Axalta Releases Third Quarter 2024 Results
Axalta Coating Systems reported record third quarter 2024 results with net sales of $1.32 billion, a 0.8% year-over-year increase. Net income rose 40% to $102 million with a 7.7% margin. The company achieved record Q3 Adjusted EBITDA of $291 million, with margin improving 220 basis points to 22.1%. Diluted EPS increased 39% to $0.46, while Adjusted Diluted EPS grew 31% to $0.59. Performance Coatings segment saw 2% growth, while Mobility Coatings declined 2%. The company repurchased $50 million of common shares and maintained strong liquidity of over $1.2 billion.
Axalta Coating Systems ha riportato risultati record per il terzo trimestre del 2024 con vendite nette di 1,32 miliardi di dollari, registrando un aumento dello 0,8% rispetto all'anno precedente. Il reddito netto è aumentato del 40% raggiungendo 102 milioni di dollari con un margine del 7,7%. L'azienda ha raggiunto un EBITDA rettificato record per il Q3 di 291 milioni di dollari, con un margine migliorato di 220 punti base, arrivando al 22,1%. L'EPS diluito è aumentato del 39%, raggiungendo $0,46, mentre l'EPS diluito rettificato è cresciuto del 31%, toccando $0,59. Il segmento delle rivestimenti per prestazioni ha visto una crescita del 2%, mentre il segmento dei rivestimenti per la mobilità ha registrato un calo del 2%. L'azienda ha riacquistato azioni ordinarie per 50 milioni di dollari, mantenendo una solida liquidità di oltre 1,2 miliardi di dollari.
Axalta Coating Systems reportó resultados récord en el tercer trimestre de 2024 con ventas netas de 1.32 mil millones de dólares, un aumento del 0.8% en comparación con el año anterior. El ingreso neto aumentó un 40% a 102 millones de dólares con un margen del 7.7%. La compañía alcanzó un EBITDA ajustado récord para el Q3 de 291 millones de dólares, mejorando el margen en 220 puntos básicos al 22.1%. El EPS diluido aumentó un 39% a $0.46, mientras que el EPS diluido ajustado creció un 31% a $0.59. El segmento de recubrimientos de desempeño vio un crecimiento del 2%, mientras que el segmento de recubrimientos para movilidad disminuyó un 2%. La empresa recompró acciones ordinarias por un valor de 50 millones de dólares y mantuvo una sólida liquidez de más de 1.2 mil millones de dólares.
Axalta Coating Systems는 2024년 3분기 기록적인 실적을 보고했습니다. 순매출은 한화 1조 3200억 원으로 전년 대비 0.8% 증가했습니다. 순이익은 40% 증가하여 102백만 달러에 도달하였고, 마진은 7.7%였습니다. 회사는 3분기 조정 EBITDA에서 291백만 달러라는 기록을 달성했으며, 마진은 220 베이시스 포인트 개선되어 22.1%에 달했습니다. 희석 주당순이익(EPS)은 39% 증가하여 0.46달러에, 조정 희석 EPS는 31% 증가하여 0.59달러에 달했습니다. 성능 코팅 부문은 2% 성장하였고, 모빌리티 코팅 부문은 2% 감소했습니다. 회사는 5천만 달러의 보통주를 재매입하였고, 12억 달러 이상의 높은 유동성을 유지하고 있습니다.
Axalta Coating Systems a annoncé des résultats record pour le troisième trimestre 2024 avec des ventes nettes de 1,32 milliard de dollars, représentant une augmentation de 0,8% par rapport à l'année précédente. Le bénéfice net a augmenté de 40% pour atteindre 102 millions de dollars avec une marge de 7,7%. L'entreprise a atteint un EBITDA ajusté record pour le T3 de 291 millions de dollars, avec une amélioration de la marge de 220 points de base, se chiffrant à 22,1%. Le BPA dilué a augmenté de 39% pour atteindre 0,46 $ et le BPA dilué ajusté a crû de 31% pour atteindre 0,59 $. Le segment des revêtements de performance a connu une croissance de 2%, tandis que celui des revêtements de mobilité a diminué de 2%. L'entreprise a racheté des actions ordinaires pour 50 millions de dollars et a maintenu une solide liquidité de plus de 1,2 milliard de dollars.
Axalta Coating Systems berichtete über rekordverdächtige Ergebnisse für das dritte Quartal 2024 mit Nettoumsätzen von 1,32 Milliarden Dollar, einem Anstieg von 0,8% im Jahresvergleich. Der Nettogewinn stieg um 40% auf 102 Millionen Dollar bei einer Marge von 7,7%. Das Unternehmen erzielte ein rekordverdächtiges Q3 Adjusted EBITDA von 291 Millionen Dollar, wobei die Marge um 220 Basispunkte auf 22,1% gesteigert wurde. Der verwässerte Gewinn pro Aktie stieg um 39% auf 0,46 Dollar, während der angepasste verwässerte Gewinn pro Aktie um 31% auf 0,59 Dollar anwuchs. Der Bereich Leistungsbeschichtungen verzeichnete ein Wachstum von 2%, während der Bereich Mobilitätsbeschichtungen um 2% zurückging. Das Unternehmen hat Stammaktien im Wert von 50 Millionen Dollar zurückgekauft und eine starke Liquidität von über 1,2 Milliarden Dollar aufrechterhalten.
- Record Q3 net sales of $1.32 billion
- Net income increased 40% YoY to $102 million
- Record Q3 Adjusted EBITDA of $291 million, up 12% YoY
- Adjusted EBITDA margin improved 220 basis points to 22.1%
- Diluted EPS increased 39% to $0.46
- Strong liquidity position over $1.2 billion
- Net leverage ratio improved to 2.7x from 3.2x YoY
- Cash from operations decreased to $194 million from $210 million YoY
- Commercial Vehicle sales decreased 8% YoY
- Mobility Coatings price-mix declined 3% YoY
- Industrial net sales decreased 1% YoY
Insights
The Q3 results demonstrate strong financial performance with several notable achievements. Net sales reached a record $1.32 billion, while net income surged 40% to $102 million. The
Key financial metrics show operational efficiency improvements:
- Strong liquidity position with
$567 million cash and$1.2 billion total liquidity - Reduced leverage ratio from 3.2x to 2.7x year-over-year
- Continued shareholder returns through
$50 million in share repurchases
Segment performance reveals mixed market dynamics. The Performance Coatings division shows resilience with
Market positioning remains strong with:
- Net new body shop wins in Refinish
- Successful integration of CoverFlexx acquisition
- Volume growth in Light Vehicle segment despite raw material headwinds
PHILADELPHIA, Oct. 30, 2024 (GLOBE NEWSWIRE) -- Axalta Coating Systems Ltd. (NYSE:AXTA) (“Axalta”), a leading global coatings company, announced its financial results for the third quarter ended September 30, 2024.
Third Quarter 2024 Highlights:
- Record third quarter net sales of
$1.32 billion - Net income increased
40% year over year to$102 million ; net income margin of7.7% - Record third quarter Adjusted EBITDA of
$291 million - Adjusted EBITDA margin improved 220 basis points year over year to
22.1% - Diluted EPS increased
39% year over year to$0.46 and Adjusted Diluted EPS increased31% year over year to$0.59 - Repurchased
$50 million of common shares
Third Quarter 2024 Consolidated Financial Results
Third quarter 2024 net sales increased
Net income increased by
Third quarter 2024 cash provided by operating activities was
Discussion of Segment Results
Performance Coatings third quarter 2024 net sales were
Performance Coatings generated third quarter Adjusted EBITDA of
Mobility Coatings third quarter 2024 net sales were
The Mobility Coatings segment generated Adjusted EBITDA of
“Our results in the third quarter were exceptional,” said Chris Villavarayan, CEO and President of Axalta. “I am extremely proud of the commitment and dedication from each of our employees to deliver a record third quarter for the company in net sales and Adjusted EBITDA, despite macroeconomic headwinds in all four end markets. As One Axalta, we are successfully executing on our 2026 A Plan and outperforming against key industry benchmarks as we remain dedicated to unlocking our full earnings potential.”
Full Year 2024 Outlook
| (in millions, except %’s and per share data) | Full Year 2024 | ||
| Item | |||
| Net Sales | ~ | ||
| Adjusted EBITDA | ~ | ||
| Adjusted Diluted EPS | |||
| Free Cash Flow | ~ | ||
| D&A (step-up D&A) | ~ | ||
| Tax Rate, As Adjusted | ~ | ||
| Diluted Shares Outstanding | ~220 | ||
| Interest Expense | ~ | ||
| Capex | ~ | ||
Axalta does not provide a reconciliation for non-GAAP estimates for Adjusted EBITDA, Adjusted Diluted EPS, Free Cash Flow or tax rate, as adjusted, on a forward-looking basis because the information necessary to calculate a meaningful or accurate estimation of reconciling items is not available without unreasonable effort. See “Non-GAAP Financial Measures” for more information.
Conference Call Information
Axalta will hold a conference call to discuss its third quarter 2024 financial results on Wednesday, October 30, 2024, at 8:00 a.m. ET. A live webcast of the conference call will be available online at www.axalta.com/investorcall. A replay of the webcast will be posted shortly after the call and will remain accessible through October 30, 2025. The dial-in phone number for the conference call is 1-800-267-6316 and the conference ID is AXALTA. For those unable to participate, a replay will be available through November 6, 2024. The replay dial-in number is +1-844-512-2921. The replay passcode is 11157263.
Cautionary Statement Concerning Forward-Looking Statements
This release may contain certain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 regarding Axalta and its subsidiaries including, but not limited to, statements regarding our previously announced three-year 2024-2026 strategy (the “2026 A Plan”), and our outlook and/or guidance, which includes net sales, Adjusted EBITDA, Adjusted Diluted EPS, Free Cash Flow, depreciation and amortization (“D&A”), step-up D&A, tax rate, as adjusted, diluted shares outstanding, interest expense, and capital expenditures. Axalta has identified some of these forward-looking statements with words such as “outlook,” “potential,” and “plan,” and the negative of these words or other comparable or similar terminology. All of these statements are based on management’s expectations as well as estimates and assumptions prepared by management that, although they believe to be reasonable, are inherently uncertain. These statements involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors outside of Axalta’s control, as well as risks related to the execution of, and assumptions underlying, our previously-announced transformation initiative and the 2026 A Plan, that may cause its business, industry, strategy, financing activities or actual results to differ materially. More information on potential factors that could affect Axalta’s financial results is available in “Forward-Looking Statements,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” within Axalta’s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, and in other documents that we have filed with, or furnished to, the U.S. Securities and Exchange Commission. Axalta undertakes no obligation to update or revise any of the forward-looking statements contained herein, whether as a result of new information, future events or otherwise.
Non-GAAP Financial Measures
This release includes financial information that is not presented in accordance with generally accepted accounting principles in the United States (“GAAP”), including Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Diluted EPS, adjusted net income, Free Cash Flow, total net leverage ratio, tax rate, as adjusted, and Adjusted EBIT. Management uses Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Diluted EPS, adjusted net income, tax rate, as adjusted, and Adjusted EBIT in the analysis of our financial and operating performance because they assist in the evaluation of underlying trends in our business. Management uses Free Cash Flow and total net leverage ratio in the analysis of (1) our liquidity, (2) our ability to incur and service our debt and (3) strategic capital allocation decisions. Adjusted EBITDA, Adjusted Diluted EPS, adjusted net income and Adjusted EBIT consist of EBITDA, Diluted EPS, net income attributable to common shareholders and EBIT, respectively, adjusted for (i) certain non-cash items included within net income, (ii) certain items Axalta does not believe are indicative of ongoing operating performance or (iii) certain nonrecurring, unusual or infrequent items that have not otherwise occurred within the last two years or we believe are not reasonably likely to recur within the next two years. Free cash flow consists of cash provided by (used for) operating activities less purchase of property, plant and equipment plus interest proceeds on swaps designated as net investment hedges. Total net leverage ratio consists of net debt divided by Adjusted EBITDA, with net debt defined as total debt less cash and cash equivalents. We believe that making the foregoing adjustments provides investors meaningful information to understand our operating results and ability to analyze financial and business trends on a period-to-period basis. The non-GAAP financial measures used by Axalta may differ from similarly titled measures reported by other companies. Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Diluted EPS, adjusted net income, Free Cash Flow, total net leverage ratio, tax rate, as adjusted and Adjusted EBIT should not be considered as alternatives to net sales, net income (loss), income (loss) from operations or any other financial measures derived in accordance with GAAP. These non-GAAP financial measures have important limitations as analytical tools and should be considered in conjunction with, and not as substitutes for, our results as reported under GAAP. This release includes a reconciliation of certain non-GAAP financial measures with the most directly comparable financial measures calculated in accordance with GAAP. Axalta does not provide a reconciliation for Adjusted EBITDA, Adjusted Diluted EPS, tax rate, as adjusted, or Free Cash Flow on a forward-looking basis because the information necessary to calculate a meaningful or accurate estimation of reconciling items is not available without unreasonable effort. For example, such reconciling items include the impact of foreign currency exchange gains or losses, gains or losses that are unusual or nonrecurring in nature, as well as discrete taxable events. These items are uncertain, depend on various factors and may have a substantial and unpredictable impact on our GAAP results.
Segment Financial Measures
The primary measure of segment operating performance is Adjusted EBITDA, which is a key metric that is used by management to evaluate business performance in comparison to budgets, forecasts and prior year financial results and that management believes reflects Axalta’s core operating performance. As we do not measure segment operating performance based on net income, a reconciliation of this non-GAAP financial measure with the most directly comparable financial measure calculated in accordance with GAAP is not available. Beginning with the fourth quarter of 2023, we replaced Adjusted EBIT with Adjusted EBITDA as the primary measure of segment operating performance. As previously disclosed, we will continue publishing segment Adjusted EBIT through 2024 to allow for historical trend analyses.
About Axalta Coating Systems
Axalta is a global leader in the coatings industry, providing customers with innovative, colorful, beautiful and sustainable coatings solutions. From light vehicles, commercial vehicles and refinish applications to electric motors, building facades and other industrial applications, our coatings are designed to prevent corrosion, increase productivity and enhance durability. With more than 150 years of experience in the coatings industry, the global team at Axalta continues to find ways to serve our more than 100,000 customers in over 140 countries better every day with the finest coatings, application systems and technology. For more information visit axalta.com and follow us @axalta on X.
| Financial Statement Tables | |||||||||||||
| AXALTA COATING SYSTEMS LTD. | |||||||||||||
| Condensed Consolidated Statements of Operations (Unaudited) | |||||||||||||
| (In millions, except per share data) | |||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||
| Net sales | $ | 1,320 | $ | 1,309 | $ | 3,965 | $ | 3,887 | |||||
| Cost of goods sold | 858 | 886 | 2,614 | 2,692 | |||||||||
| Selling, general and administrative expenses | 211 | 209 | 631 | 625 | |||||||||
| Other operating charges | 15 | 13 | 78 | 22 | |||||||||
| Research and development expenses | 19 | 18 | 55 | 56 | |||||||||
| Amortization of acquired intangibles | 24 | 20 | 68 | 66 | |||||||||
| Income from operations | 193 | 163 | 519 | 426 | |||||||||
| Interest expense, net | 54 | 55 | 158 | 158 | |||||||||
| Other (income) expense, net | (3 | ) | 5 | 4 | 15 | ||||||||
| Income before income taxes | 142 | 103 | 357 | 253 | |||||||||
| Provision for income taxes | 40 | 30 | 103 | 58 | |||||||||
| Net income | 102 | 73 | 254 | 195 | |||||||||
| Less: Net income attributable to noncontrolling interests | 1 | 1 | — | 1 | |||||||||
| Net income attributable to common shareholders | $ | 101 | $ | 72 | $ | 254 | $ | 194 | |||||
| Basic net income per share | $ | 0.46 | $ | 0.33 | $ | 1.15 | $ | 0.88 | |||||
| Diluted net income per share | $ | 0.46 | $ | 0.33 | $ | 1.15 | $ | 0.87 | |||||
| Basic weighted average shares outstanding | 218.9 | 221.0 | 219.8 | 221.3 | |||||||||
| Diluted weighted average shares outstanding | 219.9 | 221.9 | 220.8 | 222.1 | |||||||||
| AXALTA COATING SYSTEMS LTD. | ||||||||
| Condensed Consolidated Balance Sheets (Unaudited) | ||||||||
| (In millions, except per share data) | ||||||||
| September 30, 2024 | December 31, 2023 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 567 | $ | 700 | ||||
| Restricted cash | 4 | 3 | ||||||
| Accounts and notes receivable, net | 1,298 | 1,260 | ||||||
| Inventories | 818 | 741 | ||||||
| Prepaid expenses and other current assets | 151 | 117 | ||||||
| Total current assets | 2,838 | 2,821 | ||||||
| Property, plant and equipment, net | 1,188 | 1,204 | ||||||
| Goodwill | 1,718 | 1,591 | ||||||
| Identifiable intangibles, net | 1,207 | 1,130 | ||||||
| Other assets | 549 | 526 | ||||||
| Total assets | $ | 7,500 | $ | 7,272 | ||||
| Liabilities, Shareholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 708 | $ | 725 | ||||
| Current portion of borrowings | 20 | 26 | ||||||
| Other accrued liabilities | 694 | 677 | ||||||
| Total current liabilities | 1,422 | 1,428 | ||||||
| Long-term borrowings | 3,505 | 3,478 | ||||||
| Accrued pensions | 244 | 252 | ||||||
| Deferred income taxes | 163 | 162 | ||||||
| Other liabilities | 215 | 179 | ||||||
| Total liabilities | 5,549 | 5,499 | ||||||
| Shareholders’ equity: | ||||||||
| Common shares, | 254 | 254 | ||||||
| Capital in excess of par | 1,590 | 1,568 | ||||||
| Retained earnings | 1,540 | 1,286 | ||||||
| Treasury shares, at cost, 36.4 and 33.6 shares at September 30, 2024 and December 31, 2023, respectively | (1,037 | ) | (937 | ) | ||||
| Accumulated other comprehensive loss | (442 | ) | (444 | ) | ||||
| Total Axalta shareholders’ equity | 1,905 | 1,727 | ||||||
| Noncontrolling interests | 46 | 46 | ||||||
| Total shareholders’ equity | 1,951 | 1,773 | ||||||
| Total liabilities and shareholders’ equity | $ | 7,500 | $ | 7,272 | ||||
| AXALTA COATING SYSTEMS LTD. | ||||||||
| Condensed Consolidated Statements of Cash Flows (Unaudited) | ||||||||
| (In millions) | ||||||||
| Nine Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| Operating activities: | ||||||||
| Net income | $ | 254 | $ | 195 | ||||
| Adjustment to reconcile net income to cash provided by operating activities: | ||||||||
| Depreciation and amortization | 207 | 207 | ||||||
| Amortization of deferred financing costs and original issue discount | 6 | 7 | ||||||
| Debt extinguishment and refinancing-related costs | 3 | 7 | ||||||
| Deferred income taxes | 10 | (8 | ) | |||||
| Realized and unrealized foreign exchange losses, net | 12 | 21 | ||||||
| Stock-based compensation | 21 | 19 | ||||||
| Impairment charges | — | 15 | ||||||
| Interest income on swaps designated as net investment hedges | (10 | ) | (9 | ) | ||||
| Other non-cash, net | 5 | 25 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Trade accounts and notes receivable | (16 | ) | (213 | ) | ||||
| Inventories | (54 | ) | 66 | |||||
| Prepaid expenses and other assets | (106 | ) | (68 | ) | ||||
| Accounts payable | (18 | ) | 17 | |||||
| Other accrued liabilities | (2 | ) | 9 | |||||
| Other liabilities | 30 | (1 | ) | |||||
| Cash provided by operating activities | 342 | 289 | ||||||
| Investing activities: | ||||||||
| Acquisitions, net of cash acquired | (290 | ) | — | |||||
| Purchase of property, plant and equipment | (78 | ) | (105 | ) | ||||
| Interest proceeds on swaps designated as net investment hedges | 10 | 9 | ||||||
| Settlement proceeds on swaps designated as net investment hedges | — | 29 | ||||||
| Payments for loans to customers | (21 | ) | (1 | ) | ||||
| Other investing activities, net | 5 | 3 | ||||||
| Cash used for investing activities | (374 | ) | (65 | ) | ||||
| Financing activities: | ||||||||
| Proceeds from short-term borrowings | — | 9 | ||||||
| Proceeds from long-term borrowings | 292 | 197 | ||||||
| Payments on short-term borrowings | (5 | ) | (40 | ) | ||||
| Payments on long-term borrowings | (273 | ) | (359 | ) | ||||
| Financing-related costs | (5 | ) | (9 | ) | ||||
| Purchases of common stock | (100 | ) | (50 | ) | ||||
| Net cash flows associated with stock-based awards | 1 | 7 | ||||||
| Deferred acquisition-related consideration | — | (8 | ) | |||||
| Other financing activities, net | — | 1 | ||||||
| Cash used for financing activities | (90 | ) | (252 | ) | ||||
| Decrease in cash | (122 | ) | (28 | ) | ||||
| Effect of exchange rate changes on cash | (10 | ) | (19 | ) | ||||
| Cash at beginning of period | 703 | 655 | ||||||
| Cash at end of period | $ | 571 | $ | 608 | ||||
| Cash at end of period reconciliation: | ||||||||
| Cash and cash equivalents | $ | 567 | $ | 606 | ||||
| Restricted cash | 4 | 2 | ||||||
| Cash at end of period | $ | 571 | $ | 608 | ||||
The following table reconciles net income to EBITDA and Adjusted EBITDA for the periods presented (in millions):
| Three Months Ended September 30, | Twelve Months Ended September 30, 2024 | Nine Months Ended September 30, | Year Ended December 31, 2023 | |||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||
| Net income | $ | 102 | $ | 73 | $ | 328 | $ | 254 | $ | 195 | $ | 269 | ||||||||||||
| Interest expense, net | 54 | 55 | 213 | 158 | 158 | 213 | ||||||||||||||||||
| Provision for income taxes | 40 | 30 | 131 | 103 | 58 | 86 | ||||||||||||||||||
| Depreciation and amortization | 71 | 71 | 276 | 207 | 207 | 276 | ||||||||||||||||||
| EBITDA | 267 | 229 | 948 | 722 | 618 | 844 | ||||||||||||||||||
| Debt extinguishment and refinancing-related costs(a) | — | 4 | 6 | 3 | 7 | 10 | ||||||||||||||||||
| Termination benefits and other employee-related costs(b) | 11 | 12 | 71 | 67 | 14 | 18 | ||||||||||||||||||
| Acquisition and divestiture-related costs(c) | 4 | 1 | 10 | 8 | 1 | 3 | ||||||||||||||||||
| Site closure costs(d) | — | 2 | 4 | 1 | 4 | 7 | ||||||||||||||||||
| Impairment charges(e) | — | — | — | — | 15 | 15 | ||||||||||||||||||
| Foreign exchange remeasurement losses(f) | — | 7 | 12 | 8 | 19 | 23 | ||||||||||||||||||
| Long-term employee benefit plan adjustments(g) | 3 | 3 | 10 | 8 | 7 | 9 | ||||||||||||||||||
| Stock-based compensation(h) | 7 | 5 | 28 | 21 | 19 | 26 | ||||||||||||||||||
| Environmental charge(i) | — | — | 4 | 4 | — | — | ||||||||||||||||||
| Other adjustments(j) | (1 | ) | (2 | ) | (2 | ) | (1 | ) | (3 | ) | (4 | ) | ||||||||||||
| Adjusted EBITDA | $ | 291 | $ | 261 | $ | 1,091 | $ | 841 | $ | 701 | $ | 951 | ||||||||||||
| Net sales | $ | 1,320 | $ | 1,309 | $ | 5,262 | $ | 3,965 | $ | 3,887 | $ | 5,184 | ||||||||||||
| Net income margin | 7.7 | % | 5.6 | % | 6.2 | % | 6.4 | % | 5.0 | % | 5.2 | % | ||||||||||||
| Adjusted EBITDA margin | 22.1 | % | 19.9 | % | 20.7 | % | 21.2 | % | 18.0 | % | 18.4 | % | ||||||||||||
| Segment Adjusted EBITDA: | ||||||||||||||||||||||||
| Performance Coatings | $ | 221 | $ | 200 | $ | 832 | $ | 640 | $ | 550 | $ | 742 | ||||||||||||
| Mobility Coatings | 70 | 61 | 259 | 201 | 151 | 209 | ||||||||||||||||||
| Total | $ | 291 | $ | 261 | $ | 1,091 | $ | 841 | $ | 701 | $ | 951 | ||||||||||||
| (a) | Represents expenses and associated changes to estimates related to the prepayment, restructuring, and refinancing of our indebtedness, which are not considered indicative of our ongoing operating performance. |
| (b) | Represents expenses and associated changes to estimates related to employee termination benefits, consulting, legal and other employee-related costs associated with restructuring programs and other employee-related costs. These amounts are not considered indicative of our ongoing operating performance. |
| (c) | Represents acquisition and divestiture-related expenses and integration activities associated with our business combinations, all of which are not considered indicative of our ongoing operating performance. |
| (d) | Represents costs related to the closure of certain manufacturing sites, which we do not consider indicative of our ongoing operating performance. |
| (e) | Represents impairment charges, which are not considered indicative of our ongoing operating performance. The losses recorded during the nine months ended September 30, 2023 and year ended December 31, 2023 were primarily due to the decision to demolish assets at a previously closed manufacturing site during the three months ended June 30, 2023 and the then anticipated exit of a non-core business category in the Mobility Coatings segment during the three months ended March 31, 2023. |
| (f) | Represents foreign exchange losses resulting from the remeasurement of assets and liabilities denominated in foreign currencies, net of the impacts of our foreign currency instruments used to hedge our balance sheet exposures. |
| (g) | Represents the non-cash, non-service cost components of long-term employee benefit costs. |
| (h) | Represents non-cash impacts associated with stock-based compensation. |
| (i) | Represents costs related to certain environmental remediation activities, which are not considered indicative of our ongoing operating performance. |
| (j) | Represents costs for certain non-operational or non-cash losses (gains), unrelated to our core business and which we do not consider indicative of our ongoing operating performance. |
The following table reconciles net income to adjusted net income for the periods presented (in millions, except per share data):
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net income | $ | 102 | $ | 73 | $ | 254 | $ | 195 | ||||||||
| Less: Net income attributable to noncontrolling interests | 1 | 1 | — | 1 | ||||||||||||
| Net income attributable to common shareholders | 101 | 72 | 254 | 194 | ||||||||||||
| Debt extinguishment and refinancing-related costs(a) | — | 4 | 3 | 7 | ||||||||||||
| Termination benefits and other employee-related costs(b) | 11 | 12 | 67 | 14 | ||||||||||||
| Acquisition and divestiture-related costs(c) | 4 | 1 | 8 | 1 | ||||||||||||
| Impairment charges(d) | — | — | — | 15 | ||||||||||||
| Accelerated depreciation and site closure costs(e) | 2 | 2 | 4 | 4 | ||||||||||||
| Environmental charge(f) | — | — | 4 | — | ||||||||||||
| Other adjustments(g) | (1 | ) | (2 | ) | (1 | ) | (3 | ) | ||||||||
| Step-up depreciation and amortization(h) | 11 | 13 | 36 | 43 | ||||||||||||
| Total adjustments | 27 | 30 | 121 | 81 | ||||||||||||
| Income tax provision impacts(i) | (1 | ) | 4 | 13 | 21 | |||||||||||
| Adjusted net income | $ | 129 | $ | 98 | $ | 362 | $ | 254 | ||||||||
| Adjusted diluted net income per share | $ | 0.59 | $ | 0.45 | $ | 1.64 | $ | 1.14 | ||||||||
| Diluted weighted average shares outstanding | 219.9 | 221.9 | 220.8 | 222.1 | ||||||||||||
| (a) | Represents expenses and associated changes to estimates related to the prepayment, restructuring, and refinancing of our indebtedness, which are not considered indicative of our ongoing operating performance. |
| (b) | Represents expenses and associated changes to estimates related to employee termination benefits, consulting, legal and other employee-related costs associated with restructuring programs and other employee-related costs. These amounts are not considered indicative of our ongoing operating performance. |
| (c) | Represents acquisition and divestiture-related expenses and integration activities associated with our business combinations, all of which are not considered indicative of our ongoing operating performance. |
| (d) | Represents impairment charges, which are not considered indicative of our ongoing operating performance. The losses recorded during the nine months ended September 30, 2023 were primarily due to the decision to demolish assets at a previously closed manufacturing site during the three months ended June 30, 2023 and the then anticipated exit of a non-core business category in the Mobility Coatings segment during the three months ended March 31, 2023. |
| (e) | Represents incremental depreciation expense resulting from truncated useful lives of the assets impacted by our manufacturing footprint assessments and costs related to the closure of certain manufacturing sites, which we do not consider indicative of our ongoing operating performance. |
| (f) | Represents costs related to certain environmental remediation activities, which are not considered indicative of our ongoing operating performance. |
| (g) | Represents costs for certain non-operational or non-cash losses (gains), unrelated to our core business and which we do not consider indicative of our ongoing operating performance. |
| (h) | Represents the incremental step-up depreciation and amortization expense associated with the acquisition of DuPont Performance Coatings by Axalta. We believe this will assist investors in performing meaningful comparisons of past, present and future operating results and better highlight the results of our ongoing operating performance. |
| (i) | The income tax impacts are determined using the applicable rates in the taxing jurisdictions in which expense or income occurred and includes both current and deferred income tax expense (benefit) based on the nature of the non-GAAP performance measure. Additionally, the income tax impact includes the removal of discrete income tax impacts within our effective tax rate which were expenses of |
The following table reconciles cash provided by (used for) operating activities to free cash flow for the periods presented (in millions):
| Three Months Ended March 31, | Three Months Ended June 30, | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||||
| Cash provided by (used for) operating activities | $ | 34 | $ | (52 | ) | $ | 114 | $ | 131 | $ | 194 | $ | 210 | $ | 342 | $ | 289 | |||||||||||||||
| Purchase of property, plant and equipment | (22 | ) | (42 | ) | (23 | ) | (32 | ) | (33 | ) | (31 | ) | (78 | ) | (105 | ) | ||||||||||||||||
| Interest proceeds on swaps designated as net investment hedges | 3 | 6 | 4 | — | 3 | 3 | 10 | 9 | ||||||||||||||||||||||||
| Free cash flow | $ | 15 | $ | (88 | ) | $ | 95 | $ | 99 | $ | 164 | $ | 182 | $ | 274 | $ | 193 | |||||||||||||||
The following table reconciles income from operations to adjusted EBIT and segment adjusted EBIT for the periods presented (in millions):
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Income from operations | $ | 193 | $ | 163 | $ | 519 | $ | 426 | ||||||||
| Other (income) expense, net | (3 | ) | 5 | 4 | 15 | |||||||||||
| Total | 196 | 158 | 515 | 411 | ||||||||||||
| Debt extinguishment and refinancing-related costs(a) | — | 4 | 3 | 7 | ||||||||||||
| Termination benefits and other employee-related costs(b) | 11 | 12 | 67 | 14 | ||||||||||||
| Acquisition and divestiture-related costs(c) | 4 | 1 | 8 | 1 | ||||||||||||
| Impairment charges(d) | — | — | — | 15 | ||||||||||||
| Accelerated depreciation and site closure costs(e) | 2 | 2 | 4 | 4 | ||||||||||||
| Environmental charge(f) | — | — | 4 | — | ||||||||||||
| Other adjustments(g) | (1 | ) | (2 | ) | (1 | ) | (3 | ) | ||||||||
| Step-up depreciation and amortization(h) | 11 | 13 | 36 | 43 | ||||||||||||
| Adjusted EBIT | $ | 223 | $ | 188 | $ | 636 | $ | 492 | ||||||||
| Segment Adjusted EBIT(1): | ||||||||||||||||
| Performance Coatings | $ | 160 | $ | 135 | $ | 456 | $ | 362 | ||||||||
| Mobility Coatings | 52 | 40 | 144 | 87 | ||||||||||||
| Total | 212 | 175 | 600 | 449 | ||||||||||||
| Step-up depreciation and amortization(h) | 11 | 13 | 36 | 43 | ||||||||||||
| Adjusted EBIT | $ | 223 | $ | 188 | $ | 636 | $ | 492 | ||||||||
| (1) | During the three months ended December 31, 2023, Axalta transitioned to using Adjusted EBITDA as the primary measure to evaluate financial performance of the operating segments and allocate resources. We will continue publishing segment Adjusted EBIT through 2024 to allow for historical trend analyses. |
| (a) | Represents expenses and associated changes to estimates related to the prepayment, restructuring, and refinancing of our indebtedness, which are not considered indicative of our ongoing operating performance. |
| (b) | Represents expenses and associated changes to estimates related to employee termination benefits, consulting, legal and other employee-related costs associated with restructuring programs and other employee-related costs. These amounts are not considered indicative of our ongoing operating performance. |
| (c) | Represents acquisition and divestiture-related expenses and integration activities associated with our business combinations, all of which are not considered indicative of our ongoing operating performance. |
| (d) | Represents impairment charges, which are not considered indicative of our ongoing operating performance. The losses recorded during the nine months ended September 30, 2023 were primarily due to the decision to demolish assets at a previously closed manufacturing site during the three months ended June 30, 2023 and the then anticipated exit of a non-core business category in the Mobility Coatings segment during the three months ended March 31, 2023. |
| (e) | Represents incremental depreciation expense resulting from truncated useful lives of the assets impacted by our manufacturing footprint assessments and costs related to the closure of certain manufacturing sites, which we do not consider indicative of our ongoing operating performance. |
| (f) | Represents costs related to certain environmental remediation activities, which are not considered indicative of our ongoing operating performance. |
| (g) | Represents costs for certain non-operational or non-cash losses (gains), unrelated to our core business and which we do not consider indicative of our ongoing operating performance. |
| (h) | Represents the incremental step-up depreciation and amortization expense associated with the acquisition of DuPont Performance Coatings by Axalta. We believe this will assist investors in performing meaningful comparisons of past, present and future operating results and better highlight the results of our ongoing operating performance. |
FAQ
What was Axalta's (AXTA) net sales for Q3 2024?
How much did Axalta's (AXTA) net income increase in Q3 2024?
What was Axalta's (AXTA) Adjusted EBITDA margin in Q3 2024?
How many shares did Axalta (AXTA) repurchase in Q3 2024?
