H.B. Fuller Company (FUL) is a global formulator, manufacturer and marketer of adhesives and other specialty chemical products. Project ONE, the IT systems upgrade (ERP) approved in 2012, is still not live for each business segment worldwide. Though the company notes it made progress in 2020, its new 10-K warns that the project will not be completed in 2021, nearly a decade after it began:

“During 2021 and beyond, we will continue implementation in North America, EIMEA and Asia Pacific.”

Evidence exists FUL may be reducing the scope of the upgrade, albeit slightly. The 2019 10-K puts the cost of the project north of $200 million:

“Total expenditures for Project ONE are estimated to be $195 to $210 million…”

The 2020 10-K reduces the cost of the implementation by approximately $25 million:

“Total expenditures for Project ONE are estimated to be $170 to $185 million…”

ERP implementations are notorious for running over budget and deadline; 79-percent of ERP implementations missed their promised deadlines and come in over schedule. 56-percent of ERP implementations come in over budget by 25-percent and 18-percent came in more than 25-percent over budget.

Since 2018, HB Fuller has been investigating the possible resale of products to Iran by certain customers of its subsidiaries in Turkey and India which may violate economic sanctions against Iran administered by the U.S. Department of the Treasury’s Office of Foreign Assets (OFAC). The company voluntarily contacted OFAC in 2018 and in the latest 10-K, disclosed OFAC’s response:

“In December 2020, we received formal notification from OFAC that it had completed its review of the company’s investigation and voluntary disclosure and that OFAC has decided to issue a Cautionary Letter instead of pursuing a civil monetary penalty or taking other enforcement action. While OFAC has indicated that future enforcement action is not precluded if additional information warrants renewed attention, the Cautionary Letter represents OFAC’s final enforcement response to our investigation and voluntary disclosure, so we now consider this matter closed.”