drivers intact, guidance reaffirmed
Financial Highlights H1 2025 H1 2024 % Change
US$ US$
Revenue $39.8m $51.8m -23%
Adjusted EBITDA((1,2)) $6.4m $12.4m -48%
Adjusted EBITDA margin((1,2)) 15.9% 23.8% -790bps
Profits before tax $4.9m $10.6m -54%
Adjusted net income((1,3)) $3.3m $8.0m -59%
Diluted adjusted net income per share((1,3)) $0.06 $0.14 -57%
Cash flow from operations 4.1m $2.9m 41%
Net cash((4)) $24.6m $20.8m 18%
Interim dividend per share $ 0.04 $ 0.08 -50%
· Disciplined approach to H1: against a challenging market backdrop
· US the key headwind: North America revenue -18% due to dampened project starts
and investment confidence linked to tariffs, elevated interest rates and
restrictive immigration policies as previously reported
· Softer international trading: Europe -51% reflecting customer caution amid US
and geopolitical uncertainty; Australia -34% as sales volumes normalize
against a backdrop of skilled labor shortages and tightened monetary policy;
ROW -11% primarily due to reduced Latin America volumes
· However, demand drivers remain intact: onshoring, data infrastructure,
equipment electrification, EV/battery facilities, manufacturing, warehousing
and logistics, and power generation
· High bidding activity and healthy project backlogs: reported by customers
· Strong new product contribution: delivered US$ 4.2m revenue, up 36%
· Cost action taken: partly offsetting impact of lower revenues on profitability
· Operating cashflow improvement: aided by favorable timing of collections
· Unchanged FY25 guidance: Trading is expected to strengthen in the second half
of the year, supported by seasonal uplift and contributions from new
products. Revenues of c. US$ 90.0m, EBITDA of c. US$ 18.0m, and year-end
cash of c. US$ 24.0m.
Operational Highlights
· Key leadership appointments:
o Bob Scheuer as Chairman, bringing deep knowledge of Somero and Fortune 500
leadership experience
o Tim Averkamp as Chief Executive Officer, with 30 years of international
experience in global construction machinery and equipment innovation
· New product launch:
o The SRS-4e in January, Somero's first electric-powered Boomed Laser Screed
o The Hammerhead in H2, expanding Somero's reach beyond its traditional base
into the expansive mid-range concrete contractor segment
o The S-15EZ in H2, a next-generation mid-sized Boomed Screed
· Updated strategic framework: to guide the Company's next phase of growth
Notes:
1. The Company uses non-US GAAP financial measures to provide supplemental
information regarding the Company's operating performance. See further
information regarding non-GAAP measures below.
2. Adjusted EBITDA as used herein is a calculation of the Company's net income
plus tax provision, interest expense, interest income, foreign exchange loss,
other expense, depreciation, amortization stock-based compensation and
non-cash lease expense.
3. Adjusted net income as used herein is a calculation of net income plus
amortization of intangibles and excluding the tax impact of stock option and
RSU settlements and other special items.
4. Net cash is defined as cash and cash equivalents less borrowings under bank
obligations exclusive of deferred financing costs.
Tim Averkamp of Somero, said:
"I am proud of how the Company has navigated the challenges presented by the
first half of the year. While macroeconomic uncertainty weighed on
performance, our disciplined focus on operational efficiency and the enduring
nature of our long-term growth drivers position us well for recovery as market
conditions stabilize.
"The introduction of three new products this year - including our first
electric-powered laser screed - underscores our commitment to long-term growth
and innovation. With two more new products set to debut in the second half, we
continue to broaden our customer reach and deepen our international presence.
"We are encouraged by the underlying resilience of our core markets and expect
performance to strengthen as macroeconomic challenges begin to subside. With
an eye on the future, I'm pleased with the early developments to refresh our
long-term strategic framework which is focused on driving resilience today and
positioning the business to capture the substantial opportunities ahead. Our
history of operational discipline and adaptability gives us confidence that we
will emerge from this period stronger, more agile, and better prepared to
seize future opportunities."
For further information, please contact:
Enquiries:
Somero Enterprises, www.somero.com (http://www.somero.com)
Inc.
+1 239 210 6500
Tim Averkamp
CEO
Vincenzo LiCausi, CFO
Howard Hohmann, EVP Sales
Cavendish Capital Markets Ltd (NOMAD and Broker) +44 (0)20 7220 0500
Matt Goode /Seamus Fricker (Corporate Finance)
Tim Redfern/Harriet Ward (ECM)
Alma PR (Financial PR Advisor) somero@almapr.co.uk (mailto:somero@almapr.co.uk)
+44 (0)20 3405 0205
David
Ison
Rebecca Sanders-Hewett
Will Merison
Notes to Editors:
Somero Enterprises provides industry-leading concrete-leveling equipment,
training, education and support to customers in over 90 countries. The
Company's cutting-edge technology allows its customers to install high-quality
horizontal concrete floors faster, flatter and with fewer people. Somero®
equipment that incorporates laser-technology and wide-placement methods is
used to place and screed the concrete slab in all building types and has been
specified for use in a wide range of commercial construction projects for
numerous global blue-chip companies.
Somero pioneered the Laser Screed® market in 1986 and has maintained its
market-leading position by continuing to focus on bringing new products to
market and developing patent-protected proprietary designs. In addition to its
products, Somero offers customers unparalleled global service, technical
support, training and education, reflecting the Company's emphasis on helping
its customers achieve their business and profitability goals, a key
differentiator to its peers.
For more information, visit www.somero.com (http://www.somero.com)
Chairman's and Chief Executive Officer's Statement
Overview
The Board is pleased with the Company's ability to respond swiftly and
decisively to external pressures, preserving profitability while remaining
steadfast in executing its long-term growth strategy of introducing new
products and further penetrating international markets. The Board is pleased
with the overall performance in H1 2025 given the scale, persistence, and
global nature of the macroeconomic challenges affecting trading.
Revenue was US$ 39.8m (H1 2024: US$51.8m), a 23% decline, with most markets
and product categories contributing. The Company's flexible cost structure
enabled rapid adjustment to lower volumes, helping deliver adjusted EBITDA of
US$6.4m (H1 2024: US$12.4m) with a margin of 15.9% (H1 2024: 23.8%). Pricing
actions and efficiency gains partially offset unabsorbed overhead in the
period, supporting a healthy gross margin of 52.8% (H1 2024: 54.6%).
Cash flow was US$ 4.1m (H1 2024: US$ 2.9m), benefiting from timing of
collections and lower capital outlays, translating to a cash balance of US$
24.6m at 30 June 2025 after paying a US$ 7.1m dividend in May. Inventory
build-up was primarily attributable to new products and lower sales, but with
trading expected to strengthen in H2, supported by normal seasonality and
contributions from two new products, full-year inventory levels are expected
to moderate.
Regional Review
North America
North American sales declined 18% to US$ 31.8m (H1 2024: US$ 38.8m), primarily
driven by lower sales of Boomed and Ride-on screeds. Revenue from direct sales
to new customers represented 15% of total H1 revenue in the region (2024:
23%). Customers continue to report healthy bidding and robust backlogs,
however project starts, as previously reported, continue to be subdued.
Despite this, underlying demand in the non-residential market remains
positive, supported by long-term structural trends. Furthermore, the worsening
shortage of skilled labor is increasing the need for automation and
productivity improvements, which in turn continues to drive demand for our
products.
Europe
Sales in Europe were US$ 3.5m (H1 2024: US$ 7.1m), a 51% decline, reflecting
weaker market conditions compounded by turbulent trade relations with the US
and on-going geopolitical conflicts. Revenue from direct sales to new
customers represented 38% of total H1 revenue in the region (2024: 32%).
Europe remains one of Somero's key target international markets, with the
Company continuing to view the region as offering significant future growth
potential despite the near-term headwinds. The 2024 opening of our Belgium
service center has enhanced our ability to serve the customers in the region
and to meet demand for local machine repair and servicing.
Australia
In Australia, revenue declined 34% to US$ 2.1m (H1 2024: US$ 3.2m). Revenue
from direct sales to new customers represented 25% of total H1 revenue in the
region (2024: 62%). The transition from a dealer model to direct sales
alongside the addition of key sales and support personnel facilitated the
rapid expansion of our in-country product range from 2020 onwards. There was a
strong initial uptake, contributing to the exceptional growth seen in recent
years. Furthermore, the territory is experiencing severe shortages of skilled
tradespeople, persistent inflation and significantly tightened monetary policy
to bring inflation back within its target range. While we expect the long-term
growth rate in Australia to continue to normalize, there remains opportunity
to further deepen market penetration in the region. We continue to focus on
growing revenue in this territory by broadening awareness and educating the
marketplace on Somero's value proposition.
Rest of World
Our Rest of World region, which includes Latin America, the Middle East,
India, Southeast Asia, Korea and China, reported sales of US$ 2.4m (H1 2024:
US$ 2.7m), representing an 11% decline. The main contributor to H1 2025
revenues was Latin America, which reported sales of US$ 0.5m compared to US$
1.3m in H1 2024. As previously stated, given the relatively small base of
business in each region, trading will fluctuate from period to period.
Product Review
H1 2025 revenue performance
· Boomed screeds: US$ 13.3m (down 30%). Long-term demand continues to be
supported by drivers including onshoring, data centers and AI infrastructure,
EV and battery plants, and US legislation such as the CHIPS Act
· Ride-on screeds: US$ 7.1m (down 35%)
· 3D Profiler System: US$ 2.7m (down 37%)
· Remanufactured machines: US$ 3.4m (down 15%)
· Parts and service: US$ 8.5m (down 14%), with most of the decline in North
America and a relatively stable performance in Europe supported by the
addition of the Belgium service center in 2024
Encouragingly, sales of new products including SRS-4e, SRS-6, S-940e,
SkyScreed®, SkyStrip, S-PS50 and Broom + Cure® were US$ 4.2m, up 36%.
Sales of the SkyScreed 36, originally introduced in 2019, were US$ 0.7m (H1
2024: none). Targeting a new market segment and disrupting established
practices, we continue to believe the product has significant long-term
potential in the high-rise structural market. As with many of our new
products, adoption is expected to be gradual and trading volatile at the
beginning of its life. However, each launch reflects years of R&D and
direct engagement with customers, giving us confidence that our diversified
pipeline is well aligned with future demand. We remain focused on driving
market penetration and unlocking the long-term value of these innovations.
New product launches
The Company continues to advance a robust pipeline of innovations designed to
open new markets, strengthen its competitive position, and meet changing
customer needs. Investment in R&D is a core strategic priority, ensuring
Somero is well positioned to capture long-term growth opportunities as the
construction industry evolves.
In January, the Company launched the SRS-4e, an electric version of the
popular SRS-4 Boomed screed, continuing its electrification journey. Customer
feedback has been positive, particularly in Europe where demand for
sustainable solutions is more advanced. Electrification remains an important
part of our long-term agenda, with our approach guided by customer demand.
While uptake is still at an early stage in our industry, we continue to invest
selectively to ensure we are well positioned as adoption develops.
Looking ahead to H2, the Hammerhead by Somero will broaden our reach into the
mid-range concrete contractor segment with a solution designed for quality,
ease of use and affordability. This segment is significantly larger than the
Company's traditional commercial customer base and has different needs
necessitating a tailored offering.
The third new machine set to launch in H2 is the S-15EZ, the next generation
successor to the S-15R mid-sized Boomed screed. Incorporating the latest
technologies and features, the S-15EZ offers enhanced maneuverability,
quality, and productivity, making it well suited to today's market where pour
sizes have been trending down.
Alongside the development of new machines, the Company is also committed to
improving current and future products through new technologies and enhancing
the overall customer experience. In January, the Company launched a virtual
reality simulation training program for the S-22EZ, complete with mobile phone
app, giving customers the ability to train anytime, anywhere. This
cutting-edge tool reduces costs, improves efficiency, and demonstrates our
commitment to using technology to deliver lasting value beyond the machine
itself.
Beyond these launches, our product pipeline remains active and
forward-looking. We are advancing R&D to deliver new machines that
address customer pain points and enhance productivity, introducing
technologies to strengthen both current and future products, and exploring
opportunities in adjacent markets. Several initiatives are already underway
that have the potential to open further growth avenues. While details will be
shared in due course, our commitment to innovation ensures that Somero remains
well positioned to anticipate customer needs and capture future demand.
Updated Strategic Framework
Against a backdrop of near-term market challenges, the Board has refreshed
Somero's long-term strategic framework to reinforce resilience today while at
the same time positioning the business to capture the substantial
opportunities ahead. The framework is designed to guide the Company through
current conditions with focus and discipline, while sharpening execution
around areas of highest impact. In the longer term, the framework is intended
to drive sustainable growth and ultimately superior shareholder returns.
The framework builds on the Company's proven model, while incorporating fresh
perspectives from new leadership. It reflects Somero's ambition to reinforce
its foundations, extend its track record of innovation, and broaden its reach.
Crucially, it provides a common language and shared focus across the
organization, aligning resources and priorities and ensuring everyone at the
Company pulls in the same direction.
The updated framework is built around three strategic pillars:
1. Fortify: reinforcing Somero's foundation through strengthening operational
excellence, delivering best in class customer service and support, and
continued investment in people, culture and processes.
2. Innovate: driving innovation through new product developments, advancing
technologies, refining processes, and discovering better ways to serve our
customers. By harnessing customer insight and our industry expertise, we
strive to create or acquire solutions that address evolving needs and deliver
lasting value both within current markets and as we explore new opportunities.
3. Amplify: expanding and scaling Somero's reach into new customer segments,
augmenting sales channels, and spreading awareness of the Company's value
proposition in existing and adjacent markets through both organic growth
initiatives and strategic acquisitions.
Implementation of the framework is now underway, with the broader organization
developing initiatives under each pillar. While this work is in its early
stages, the framework ensures the organization and its resources are aligned
and directed toward the areas with the greatest impact on growth and value
creation. As the program progresses, the Board expects to refine priorities
and, in time, provide further updates in due course.
Cashflow and Balance Sheet
Operating cash flow in H1 2025 was US$ 4.1m (H1 2024: US$ 2.9m) benefiting
from a decrease in working capital as a result of timing of collections.
Capital expenditure was US$ 0.5m (H1 2024: US$ 1.7m), relating to on-going
product software programs and other activities in the ordinary course of
business. Dividends of US$ 7.1m (H1 2024: US$ 11.4m) were paid, reflecting the
Company's ongoing commitment to disciplined return of cash to shareholders,
alongside US$ 0.8m share repurchases under the 2024 and 2025 buyback programs.
Net cash at 30 June 2025 was US$ 24.6m (31 December 2024: US$ 29.5m, 30 June
2024: US$ 20.8m) after the dividend payments, leaving the Company with ample
liquidity to support operations and strategic investments. The balance sheet
remains debt-free with access to an unutilized US$ 25.0m secured revolving
line of credit, providing a strong platform for future growth.
Dividend and Share Buyback Program
Based on the results in H1 2025 and the outlook for the remainder of 2025, we
are pleased to report that the Board has declared an interim dividend of US$
0.04 per share, maintaining a balance between interim and final dividends as
in prior years. The dividend, totaling approximately US$ 2.2m, will be payable
on 17 October 2025 to shareholders on the register at 19 September 2025. The
ex-dividend date is 18 September 2025.
In H1 2025, the Company repurchased a total of 256,734 shares under the
Company's ongoing buyback program put in place to offset dilution from equity
award schemes. Shares were acquired in line with previously announced program
parameters. The Company will make further announcements to the market as and
when further repurchases are made.
Our People
On behalf of the Board, we would like to thank all our employees worldwide for
their continued commitment and contribution. The adaptability and dedication
of the Somero team remain a core strength, enabling the Company to respond
effectively to changing conditions while consistently delivering high-quality
products and service to customers. This agility underpins our flexible cost
model and supports sustained profitability. The Board and management remain
committed to providing a rewarding and challenging environment with
opportunities for all employees to grow and succeed.
Outlook
Demand for US non-residential construction remains resilient, supported by
positive long-term trends across key end-markets. Global uncertainty - linked
to factors including tariffs, persistently high interest rates and restrictive
immigration policies - continues to weigh on the pace of projects, however
customers report strong levels of bidding activity and healthy backlogs which
are expected to extend through year-end.
The Board expects trading to improve in H2 compared with H1, supported by
normal seasonality and contributions from new products.
We continue to anticipate full year 2025 revenues of c. US$ 90.0m, adjusted
EBITDA of c. US$ 18.0m, and year-end net cash of c. US$ 24.0m.
Bob Scheuer
Non-Executive Chairman
Tim Averkamp
Chief Executive Officer
9 September 2025
FINANCIAL REVIEW
Summary of financial results For the six months ended June 30
* unaudited 2025 2024
US$ 000 US$ 000
Except per share data Except per share data
Revenue 39,828 51,839
Cost of sales 18,796 23,527
Gross profit 21,032 28,312
Operating expenses
Selling, marketing and customer support 6,704 8,183
Engineering and product development 1,025 1,347
General and administrative 8,585 7,953
Total operating expenses 16,314 17,483
Operating income 4,718 10,829
Other income (expense)
Interest expense (20) (20)
Interest income 215 194
Foreign exchange impact (58) (522)
Other 3 122
Income before income taxes 4,858 10,603
Provision for income taxes 2,266 2,462
Net income 2,592 8,141
Per Share
Per Share
US$ US$
Basic earnings per share 0.05 0.15
Diluted earnings per share 0.05 0.15
Basic adjusted net income per share ((1), (2), (4)) 0.06 0.15
Diluted adjusted net income per share ((1), (2), (4)) 0.06 0.14
Other data
Adjusted EBITDA ((1), (2), (4)) 6,352 12,350
Adjusted net income ((1), (3), (4)) 3,308 8,046
Depreciation expense 1,051 789
Amortization of intangibles 71 71
Capital expenditures 506 1,650
Notes:
1. Adjusted EBITDA and Adjusted net income are not measurements of the
Company's financial performance under US GAAP and should not be considered as
an alternative to net income, operating income or any other performance
measures derived in accordance with US GAAP or as an alternative to US GAAP
cash flow from operating activities as a measure of profitability or
liquidity. Adjusted EBITDA and Adjusted net income are presented herein
because management believes they are useful analytical tools for measuring the
profitability and cash generation of the business. Adjusted EBITDA is also
used to determine pricing and covenant compliance under the Company's credit
facility and as a measurement for calculation of management incentive
compensation. The Company understands that although Adjusted EBITDA is
frequently used by securities analysts, lenders, and others in their
evaluation of companies, its calculation of Adjusted EBITDA may not be
comparable to other similarly titled measures reported by other companies.
2. Adjusted EBITDA as used herein is a calculation of net income plus tax
provision, interest expense, interest income, foreign exchange gain (loss),
other expense, depreciation, amortization, stock-based compensation, and
non-cash lease expense.
3. Adjusted net income as used herein is a calculation of net income plus
amortization of intangibles and excluding the tax impact of stock option and
RSU settlements and other special items.
4. The Company uses non-US GAAP financial measures to provide supplemental
information regarding the Company's operating performance. The non-US GAAP
financial measures presented herein should not be considered in isolation
from, or as a substitute to, financial measures calculated in accordance with
US GAAP. Investors are cautioned that there are inherent limitations
associated with the use of each non-US GAAP financial measure. In particular,
non-US GAAP financial measures are not based on a comprehensive set of
accounting rules or principles, and many of the adjustments to the US GAAP
financial measures reflect the exclusion of items that may have a material
effect on the Company's financial results calculated in accordance with US
GAAP.
Net income to adjusted EBITDA reconciliation and
Adjusted net income reconciliation
* unaudited Six months ended June 30
2025 2024
US$ 000 US$ 000
Adjusted EBITDA reconciliation
Net income 2,592 8,141
Tax provision 2,266 2,462
Interest expense 20 20
Interest income (215) (194)
Foreign exchange impact 58 522
Other (3) (122)
Depreciation 1,051 789
Amortization 71 71
Non-cash lease expense 118 183
Stock-based compensation 394 478
Adjusted EBITDA 6,352 12,350
Adjusted net income reconciliation
Net income 2,592 8,141
Amortization 71 71
Valuation allowance on deferred tax assets 857 -
Tax impact of stock option & RSU settlements (212) (166)
Adjusted net income reconciliation 3,308 8,046
Notes:
1. Adjusted EBITDA and Adjusted net income are not measurements of the
Company's financial performance under US GAAP and should not be considered as
an alternative to net income, operating income or any other performance
measures derived in accordance with US GAAP or as an alternative to US GAAP
cash flow from operating activities as a measure of profitability or
liquidity. Adjusted EBITDA and Adjusted net income are presented herein
because management believes they are useful analytical tools for measuring the
profitability and cash generation of the business. Adjusted EBITDA is also
used to determine pricing and covenant compliance under the Company's credit
facility and as a measurement for calculation of management incentive
compensation. The Company understands that although Adjusted EBITDA is
frequently used by securities analysts, lenders, and others in their
evaluation of companies, its calculation of Adjusted EBITDA may not be
comparable to other similarly titled measures reported by other companies.
2. Adjusted EBITDA as used herein is a calculation of the Company's net income
plus tax provision, interest expense, interest income, foreign exchange gain
(loss), other expense, depreciation, amortization, stock-based compensation,
and non-cash lease expense.
3. Adjusted net income as used herein is a calculation of net income plus
amortization of intangibles and excluding the tax impact of stock option and
RSU settlements and other special items.
4. The Company uses non-US GAAP financial measures in order to provide
supplemental information regarding the Company's operating performance. The
non-US GAAP financial measures presented herein should not be considered in
isolation from, or as a substitute to, financial measures calculated in
accordance with US GAAP. Investors are cautioned that there are inherent
limitations associated with the use of each non-US GAAP financial measure. In
particular, non-US GAAP financial measures are not based on a comprehensive
set of accounting rules or principles, and many of the adjustments to the US
GAAP financial measures reflect the exclusion of items that may have a
material effect on the Company's financial results calculated in accordance
with US GAAP.
Revenues
The Company's consolidated revenues decreased by 23% to approximately US$
39.8m (H1 2024: US$ 51.8m). The Company's revenues consist primarily of sales
from Boomed Screed products, which include the S-28EZ, S22-EZ, S-15R, S-10A,
SRS-6, SRS-4, and SRS-4e Laser Screed machines, sales from Ride-on Screed
products, which are drive through the concrete machines that include the
S-485, S-940, S940e, and S-158C Laser Screed machines, remanufactured machines
sales, 3-D Profiler Systems, SkyScreed, and Other revenues which consist of
revenue from sales of parts and accessories, sales of other equipment,
service, training and shipping charges. The overall decrease for the period
was primarily driven by lower volume of the Boomed Screeds, particularly the
S-28EZ, and 3-D Profiler System.
Boomed Screed sales decreased to approximately US$ 13.3m (H1 2024: US$ 19.0m)
as unit volume decreased, Ride-on Screed sales decreased to approximately
US$ 7.0m (H1 2024: US$ 10.7m) due to a decrease in volume, remanufactured
machine sales decreased to approximately US$ 3.4m (H1 2024: US$ 4.0m) due to a
decrease in volume, 3-D Profiler System sales decreased to approximately US$
2.7m (2024: US$ 4.3m) due to a decrease in volume, SkyScreed sales increased
to approximately US$ 0.7m in H1 2025 (no Skyscreed sales in H1 2024). Other
revenues decreased to approximately US$ 12.7m (H1 2024: US$ 13.8m) mostly due
to a decrease in parts sales. The following table shows the breakdown during
the six months ended June 30, 2025 and 2024:
Revenue breakdown by geography
North America EMEA((1)) ROW((2)) Total
US$ in millions US$ in millions US$ in millions US$ in millions
2025 2024
2025 2024 2025 2024 2025 2024 Net sales % of Net sales Net sales % of Net sales
Boomed screeds ((3)) 11.0 13.6 1.3 3.1 1.0 2.3 13.3 33.4% 19.0 36.7%
Ride-on screeds ((4)) 4.9 7.3 1.0 1.9 1.1 1.5 7.0 17.6% 10.7 20.7%
Remanufactured machines 3.4 3.3 - 0.6 - 0.1 3.4 8.5% 4.0 7.7%
3D Profiler System 2.3 3.9 - 0.1 0.4 0.3 2.7 6.8% 4.3 8.3%
SkyScreed® 0.4 - - - 0.3 - 0.7 1.8% - -
Other ((5)) 9.8 10.7 1.5 1.5 1.4 1.6 12.7 31.9% 13.8 26.6%
Total 31.8 38.8 3.8 7.2 4.2 5.8 39.8 100% 51.8 100%
Notes:
1. EMEA includes Europe, the Middle East, and Scandinavia.
2. ROW includes Australia, Latin America, India, China, Korea, and Southeast
Asia
3. Boomed Screeds include the S-22EZ, S-28EZ, S-15R, S-10A, SRS-4, SRS-4e and
SRS-6.
4. Ride-on Screeds include the S-940,S-940e, S-485, and S-158C.
5. Other includes parts, accessories, services, and freight, as well as other
equipment such as the Somero Line Dragon®, Somero Broom+Cure, STS-11M Topping
Spreader, Copperhead, Mini Screed C and S-PS50.
Sales to customers located in North America contributed 80% of total revenue
(H1 2024: 75%), sales to customers in EMEA (Europe, Middle East, and
Scandinavia) contributed 10% (H1 2024: 14%) and sales to customers in ROW
(Southeast Asia, Australia, Latin America, India and China) contributed 10%
(H1 2024: 11%).
Sales in North America totaled approximately US$ 31.8m (H1 2024: US$ 38.8m)
down 18%, primarily driven by a decrease in both Boomed Screeds and Ride-on
Screeds. Sales to customers in EMEA were approximately US$ 3.8m (H1 2024:
US$ 7.2m) down 47%, driven mostly by a decrease in Boomed Screeds in Europe at
US$ 3.5m and to a lesser extent the Middle East. Sales to customers in ROW
were approximately US$ 4.2m (H1 2024: US$ 5.8m) decreasing by 28% driven by a
decrease across most product categories in Australia and Latin America.
US$ in millions
Regional sales H1 2025 H1 2024
North America 31.8 38.8
Europe 3.5 7.1
Australia 2.1 3.2
Rest of World((1)) 2.4 2.7
Total 39.8 51.8
Notes:
(1) Includes India, Middle East, China, Southeast Asia, Korea and Latin
America.
Gross profit
Gross profit decreased to approximately US$ 21.0m (2024: US$ 28.3m), with
gross margins decreasing to 52.8% compared to 54.6% in H1 2024, reflecting
higher input and logistical costs and lower volume scale, partly offset by a
price increase.
Operating expenses
Operating expenses excluding depreciation, amortization and stock-based
compensation for H1 2025 were approximately US$ 15.2m (H1 2024: US$ 16.4m),
which is primarily reflective of lower incentive compensation and sales
commissions, partly offset by higher expenses related to the new Belgium
facility.
Debt
As of June 30, 2025, the Company had no outstanding debt. In August 2022,
the Company updated its credit facility to a US$ 25.0m secured revolving line
of credit, with a maturity date of August 2027. The interest rate on the
revolving credit line is based on the BSBY Index plus 1.25%. The Company's
credit facility is secured by substantially all of its business assets.
Provision for income taxes
The provision for income taxes decreased to approximately US$ 2.3m, at an
overall effective tax rate of 47%, compared to a provision of approximately
US$ 2.5m in H1 2024, at an overall effective tax rate of 23%. The increase in
overall effective tax rate is due to a valuation allowance placed on foreign
deferred tax assets.
Earnings per share
Basic earnings per share represents income available to common stockholders
divided by the weighted average number of shares outstanding during the
period. Diluted earnings per share reflect additional common shares that would
have been outstanding if dilutive potential common shares had been issued, as
well as any adjustments to income that would result from the assumed issuance.
Potential common shares that may be issued by the Company relate to
outstanding stock options and restricted stock units. Earnings per common
share has been computed based on the following:
Six months ended June 30
2025 2024
US$ 000 US$ 000
Income available to stockholders 2,592 8,141
Basic weighted shares outstanding 54,814,372 55,296,172
Net dilutive effect of stock options and restricted stock units 781,228 617,468
Diluted weighted average shares outstanding 55,595,601 55,913,640
Per Share Per Share
US$ US$
Basic earnings per share 0.05 0.15
Diluted earnings per share 0.05 0.15
Basic adjusted net income per share 0.06 0.15
Diluted adjusted net income per share 0.06 0.14
Consolidated Balance Sheets
As of June 30, 2025 and December 31, 2024
As of June 30, 2025 As of December 31, 2024
* unaudited US$ 000
US$ 000
Assets
Current assets:
Cash and cash equivalents 24,628 29,486
Accounts receivable - net of allowance for credit losses of US$ 1,294 in 2025 3,905 9,251
and US$ 1,194 in 2024
Inventories - net 24,406 18,816
Prepaid expenses and other current assets 1,707 2,576
Income tax receivable 817 1,286
Total current assets 55,463 61,415
Accounts receivable, non-current - net 613 567
Property, plant, and equipment - net 26,225 26,763
Financing lease right-of-use assets - net 576 546
Operating lease right-of-use assets - net 2,162 2,224
Intangible assets - net 907 978
Goodwill 3,294 3,294
Deferred tax asset 1,145 1,982
Other assets 254 347
Total assets 90,639 98,116
Liabilities and stockholders' equity
Current liabilities:
Accounts payable 3,389 3,544
Accrued expenses 5,486 7,409
Financing lease liability - current 259 229
Operating lease liability - current 342 332
Total current liabilities 9,476 11,514
Financing lease liability - long-term 270 247
Operating lease liability - long-term 1,888 1,967
Other liabilities 81 87
Total liabilities 11,715 13,815
Stockholders' equity
Preferred stock, US$.001 par value, 50,000,000 shares authorized, no shares - -
issued and outstanding
Common stock, US$.001 par value, 80,000,000 shares authorized, 54,690,333 and 26 26
54,908,160 shares issued on June 30, 2025 and December 31, 2024, respectively,
and 54,665,540 and 54,908,160 shares outstanding on June 30, 2025 and December
31, 2024, respectively
Less: treasury stock, 24,793 shares as of June 30, 2025 and 0 shares as of (84) -
December 31, 2024 at cost
Additional paid in capital 10,150 10,947
Retained earnings 70,803 75,334
Other comprehensive loss (1,971) (2,006)
Total stockholders' equity 78,924 84,301
Total liabilities and stockholders' equity 90,639 98,116
See Notes to unaudited consolidated financial statements.
Consolidated Statements of Comprehensive Income
For the six months ended June 30, 2025 and 2024
* unaudited Six months ended June 30
2025 2024
US$ 000 US$ 000
Except per share data Except per share data
Revenue 39,828 51,839
Cost of sales 18,796 23,527
Gross profit 21,032 28,312
Operating expenses
Sales, marketing, and customer support 6,704 8,183
Engineering and product development 1,025 1,347
General and administrative 8,585 7,953
Total operating expenses 16,314 17,483
Operating income 4,718 10,829
Other income (expense)
Interest expense (20) (20)
Interest income 215 194
Foreign exchange impact (58) (522)
Other 3 122
Income before income taxes 4,858 10,603
Provision for income taxes 2,266 2,462
Net income 2,592 8,141
Other comprehensive income
Cumulative translation adjustment 35 335
Comprehensive income 2,627 8,476
Earnings per common share
Earnings per share - basic 0.05 0.15
Earnings per share - diluted 0.05 0.15
Weighted average number of common shares outstanding
Basic 54,814,372 55,296,172
Diluted 55,595,601 55,913,640
See Notes to unaudited consolidated financial statements.
Consolidated Statements of Changes in Stockholders' Equity
For the six months ended June 30, 2025
* unaudited
Common stock Treasury stock Other
Retained earnings Comprehensive
US$ 000 loss
US$ 000
Additional Total
paid-in Stockholders'
capital equity
US$ 000 US$ 000
Shares Amount Amount
US$ 000 Shares US$ 000
Balance - December 31, 2024 54,908,160 26 10,947 - - 75,334 (2,006) 84,301
Cumulative translation adjustment - - - - - - 35 35
Net income - - - - - 2,592 - 2,592
Stock-based compensation - - 394 - - - - 394
Dividend - - - - - (7,123) - (7,123)
Cancellation of treasury stock (231,941) - (737) (231,941) 737 - - -
RSUs settled for cash - - (454) - - - - (454)
Share buyback - - 256,734 (821) - - (821)
New shares issued 14,114 - - - - - - -
Balance - June 30, 2025 54,690,333 26 10,150 24,793 (84) 70,803 (1,971) 78,924
See Notes to unaudited consolidated financial statements.
Consolidated Statements of Cash Flows
For the six months ended June 30, 2025 and 2024
*unaudited Six months ended June 30
2025 2024
US$ 000 US$ 000
Cash flows from operating activities:
Net income 2,592 8,141
Adjustments to reconcile net income to net cash provided by operating
activities:
Deferred taxes 837 (694)
Depreciation and amortization 1,122 860
Non-cash lease expense 118 183
Provision for credit losses (recoveries) 100 (203)
Stock-based compensation 394 478
(Gain)/loss on sale of property and equipment (7) (37)
Working capital changes:
Accounts receivable 5,200 315
Inventories (5,590) (4,741)
Prepaid expenses and other current assets 869 222
Other assets 93 (104)
Accounts payable, accrued expenses and other liabilities (2,066) (1,533)
Income tax receivable 469 -
Net cash provided by operating activities 4,131 2,887
Cash flows from investing activities:
Property, plant, and equipment purchases (506) (1,650)
Net cash used in investing activities (506) (1,650)
Cash flows from financing activities:
Payment of dividend (7,123) (11,373)
RSUs settled for cash (454) (713)
Payments under financing leases (120) (120)
Share buy back (821) (1,915)
Net cash used in financing activities (8,518) (14,121)
Effect of exchange rates on cash and cash equivalents 35 335
Net decrease in cash and cash equivalents (4,858) (12,549)
Cash and cash equivalents:
Beginning of period 29,486 33,311
End of period 24,628 20,762
See Notes to unaudited consolidated financial statements.
Notes to the Consolidated Financial Statements
As of June 30, 2025 and December 31, 2024
1. Organization and description of business
Nature of business
Somero Enterprises, Inc. (the "Company" or "Somero") designs, assembles,
remanufactures, sells, and distributes concrete leveling, contouring, and
placing equipment, related parts and accessories, and training services
worldwide. Somero's Operations and Support Offices are located in Michigan,
USA with Global Headquarters and Training Facilities in Florida, USA. Sales
and service offices are in Chesterfield, England; Kampenhout, Belgium;
Melbourne, Australia and New Delhi, India.
2. Summary of significant accounting policies
Basis of presentation
The consolidated financial statements of the Company have been prepared in
accordance with accounting principles generally accepted in the United States
of America.
Principles of consolidation
The consolidated financial statements include the accounts of Somero
Enterprises, Inc., and its subsidiaries. All significant intercompany
transactions and accounts have been eliminated in consolidation.
Use of estimates
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the amounts reported
in the financial statements and accompanying notes. Actual results could
differ from those estimates.
Cash and cash equivalents
Cash includes cash on hand, cash in banks, and temporary investments with a
maturity of three months or less when purchased. The Company maintains
deposits in a number of financial institutions globally, which may at times
exceed amounts covered by insurance provided by the U.S. Federal Deposit
Insurance Corporation ("FDIC"). The Company has not experienced any losses
related to amounts in excess of FDIC limits.
Restricted Cash
Restricted cash of approximately US$ 329,000 and US$ 320,000 is included in
"Cash and cash equivalents" on the consolidated balance sheet as of June 30,
2025 and December 31, 2024. This represents cash deposited by the Company into
a guaranteed deposit account and designated as collateral for the building
lease in Australia and Belgium, in accordance with the lease agreement.
Accounts receivable and allowances for credit losses
Financial instruments which potentially subject the Company to concentrations
of credit risk consist primarily of accounts receivable. The Company's
accounts receivable are derived from revenue earned from a diverse group of
customers. The Company performs credit evaluations of its commercial customers
and maintains an allowance for credit losses based upon the expected ability
to collect accounts receivable. Allowances, if necessary, are established
for amounts determined to be uncollectible based on specific identification
and historical experience. As of June 30, 2025 and December 31, 2024, the
allowance for credit losses was approximately US$ 1,294,000 and US$ 1,194,000,
respectively. Provision for credit losses (recovery) for the six months
ended June 30, 2025 and 2024, was approximately US$ 100,000 and US$ (203,000),
respectively. The opening balance of accounts receivable on January 1, 2024
was US$ 9,266,000, which includes US$ 431,000 of non-current accounts
receivable.
Inventories
Inventories are stated using the first in, first out ("FIFO") method, at the
lower of cost or net realizable value ("NRV"). Provision for potentially
obsolete or slow-moving inventory is made based on management's analysis of
inventory levels and future sales forecasts. As of June 30, 2025 and
December 31, 2024, the provision for obsolete and slow-moving inventory was
approximately US$ 1,118,000 and US$ 1,163,000, respectively.
Intangible assets and goodwill
Intangible assets consist primarily of customer relationships, trademarks, and
patents, and are carried at their fair value when acquired, less accumulated
amortization. Intangible assets are amortized using the straight-line method
over a period of three to twelve years, which is their estimated period of
economic benefit.
Goodwill is not amortized but is subject to impairment tests on an annual
basis, and the Company has chosen December 31 as its periodic assessment
date. Goodwill represents the excess cost of the business combination over
the Company's interest in the fair value of the identifiable assets and
liabilities. Goodwill arose from the Company's prior sale from Dover
Corporation to The Gores Group in 2005 and the purchase of the Line Dragon,
LLC business assets in January 2019. The Company did not incur a goodwill
impairment loss for the periods ended June 30, 2025 nor December 31, 2024.
Revenue recognition
The Company generates revenue by selling equipment, parts, accessories,
service agreements and training. The Company recognizes revenue for equipment,
parts, and accessories when it satisfies the performance obligation of
transferring the control to the customer. For product sales where shipping
terms are FOB shipping point, revenue is recognized upon shipment. For
arrangements which include FOB destination shipping terms, revenue is
recognized upon delivery to the customer. The Company recognizes the revenue
for service agreements and training once the service or training has occurred.
As of June 30, 2025 and December 31, 2024, there were approximately US$
543,000 and US$ 520,000, respectively, of extended service agreement
liabilities. The opening balance of extended service agreement liabilities on
January 1, 2024 was US$ 600,000. During the six months ended June 30, 2025 and
2024, approximately US$ 313,000 and US$ 363,000, respectively, of revenue was
recognized related to the amounts recorded as liabilities on the balance
sheets in the prior year (deferred contract revenue).
As of June 30, 2025 and December 31, 2024, there were approximately US$
757,000 and US$ 505,000, respectively, in customer deposit liabilities for
advance payments received during the period for contracts expected to ship
following the end of the period. The opening balance of customer deposit
liabilities for advance payments received on January 1, 2024 was US$
1,635,000. As of June 30, 2025 and December 31, 2024, there are no significant
contract costs such as sales commissions or costs deferred. Interest income
on financing arrangements is recognized as interest accrues, using the
effective interest method.
Warranty liability
The Company provides warranties on all equipment sales ranging from 60 days to
three years, depending on the product. Warranty liabilities are estimated
net of the warranty passed through to the Company from vendors, based on
specific identification of issues and historical experience.
US$ 000
Balance, January 1, 2024 (1,290)
Warranty charges 497
Accruals (394)
Balance, December 31, 2024 (1,187)
Balance, January 1, 2025 (1,187)
Warranty charges 150
Accruals (226)
Balance, June 30, 2025 (1,263)
Property, plant, and equipment
Property, plant, and equipment is stated at cost, net of accumulated
depreciation and amortization. Land is not depreciated. Depreciation is
computed using the straight-line method over the estimated useful lives of the
assets, which is 31.5 to 40 years for buildings (depending on the nature of
the building), 15 years for improvements, and 3 to 10 years for machinery and
equipment.
Income taxes
The Company determines income taxes using the asset and liability approach.
Tax laws require items to be included in tax filings at different times than
the items are reflected in the consolidated financial statements. Deferred tax
assets and liabilities are recognized for the future tax consequences
attributable to temporary differences between the consolidated financial
statement carrying amounts of existing assets and liabilities and their
respective tax basis and operating loss and tax credit carry forwards.
Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect on deferred
tax assets and liabilities of a change in tax rates is recognized in income in
the period that includes the enactment date. Deferred tax assets are reduced
by a valuation allowance, if necessary, to the extent that it appears more
likely than not that such assets will be unrecoverable.
The Company evaluates tax positions that have been taken or are expected to be
taken in its tax returns and records a liability for uncertain tax
positions. This involves a two-step approach to recognizing and measuring
uncertain tax positions. First, tax positions are recognized if the weight
of available evidence indicates that it is more likely than not that the
position will be sustained upon examination, including resolution of related
appeals or litigation processes, if any. Second, the tax position is measured
as the largest amount of tax benefit that has a greater than 50% likelihood of
being realized upon settlement.
Stock-based compensation
The Company recognizes the cost of employee services received in exchange for
an award of equity instruments in the consolidated financial statements over
the period the employee is required to perform the services in exchange for
the award (presumptively the vesting period). The Company measures the cost
of employee services in exchange for an award based on the grant-date fair
value of the award. Compensation expense related to stock-based payments was
approximately US$ 394,000 and US$ 478,000 for the six months ended June 30,
2025 and 2024, respectively. In addition, the Company settled approximately
US$ 454,000 and US$ 713,000 in restricted stock units for cash during the six
months ended June 30, 2025 and 2024, respectively.
Transactions in and translation of foreign currency
The functional currency for the Company's subsidiaries outside the United
States is the applicable local currency. The preparation of the consolidated
financial statements requires the translation of these financial statements to
USD. Balance sheet amounts are translated at period-end exchange rates and
the statement of comprehensive income accounts are translated at average
rates. The resulting gains or losses are charged directly to accumulated
other comprehensive income. The Company is also exposed to market risks
related to fluctuations in foreign exchange rates because some sales
transactions, and some assets and liabilities of its foreign subsidiaries, are
denominated in foreign currencies other than the designated functional
currency. Gains and losses from transactions are included as foreign
exchange impact in the accompanying consolidated statements of comprehensive
income.
Comprehensive income
Comprehensive income is the combination of reported net income and other
comprehensive income ("OCI"). OCI is changes in equity of a business
enterprise during a period from transactions and other events and
circumstances from non-owner sources not included in net income.
Earnings per share
Basic earnings per share represents income available to common stockholders
divided by the weighted average number of common shares outstanding during the
year. Diluted earnings per share reflect additional common shares that would
have been outstanding if dilutive potential common shares had been issued
using the treasury stock method. Potential common shares that may be issued
by the Company relate to outstanding stock options and restricted stock units.
Earnings per common share have been computed based on the
following:
Six months ended June 30
2025 2024
US$ 000 US$ 000
Net income 2,592 8,141
Basic weighted shares outstanding 54,814,372 55,296,172
Net dilutive effect of stock options and restricted stock units 781,228 617,468
Diluted weighted average shares outstanding 55,595,601 55,913,640
Fair value
The carrying values of cash and cash equivalents, accounts receivable,
accounts payable, and other current assets and liabilities approximate fair
value because of the short-term nature of these instruments.
3. Inventories
Inventories consisted of the following:
June 30, December 31,
2025 2024
US$ 000 US$ 000
Raw material 11,086 10,229
Finished goods and work in process 9,851 5,974
Remanufactured 3,469 3,607
Total 24,406 18,816
4. Goodwill and intangible assets
Goodwill represents the excess of the cost of a business combination over the
fair value of the net assets acquired. The Company is required to test
goodwill for impairment, at the reporting unit level, annually and when events
or circumstances indicate the fair value of a unit may be below its carrying
value.
The following table reflects other intangible assets:
Weighted average June 30, December 31,
Amortization 2025 2024
Period US$ 000 US$ 000
Capitalized cost Patents 12 years 19,247
19,247
Intangible Assets 7,434 7,434
26,681 26,681
Accumulated amortization Patents 12 years 18,866 18,819
Intangible Assets 6,908 6,884
25,774 25,703
Net carrying costs Patents 12 years 381 428
Intangible Assets 526 550
907 978
Amortization expense associated with the intangible assets in each of the six
months ended June 30, 2025 and 2024 was approximately US$ 71,000 and US$
71,000, respectively. The amortization expense for each of the next 5 years
will be approximately US$ 142,000 and the remaining amortization thereafter
will be approximately US$ 197,000.
5. Property, plant, and equipment
Property, plant, and equipment consist of the following:
June 30, December 31,
2025 2024
US$ 000 US$ 000
Land 864 864
Building and improvements 26,356 26,291
Machinery and equipment 10,203 9,794
37,423 36,949
Less: accumulated depreciation and amortization (11,198) (10,186)
26,225 26,763
Depreciation expense for the six months ended June 30, 2025 and 2024 was
approximately US$ 1,051,000 and US$ 789,000, respectively.
6. Line of credit
In August 2022, the Company updated its credit facility to a US$ 25.0m secured
revolving line of credit, with a maturity date of August 2027. The interest
rate on the revolving credit line is based on the BSBY Index plus 1.25%. The
Company's credit facility is secured by substantially all its business assets.
No amounts were drawn under the secured revolving line of credit as of June
30, 2025 and December 31, 2024.
Interest expense for the six months ended June 30, 2025 and 2024 was
approximately US$ 19,500 and US$ 19,900, respectively, and relates primarily
to interest costs on leased vehicles.
7. Retirement program
The Company has a savings and retirement plan for its employees, which is
intended to qualify under Section 401(k) of the Internal Revenue Code ("IRC").
This savings and retirement plan provides for voluntary contributions by
participating employees, not to exceed maximum limits set forth by the IRC.
The Company's matching contributions vest immediately. The Company
contributed approximately US$ 539,000 and US$ 563,000 to the savings and
retirement plan during the six months ended June 30, 2025 and 2024,
respectively.
8. Leases
The Company leases property, vehicles, and equipment under leases accounted
for as operating and finance leases. The leases have remaining lease terms of
less than 1 year to 8 years, some of which include options for renewal. The
exercise of these renewal options is at the sole discretion of the Company.
The right-of-use assets and related liabilities presented on the Consolidated
Balance Sheets, reflect management's current expectations regarding the
exercise of renewal options. The components for lease expense were as
follows:
Six Months Ended Six Months Ended
June 30, 2025 June 30,
2024
US$ 000 US$ 000
Operating lease cost 279 260
Finance lease cost:
Amortization of right-of-use assets 118 183
Interest on lease liabilities 19 12
Total finance lease cost 137 195
As of June 30, 2025, the weighted average remaining lease term for finance and
operating leases was 2.7 years and 6.4 years, respectively, and the weighted
average discount rate was 8.8% and 6.0%, respectively. As of June 30, 2024,
the weighted average remaining lease term for finance and operating leases was
1.5 years and 6.3 years, respectively, and the weighted average discount rate
was 4.7% and 5.1%, respectively.
Maturities of lease liabilities represent the remaining six months for 2025
and the full 12 months of each successive period as follows:
Operating Leases Finance Leases
US$ 000 US$ 000
2025 242 158
2026 484 200
2027 484 143
2028 363 82
2029 277 17
Thereafter 833 -
Total 2,683 600
Less imputed interest (453) (71)
Total
2,230
529
9. Supplemental cash flow and non-cash financing disclosures
Six months ended June 30
2025 2024
US$ 000 US$ 000
Cash paid for interest 20 20
Cash paid for taxes 1,108 4,475
Finance lease liabilities arising from obtaining right-of-use assets 54 153
Operating lease liabilities arising from obtaining right-of-use assets (69) 869
10. Business and credit concentration
The Company's line of business could be significantly impacted by, among other
things, the state of the general economy, the Company's ability to continue to
protect its intellectual property rights, and the potential future growth of
competitors. Any of the foregoing may significantly affect management's
estimates and the Company's performance. On June 30, 2025 and December 31,
2024, the Company had two customers which represented 17% and three customers
that represented 19% of total accounts receivable, respectively.
11. Commitments and contingencies
The Company has entered into employment agreements with certain members of
senior management. The terms of these are for renewable one-year periods and
include non-compete and non-disclosure provisions as well as provide for
defined severance payments in the event of termination or change in control.
The Company is also subject to various unresolved legal actions which arise in
the normal course of its business. Although it is not possible to predict with
certainty the outcome of these unresolved legal actions or the range of
possible losses, the Company believes these unresolved legal actions will not
have a material effect on its consolidated financial statements.
12. Income taxes
The Company's total effective tax rate for the six months ended June 30, 2025
was 47%. The Company is subject to US federal income tax with a statutory
rate of 21%, as well as income tax of multiple state and foreign
jurisdictions. The increase in overall effective tax rate is due to a
valuation allowance placed on foreign deferred tax assets of $857,000. The
Company was formed in 2005. The statute of limitations for all federal,
foreign, and state income tax matters for tax years from 2019 forward is still
open. The Company has no federal, foreign, or state income tax returns
currently under examination.
As of June 30, 2025, and December 31, 2024 the Company had income tax
receivable of approximately US$ 817,000 and US$ 1,286,000, respectively.
On June 30, 2025, the Company had approximately US$ 1,145,000 in non-current
net deferred tax assets recorded on its balance sheet. In assessing the
realizability of deferred tax assets, management considers whether it is more
likely than not that some portion or all the deferred tax assets will not be
realized. The ultimate realization of the deferred tax assets is dependent
upon the generation of future taxable income during the periods in which those
temporary differences become deductible.
13. Revenues by geographic region and segment reporting
The Company sells its products to customers throughout the world. The
Company operates as a single reportable segment for financial reporting
purposes. While revenue is disaggregated by geography, the business in
managed and evaluated as a single operating segment by the Chief Operating
Decision Maker ("CODM"). This is because all geographic regions provide the
same types of products and services to a similar customer base, and the CODM
assesses financial performance and allocates resources on a consolidated basis
rather than by individual geography.
In making key decisions and allocating resources, the CODM primarily evaluates
the Company's consolidated profitability, with a focus on EBITDA, as this
metric provides a comprehensive view of operational performance. Revenue by
geography is reviewed to identify trends, but profitability remains the
primary measure of performance.
The accounting policies are the same in all geographies as described in the
summary of significant accounting policies. The chief operating decision
maker assesses performance and decides how to allocate resources based on
profitability reported on the income statement.
The following table shows the breakdown by geography during the six months
ended June 30, 2025 and 2024:
US$ 000 North America Europe Australia ROW((1)) Total
2025 2024 2025 2024 2025 2024 2025 2024 2025 2024
Boomed screeds ((2)) 11,027 13,610 1,315 3,130 630 1,536 292 768 13,264 19,044
Ride-on screeds ((3)) 4,878 7,331 949 1,865 333 682 908 772 7,068 10,650
Remanufactured machines 3,402 3,304 - 618 - - - 144 3,402 4,066
3-D Profiler System 2,327 3,857 - 110 352 306 - - 2,679 4,273
SkyScreed 350 - - - 316 - - - 666 -
Other ((5)) 9,832 10,733 1,216 1,337 517 707 1,184 1,029 12,749 13,806
Total 31,816 38,835 3,480 7,060 2,148 3,231 2,384 2,713 39,828 51,839
1. ROW includes Latin America, India, China, Middle East, Korea, and Southeast
Asia.
2. Boomed Screeds include the S-28EZ, S-22EZ, S-15R, S-10A, SRS-6, SRS-4 and
SRS-4e.
3. Ride-on Screeds include the S-940, S-940e, S-485, and S-158C.
4. Other includes parts, accessories, services and freight, as well as other
equipment such as the SkyStrip(®), Somero Broom + Cure(®), STS-11M Topping
Spreader, STS-11HC Topping Spreader, Copperhead, Somero Line Dragon®, Mini
Screed C and S-PS50.
14. Share buyback
In February 2025 and 2024, the Board authorized on-market share buyback
programs for such number of its listed shares of common stock as are equal to
US$ 2,000,000 for each program. The maximum price paid per common share was
no more than the higher of 105 percent of the average middle market closing
price of common share for the five business days preceding the date of the
share buyback, the price of the last independent trade and the highest current
independent purchase bid. As of June 30, 2025, the Company purchased 57,089
shares of common stock for an aggregate value of US$ 190,000 pursuant to the
share buyback program authorized in 2025, and 199,645 shares of common stock
for an aggregate value of US$ 631,000, which completed the share buyback
program authorized in 2024. The Company estimates the share buyback program
authorized in 2025 will be completed by the end of 2025. In connection with
the Company's share buyback programs authorized in 2025 and 2024, 231,941
shares held in treasury were cancelled in 2025.
14. Subsequent events
In preparing the consolidated financial statements, the Company has evaluated
all subsequent events and transactions for potential recognition or disclosure
through September 9, 2025, the date the consolidated financial statements were
available for issuance.
Dividend
The Board declared an interim dividend for the six months ended June 30, 2025
of 4.0 US cents per share. This dividend will be paid on October 17, 2025
to shareholders on the register as of September 19, 2025.
All dividends, including both ordinary and supplemental, have the option of
being paid in two currencies, GBP, and USD. In addition, there is also the
option of being paid by check or through CREST for either currency or
additionally via BACS for GBP payments. If no election is made, dividends
will be paid in USD and via Check. If shareholders wish to change their
current currency or payment methods, forms are available through Computershare
Investor Services PLC at
https://www-uk.computershare.com/Investor/#Help/PrintableForms
(https://www-uk.computershare.com/Investor/#Help/PrintableForms)
Distribution amount: $0.04 cents per share
Ex-dividend date: 18 September 2025
Dividend record date: 19 September 2025
Final day for currency election: 3 October 2025
Payment date: 17 October 2025
All dividends have the option of being paid in either GBP or USD. Payments
in USD can be paid by Check or through Crest. Payments in GBP can be paid via
Check, Crest and BACS. The default option if no election is made will be for
a USD payment via check. Should shareholders wish to change their current
currency or payment methods, forms are available through Computershare
Investor Services PLC at
https://www uk.computershare.com/Investor/#Help/PrintableForms
If shares are held as Depositary Interests through a broker or nominee, the
holding company must be contacted and advised of the payment preferences. Such
requests are subject to the terms and conditions of the broker or nominee.
Additional information on currency election and tax withholding can be found
at: https://investors.somero.com/aim-rule-26
(https://investors.somero.com/aim-rule-26) . Shareholders can also contact
Computershare Investor Services PLC by telephone at +44 (0370) 702 0000 or
email via webcorres@computershare.co.uk (mailto:webcorres@computershare.co.uk)
.
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