ALS Limited Grows FY25 Revenue to $3B, EBIT Up 4.7%, Plans $230M Lab Expansion

Robust Financial Performance Amid Mixed Market Conditions

ALS Limited has reported a strong set of results for the fiscal year ending March 31, 2025, with total revenue climbing 16% to nearly $3 billion. Underlying earnings before interest and tax (EBIT) increased by 4.7% to $515 million, reflecting the resilience of ALS’s diversified business model. The company maintained a solid underlying EBIT margin of 19.1% when excluding recent acquisitions, underscoring operational efficiency despite some margin dilution from new business additions.

Organic revenue growth of 4.9% was driven by improved demand in Life Sciences, particularly in Environmental and Food testing services, and Industrial Materials. The Minerals segment showed resilience with margins holding above 31%, supported by a global hub-and-spoke laboratory network that optimizes sample processing and client service.

Acquisition Integration and Strategic Expansion

ALS’s acquisition strategy continues to bear fruit, with the Nuvisan integration progressing ahead of schedule. The company achieved approximately €19 million in annualized cost savings by the end of FY25, six months earlier than planned, and is building a strong sales pipeline with increasing third-party contract wins. Similarly, acquisitions of Wessling and York are performing in line with expectations, contributing to future growth prospects.

Complementing its organic and acquisition-driven growth, ALS announced a $230 million capital investment program to expand four key hub laboratories located in Lima, Sydney, Bangkok, and Prague. These expansions, planned through to FY30, aim to double existing floor space and incorporate automation technologies to enhance operational efficiency and capacity, supporting ALS’s long-term growth ambitions.

Operational Strength and Market Positioning

The company’s Life Sciences division, representing 37% of group revenue, delivered a 9.8% organic growth in Environmental testing, with PFAS testing growing more than 2.5 times faster than the broader portfolio. This segment benefits from increasing regulatory scrutiny and enforcement globally. Meanwhile, the Commodities division maintained revenue stability despite subdued market conditions, with minerals margins sustained above 30% for the fourth consecutive year.

ALS’s operating model, based on global and regional hub-and-spoke laboratory networks, provides flexibility and cost management advantages. The company’s variable cost base and low consumables proportion mitigate risks from tariff changes and geopolitical uncertainties. ALS’s geographic diversification, with limited direct exposure to China and consumer goods sectors, further supports its resilience.

Financial Discipline and Shareholder Returns

Cash flow generation remains a highlight, with free cash flow before capital expenditure rising 13.1% to $590.6 million and EBITDA cash conversion improving to 95%. The leverage ratio stood at 2.3 times, at the upper end of the company’s target range, reflecting ongoing investments and acquisitions. ALS declared a final dividend of 19.7 cents per share, 30% franked, maintaining a payout ratio of 60% of underlying net profit after tax.

Looking ahead, ALS targets 5-7% organic revenue growth and margin expansion in FY26, with continued focus on acquisition integration, cost efficiencies, and capital investments. The company remains vigilant on regulatory changes, notably in Mexico’s pharmaceutical testing market, and broader macroeconomic uncertainties.