Company: UFPT
Filing Date: 2025-08-11
Form Type: 10-Q
Source: 0001171843-25-005268
Chunk: 92

Company: UFP TECHNOLOGIES INC
Filing Date: 2025-08-11
Form: 10-Q
Item: Part I, Item 2
Chunk 92
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 period in 2024. The increase in net sales is primarily due to increased sales to customers in the medical market of 46.0%, primarily due to sales from the 2024 and 2025 acquisitions, which collectively contributed approximately $35.7 million in sales during the second quarter. Organic sales growth for the second quarter was 4.9%. Organic growth in the medical market was approximately 10% and was fueled by strong sales virtually all segments including the robot assisted surgery market.

Net sales for the six months ended June 30, 2025 increased approximately 39.1% to $299.3 million from sales of $215.2 for the same period in 2024. The increase in net sales is primarily due to increased sales to customers in the medical market of 48.2%, primarily due to sales from the 2024 and 2025 acquisitions, which collectively contributed approximately $76.3 million in sales during the first half of the year. Organic sales growth for the first half of the year was 3.6%.

Gross Profit

Gross margin decreased to 28.8% for the three months ended June 30, 2025, from 30.0% for the same period in 2024. As a percentage of sales, material and labor costs collectively increased 0.4% and overhead costs increased 0.8%. As anticipated, we had significant inefficiency in our newly acquired AJR operations related to onboarding many new direct and indirect labor associates. We estimate this added $1.2 million to our cost-of-sales in the second quarter. It is anticipated that the inefficiency at AJR will continue but gradually improve for the balance of this year.

Gross margin decreased slightly to 28.6% for the six months ended June 30, 2025, from 29.3% for the same period in 2024. As a percentage of sales, material and labor costs collectively increased 0.3% and overhead costs increased 0.4%.

Selling, General and Administrative Expenses

Selling, general, and administrative expenses (“SG&A”) increased approximately 34.4% to $18.7 million for the three months ended June 30, 2025, from $13.9 million for the same period in 2024. The increase is primarily attributable to SG&A from the Company’s 2024 acquisitions. As a percentage of sales, SG&A decreased to 12.4% for the