Methode Electronics, Inc. Reports Fiscal 2024 Fourth Quarter and Full Year Financial Results
Methode Electronics announced its fiscal 2024 fourth quarter and full year financial results. Net sales for Q4 were $277.3 million, down from $301.2 million in Q4 fiscal 2023. Goodwill impairment led to a net loss of $57.3 million or $1.63 per diluted share. Adjusted net loss was $7.9 million or $0.23 per diluted share. Net cash provided by operations was $24.9 million, and free cash flow was $15.8 million. The company’s net debt stood at $169.4 million. For fiscal 2024, net sales were $1,114.5 million, with a net loss of $123.3 million or $3.48 per diluted share. Adjusted net loss was $15.0 million or $0.43 per diluted share. For fiscal 2025, the company expects flat sales and breakeven pre-tax income, with a return to growth in fiscal 2026. Jon DeGaynor will become CEO on July 15, 2024.
- Free cash flow improved to $15.8 million in Q4.
- Net debt reduced to $169.4 million in Q4.
- Over $140 million in new program awards in Q4.
- Net cash provided by operations was $24.9 million in Q4.
- Q4 net loss was $57.3 million due to goodwill impairment.
- Net sales for Q4 decreased by $23.9 million compared to Q4 fiscal 2023.
- Fiscal 2024 net loss was $123.3 million.
- Adjusted net loss for fiscal 2024 was $15.0 million.
- Automotive segment sales decreased by $40.3 million in Q4.
- Fiscal 2024 free cash flow was negative $2.7 million.
Insights
Methode Electronics' financial results for the fourth quarter and full fiscal year 2024 reveal a complex yet telling picture. The company reported net sales of
The goodwill impairment charge of
Despite these challenges, the company highlighted a few bright spots: it achieved the lowest net debt level of the fiscal year and noted a strong quarter for free cash flow and new program awards. The free cash flow was
Looking forward, Methode Electronics expects fiscal 2025 to be a year of repositioning, with flat organic sales growth and near-breakeven pre-tax income. The strategic focus remains on cost reduction, improving operational efficiencies and managing new program launches. The company’s guidance indicates a more optimistic outlook for fiscal 2026, with expectations for a return to organic sales growth and improved pre-tax income.
For retail investors, the company's financial results underscore the importance of understanding both the short-term challenges and long-term strategies. The goodwill impairment and operational inefficiencies are significant hurdles, but the focus on cost management and new program launches may yield positive results in the future. It’s important to monitor how effectively the company implements its strategic initiatives and manages its financial health in the coming quarters.
For Methode Electronics, the market dynamics of its key segments provide important context. The Automotive segment, which saw a notable decrease in sales, continues to grapple with lower volumes, driven by specific program roll-offs and market demand issues, particularly for electric and hybrid vehicles. This segment's performance is essential to the company's overall health, given that it constitutes more than half of the total sales.
Meanwhile, the Industrial segment showed some resilience with an increase in net sales, thanks largely to the acquisition of Nordic Lights. This acquisition has bolstered the segment’s performance even amid challenging market conditions for lighting products in the commercial vehicle market. The challenge going forward will be to integrate this acquisition successfully while navigating market fluctuations.
Another point of interest is the company's focus on new program awards, with over
From an investor's perspective, understanding the broader market trends impacting Methode’s segments—like the fluctuating demand in the automotive sector and the impact of acquisitions—will be critical. The company’s ability to adapt to these trends and execute its strategic initiatives will likely determine its financial trajectory moving forward.
- Positive Fourth Quarter Free Cash Flow
- Net Debt at Lowest Level of the Fiscal Year
- Over
$140 Million in Program Awards in Fourth Quarter - Fiscal 2025 Actions Expected to Reposition Company for Growth in Fiscal 2026
- Jon DeGaynor Appointed President, CEO and a Member of the Board of Directors
CHICAGO, July 11, 2024 (GLOBE NEWSWIRE) -- Methode Electronics, Inc. (NYSE: MEI), a leading global supplier of custom-engineered solutions for user interface, LED lighting and power distribution applications, today announced financial results for the fourth quarter and full year ended April 27, 2024.
Fiscal Fourth Quarter 2024 Highlights
- Net sales were
$277.3 million - Electric and hybrid vehicle applications were
14% of net sales - Goodwill impairment of
$49.4 million in North American Automotive reporting unit - Net loss was
$57.3 million , or$1.63 per diluted share - Adjusted net loss was
$7.9 million , or$0.23 per diluted share - Net cash provided by operating activities was
$24.9 million - Free cash flow was
$15.8 million - Total debt was
$330.9 million , net debt was$169.4 million - Company purchased 174,215 shares of its common stock for
$3.0 million
The company announced on June 25, 2024 that Jon DeGaynor was appointed President, Chief Executive Officer (CEO) and a member of the Board of Directors, effective July 15, 2024. Mr. DeGaynor will succeed Kevin Nystrom, a partner and managing director at AlixPartners LLP, who has served as interim CEO since May 7, 2024.
Management Comments
Interim Chief Executive Officer Kevin Nystrom said, “Sales rebounded from the third quarter but were down from the prior year due to auto program roll-offs and ongoing demand weakness in the e-bike market. EV activity was also down due to a program roll-off as well as lower market demand. The lower overall sales volume and ongoing operational inefficiencies in the Automotive segment, which are being driven by increased program launches, labor turnover, and higher costs, drove the adjusted net loss in the quarter. However, we had our best quarter of the year for free cash flow and new program awards, while also delivering our lowest net debt level of the four reporting periods.”
Mr. Nystrom added, “Our focus remains on long-term profitability improvement. We are undertaking initiatives to reduce costs, particularly in the areas of sourcing, logistics, and S&A, monetizing non-critical assets, managing our strong backlog of program launches, and improving low margin programs. We will also continue our efforts to reduce working capital, increase free cash flow, and reduce net debt. These actions are all foundational to our long-term plans and will carry on beyond the company’s leadership transition.”
Mr. Nystrom concluded, “As we take these actions to return Methode to profitability, we expect fiscal 2025 will be a year of repositioning with flat organic sales growth and approaching breakeven pre-tax income. We then expect a return to organic sales growth and a notable pre-tax income improvement in fiscal 2026.”
Consolidated Fiscal Fourth Quarter 2024 Financial Results
Methode's net sales were
Selling and administrative expense as a percentage of sales was
Loss from operations was
Net loss was
EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization of Intangibles), a non-GAAP financial measure, was negative
Debt was
Net cash provided by operating activities was
The company purchased and retired 174,215 shares of stock for
Segment Fiscal Fourth Quarter 2024 Financial Results
Comparing the Automotive segment’s quarter to the same quarter of fiscal 2023,
- Net sales were
$145.9 million , down from$186.2 million . Net sales decreased by$40.3 million or21.6% primarily due to lower volume in Asia and Europe. In Asia, the lower sales were mainly related to an EV program roll-off. In Europe, the lower sales were related to lower sensor volume resulting from an overstocked e-bike market. Also contributing to the decline was unfavorable foreign currency translation of$0.6 million . - Loss from operations was
$64.9 million , down from income from operations of$10.2 million . Loss from operations was a negative44.5% of net sales, down from a positive5.5% primarily due to the goodwill impairment of$49.4 million in the North American Automotive reporting unit. The loss was also driven by costs resulting from operational inefficiencies, mainly in North America. The operational inefficiencies that impacted the first three fiscal quarters of the year continued in the fourth fiscal quarter. Lower sales volume also contributed to the income decline.
Comparing the Industrial segment’s quarter to the same quarter of fiscal 2023,
- Net sales were
$117.2 million , up from$98.0 million . The acquisition of the Nordic Lights business contributed$21.8 million , partially offset by unfavorable foreign currency translation of$0.5 million . Net of the acquisition and foreign currency translation, net sales decreased by$2.1 million or2.1% driven primarily by lower demand for lighting products in the commercial vehicle market. - Income from operations was
$20.0 million , down from$23.4 million . The acquisition of the Nordic Lights business contributed$1.8 million . Income from operations was17.1% of net sales, down from23.9% mainly due to product sales mix.
Comparing the Interface segment’s quarter to the same quarter of fiscal 2023,
- Net sales were
$14.2 million , down from$15.8 million . The decrease was mainly due to lower volume of appliance products. - Income from operations was
$1.5 million , up from$1.3 million . Income from operations was10.6% of net sales, up from8.2% . Both increases were mainly due to product sales mix.
Fiscal 2024
Methode's net sales were
Net loss was
EBITDA, a non-GAAP financial measure, was a negative
Net cash provided by operating activities was
Guidance
For fiscal 2025, the company expects net sales to be similar to fiscal 2024 and adjusted pre-tax income to be approaching breakeven. The adjusted pre-tax income for the second half of fiscal 2025 is expected to be significantly stronger than the first half, with the first quarter of fiscal 2025 being similarly negative as the fourth quarter of fiscal 2024. For fiscal 2026, the company expects net sales to be greater than fiscal 2025 and pre-tax income to be positive and notably greater than fiscal 2025.
The guidance is subject to change due to a variety of factors including the successful launch of multiple new programs, the ultimate take rates on new EV programs, success and timing of cost recovery actions, inflation, global economic instability, supply chain disruptions, potential restructuring efforts, potential impairments and any acquisitions or divestitures.
Conference Call
The company will conduct a conference call and webcast to review financial and operational highlights led by its Interim Chief Executive Officer, Kevin Nystrom, and Chief Financial Officer, Ronald L. G. Tsoumas, today at 10:00 a.m. CDT.
To participate in the conference call, please dial 888-506-0062 (domestic) or 973-528-0011 (international) at least five minutes prior to the start of the event. A simultaneous webcast can be accessed through the company’s website, www.methode.com, on the Investors page.
A replay of the teleconference will be available shortly after the call through July 25, 2024, by dialing 877-481-4010 and providing passcode 50699. A webcast replay will also be available on the company’s website, www.methode.com, on the Investors page.
About Methode Electronics, Inc.
Methode Electronics, Inc. (NYSE: MEI) is a leading global supplier of custom-engineered solutions with sales, engineering and manufacturing locations in North America, Europe, Middle East and Asia. We design, engineer, and produce mechatronic products for OEMs utilizing our broad range of technologies for user interface, LED lighting system, power distribution and sensor applications.
Our solutions are found in the end markets of transportation (including automotive, commercial vehicle, e-bike, aerospace, bus, and rail), cloud computing infrastructure, construction equipment, and consumer appliance. Our business is managed on a segment basis, with those segments being Automotive, Industrial, and Interface.
Non-GAAP Financial Measures
To supplement the company's financial statements presented in accordance with generally accepted accounting principles in the United States (“GAAP”), Methode uses Adjusted Net Income (Loss), Adjusted Earnings (Loss) Per Share, Adjusted Pre-Tax Income (Loss), Adjusted Income (Loss) from Operations, EBITDA, Adjusted EBITDA, Net Debt and Free Cash Flow as non-GAAP measures. Reconciliation to the nearest GAAP measures of all non-GAAP measures included in this press release can be found at the end of this release. Methode's definitions of these non-GAAP measures may differ from similarly titled measures used by others. These non-GAAP measures should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP. The company believes that these non-GAAP measures are useful because they (i) provide both management and investors meaningful supplemental information regarding financial performance by excluding certain expenses and benefits that may not be indicative of recurring core business operating results, (ii) permit investors to view Methode's performance using the same tools that management uses to evaluate its past performance, reportable business segments and prospects for future performance (iii) are commonly used by other companies in our industry and provide a comparison for investors to the company’s performance versus its competitors and (iv) otherwise provide supplemental information that may be useful to investors in evaluating Methode.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect, when made, our current views with respect to current events and financial performance. Such forward-looking statements are subject to many risks, uncertainties and factors relating to our operations and business environment, which may cause our actual results to be materially different from any future results, expressed or implied, by such forward-looking statements. All statements that address future operating, financial or business performance or our strategies or expectations are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “potential,” “outlook” or “continue,” and other comparable terminology. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the following:
- Dependence on the automotive, commercial vehicle, and construction industries;
- Timing, quality and cost of new program launches;
- Changes in electric vehicle (“EV”) demand;
- Investment in programs prior to the recognition of revenue;
- Failure to attract and retain qualified personnel;
- Impact from production delays or cancelled orders;
- Impact from inflation;
- Dependence on the availability and price of materials;
- Dependence on a small number of large customers, including one large automotive customer;
- Dependence on our supply chain;
- Risks related to conducting global operations;
- Effects of potential catastrophic events or other business interruptions;
- Ability to withstand pricing pressures, including price reductions;
- Ability to compete effectively;
- Our lengthy sales cycle;
- Risks relating to our use of requirements contracts;
- Potential work stoppages;
- Ability to successfully benefit from acquisitions and divestitures;
- Ability to manage our debt levels and comply with restrictions and covenants under our credit agreement;
- Interest rate changes and variable rate instruments;
- Timing and magnitude of costs associated with restructuring activities;
- Recognition of goodwill and other intangible asset impairment charges;
- Ability to remediate a material weakness in our internal control over financial reporting;
- Currency fluctuations;
- Income tax rate fluctuations;
- Judgments related to accounting for tax positions;
- Ability to withstand business interruptions;
- Potential IT security threats or breaches;
- Ability to protect our intellectual property;
- Costs associated with environmental, health and safety regulations;
- International trade disputes resulting in tariffs and our ability to mitigate tariffs;
- Impact from climate change and related regulations; and
- Ability to avoid design or manufacturing defects.
Additional details and factors are discussed under the caption “Risk Factors” in our periodic reports filed with the Securities and Exchange Commission. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. Any forward-looking statements made by us speak only as of the date on which they are made. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, subsequent events or otherwise.
For Methode Electronics, Inc.
Robert K. Cherry
Vice President, Investor Relations
rcherry@methode.com
+1-708-457-4030
| METHODE ELECTRONICS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in millions, except per-share data) | ||||||||||||||||
| Three Months Ended | Fiscal Year Ended | |||||||||||||||
| April 27, 2024 | April 29, 2023 | April 27, 2024 | April 29, 2023 | |||||||||||||
| Net sales | $ | 277.3 | $ | 301.2 | $ | 1,114.5 | $ | 1,179.6 | ||||||||
| Cost of products sold | 241.8 | 237.9 | 935.7 | 915.5 | ||||||||||||
| Gross profit | 35.5 | 63.3 | 178.8 | 264.1 | ||||||||||||
| Selling and administrative expenses | 41.6 | 50.1 | 160.9 | 154.9 | ||||||||||||
| Goodwill impairment | 49.4 | — | 105.9 | — | ||||||||||||
| Amortization of intangibles | 6.0 | 4.7 | 24.0 | 18.8 | ||||||||||||
| (Loss) income from operations | (61.5 | ) | 8.5 | (112.0 | ) | 90.4 | ||||||||||
| Interest expense, net | 4.5 | 1.4 | 16.7 | 2.7 | ||||||||||||
| Other income, net | (2.9 | ) | (0.7 | ) | (0.6 | ) | (2.4 | ) | ||||||||
| Pre-tax (loss) income | (63.1 | ) | 7.8 | (128.1 | ) | 90.1 | ||||||||||
| Income tax (benefit) expense | (5.8 | ) | (0.3 | ) | (4.8 | ) | 13.0 | |||||||||
| Net (loss) income | (57.3 | ) | 8.1 | (123.3 | ) | 77.1 | ||||||||||
| Net income attributable to redeemable noncontrolling interest | — | — | — | — | ||||||||||||
| Net (loss) income attributable to Methode | $ | (57.3 | ) | $ | 8.1 | $ | (123.3 | ) | $ | 77.1 | ||||||
| (Loss) income per share attributable to Methode: | ||||||||||||||||
| Basic | $ | (1.63 | ) | $ | 0.23 | $ | (3.48 | ) | $ | 2.14 | ||||||
| Diluted | $ | (1.63 | ) | $ | 0.22 | $ | (3.48 | ) | $ | 2.10 | ||||||
| Cash dividends per share | $ | 0.14 | $ | 0.14 | $ | 0.56 | $ | 0.56 | ||||||||
| METHODE ELECTRONICS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in millions, except share and per-share data) | ||||||||
| April 27, 2024 | April 29, 2023 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 161.5 | $ | 157.0 | ||||
| Accounts receivable, net | 262.6 | 314.3 | ||||||
| Inventories | 186.2 | 159.7 | ||||||
| Income tax receivable | 4.0 | 12.9 | ||||||
| Prepaid expenses and other current assets | 18.7 | 20.5 | ||||||
| Assets held for sale | 4.7 | — | ||||||
| Total current assets | 637.7 | 664.4 | ||||||
| Long-term assets: | ||||||||
| Property, plant and equipment, net | 212.1 | 220.3 | ||||||
| Goodwill | 169.9 | 301.9 | ||||||
| Other intangible assets, net | 256.7 | 256.7 | ||||||
| Operating lease right-of-use assets, net | 26.7 | 28.4 | ||||||
| Deferred tax assets | 34.7 | 33.6 | ||||||
| Pre-production costs | 44.1 | 36.1 | ||||||
| Other long-term assets | 21.6 | 37.7 | ||||||
| Total long-term assets | 765.8 | 914.7 | ||||||
| Total assets | $ | 1,403.5 | $ | 1,579.1 | ||||
| LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND SHAREHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 132.4 | $ | 138.7 | ||||
| Accrued employee liabilities | 38.0 | 36.7 | ||||||
| Other accrued liabilities | 46.0 | 34.5 | ||||||
| Short-term operating lease liabilities | 6.7 | 6.8 | ||||||
| Short-term debt | 0.2 | 3.2 | ||||||
| Income tax payable | 8.1 | 8.1 | ||||||
| Total current liabilities | 231.4 | 228.0 | ||||||
| Long-term liabilities: | ||||||||
| Long-term debt | 330.7 | 303.6 | ||||||
| Long-term operating lease liabilities | 20.6 | 21.8 | ||||||
| Long-term income tax payable | 9.3 | 16.7 | ||||||
| Other long-term liabilities | 16.8 | 14.3 | ||||||
| Deferred tax liabilities | 28.7 | 41.8 | ||||||
| Total long-term liabilities | 406.1 | 398.2 | ||||||
| Total liabilities | 637.5 | 626.2 | ||||||
| Redeemable noncontrolling interest | — | 11.1 | ||||||
| Shareholders' equity: | ||||||||
| Common stock, | 18.3 | 18.6 | ||||||
| Additional paid-in capital | 183.6 | 181.0 | ||||||
| Accumulated other comprehensive loss | (36.7 | ) | (19.0 | ) | ||||
| Treasury stock, 1,346,624 shares as of April 27, 2024 and April 29, 2023 | (11.5 | ) | (11.5 | ) | ||||
| Retained earnings | 612.3 | 772.7 | ||||||
| Total shareholders' equity | 766.0 | 941.8 | ||||||
| Total liabilities, redeemable noncontrolling interest and shareholders' equity | $ | 1,403.5 | $ | 1,579.1 | ||||
| METHODE ELECTRONICS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) | ||||||||
| Fiscal Year Ended | ||||||||
| April 27, 2024 | April 29, 2023 | |||||||
| Operating activities: | ||||||||
| Net (loss) income | $ | (123.3 | ) | $ | 77.1 | |||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 57.9 | 49.5 | ||||||
| Stock-based compensation expense | 3.6 | 11.5 | ||||||
| Change in cash surrender value of life insurance | (1.2 | ) | 0.3 | |||||
| Amortization of debt issuance costs | 0.8 | 0.7 | ||||||
| (Gain) loss on sale of assets | (1.9 | ) | 0.6 | |||||
| Impairment of long-lived assets | 2.3 | 0.7 | ||||||
| Goodwill impairment | 105.9 | — | ||||||
| Change in deferred income taxes | (20.8 | ) | (4.6 | ) | ||||
| Other | 0.4 | 0.5 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 48.0 | (21.0 | ) | |||||
| Inventories | (30.7 | ) | 8.9 | |||||
| Prepaid expenses and other assets | 6.9 | (25.4 | ) | |||||
| Accounts payable | (4.7 | ) | 19.8 | |||||
| Other liabilities | 4.3 | 14.2 | ||||||
| Net cash provided by operating activities | 47.5 | 132.8 | ||||||
| Investing activities: | ||||||||
| Purchases of property, plant and equipment | (50.2 | ) | (42.0 | ) | ||||
| Proceeds from redemption of life insurance | 10.8 | — | ||||||
| Proceeds from settlement of net investment hedge | 0.6 | — | ||||||
| Proceeds from disposition of assets | 21.3 | 3.5 | ||||||
| Acquisition of business, net of cash acquired | — | (114.6 | ) | |||||
| Net cash used in investing activities | (17.5 | ) | (153.1 | ) | ||||
| Financing activities: | ||||||||
| Taxes paid related to net share settlement of equity awards | (3.8 | ) | (0.5 | ) | ||||
| Repayments of finance leases | (0.2 | ) | (0.4 | ) | ||||
| Debt issuance costs | (1.1 | ) | (3.2 | ) | ||||
| Proceeds from exercise of stock options | — | 1.5 | ||||||
| Purchases of common stock | (13.7 | ) | (48.1 | ) | ||||
| Cash dividends | (19.9 | ) | (19.8 | ) | ||||
| Purchase of redeemable noncontrolling interest | (10.9 | ) | — | |||||
| Proceeds from borrowings | 237.9 | 344.7 | ||||||
| Repayments of borrowings | (207.2 | ) | (271.0 | ) | ||||
| Net cash (used in) provided by financing activities | (18.9 | ) | 3.2 | |||||
| Effect of foreign currency exchange rate changes on cash and cash equivalents | (6.6 | ) | 2.1 | |||||
| Increase (decrease) in cash and cash equivalents | 4.5 | (15.0 | ) | |||||
| Cash and cash equivalents at beginning of the period | 157.0 | 172.0 | ||||||
| Cash and cash equivalents at end of the period | $ | 161.5 | $ | 157.0 | ||||
| Supplemental cash flow information: | ||||||||
| Cash paid during the period for: | ||||||||
| Interest | $ | 17.0 | $ | 5.6 | ||||
| Income taxes, net of refunds | $ | 15.0 | $ | 25.6 | ||||
| Operating lease obligations | $ | 9.6 | $ | 8.8 | ||||
| METHODE ELECTRONICS, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP MEASURES (Unaudited) (in millions) | ||||||||||||||||
| Three Months Ended | Fiscal Year Ended | |||||||||||||||
| April 27, 2024 | April 29, 2023 | April 27, 2024 | April 29, 2023 | |||||||||||||
| EBITDA: | ||||||||||||||||
| Net (loss) income | $ | (57.3 | ) | $ | 8.1 | $ | (123.3 | ) | $ | 77.1 | ||||||
| Income tax (benefit) expense | (5.8 | ) | (0.3 | ) | (4.8 | ) | 13.0 | |||||||||
| Interest expense, net | 4.5 | 1.4 | 16.7 | 2.7 | ||||||||||||
| Amortization of intangibles | 6.0 | 4.7 | 24.0 | 18.8 | ||||||||||||
| Depreciation | 8.6 | 8.0 | 33.9 | 30.7 | ||||||||||||
| EBITDA | (44.0 | ) | 21.9 | (53.5 | ) | 142.3 | ||||||||||
| Goodwill impairment | 49.4 | — | 105.9 | — | ||||||||||||
| Acquisition costs | — | 6.8 | 0.5 | 6.8 | ||||||||||||
| Acquisition-related costs - purchase accounting adjustments related to inventory | — | — | 0.5 | — | ||||||||||||
| Restructuring and impairment charges | 2.3 | 0.4 | 3.7 | 1.0 | ||||||||||||
| Costs related to the reorganization of a foreign subsidiary | — | 2.6 | — | 2.6 | ||||||||||||
| Net gain on sale of non-core assets | (2.4 | ) | — | (1.8 | ) | — | ||||||||||
| Adjusted EBITDA | $ | 5.3 | $ | 31.7 | $ | 55.3 | $ | 152.7 | ||||||||
| Three Months Ended | Fiscal Year Ended | |||||||||||||||
| April 27, 2024 | April 29, 2023 | April 27, 2024 | April 29, 2023 | |||||||||||||
| Free Cash Flow: | ||||||||||||||||
| Net cash provided by operating activities | $ | 24.9 | $ | 49.0 | $ | 47.5 | $ | 132.8 | ||||||||
| Purchases of property, plant and equipment | (9.1 | ) | (11.2 | ) | (50.2 | ) | (42.0 | ) | ||||||||
| Free cash flow | $ | 15.8 | $ | 37.8 | $ | (2.7 | ) | $ | 90.8 | |||||||
| April 27, 2024 | April 29, 2023 | |||||||
| Net Debt: | ||||||||
| Short-term debt | $ | 0.2 | $ | 3.2 | ||||
| Long-term debt | 330.7 | 303.6 | ||||||
| Total debt | 330.9 | 306.8 | ||||||
| Less: cash and cash equivalents | (161.5 | ) | (157.0 | ) | ||||
| Net debt | $ | 169.4 | $ | 149.8 | ||||
| METHODE ELECTRONICS, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP MEASURES (Unaudited) (in millions, except per share data) | ||||||||||||||||||||||||||||||||
| Reconciliation of Non-GAAP Financial Measures for the Three Months Ended April 27, 2024 | ||||||||||||||||||||||||||||||||
| U.S. GAAP (as reported) | Goodwill impairment | Acquisition costs | Purchase accounting adjustments related to inventory | Restructuring costs | Net gain on sale of non-core assets | Taxes and costs related to the reorganization of a foreign subsidiary | Non-U.S. GAAP (adjusted) | |||||||||||||||||||||||||
| (Loss) income from operations | $ | (61.5 | ) | $ | 49.4 | $ | — | $ | — | $ | 2.3 | $ | — | $ | — | $ | (9.8 | ) | ||||||||||||||
| Pre-tax (loss) income | $ | (63.1 | ) | $ | 49.4 | $ | — | $ | — | $ | 2.3 | $ | (2.4 | ) | $ | — | $ | (13.8 | ) | |||||||||||||
| Net (loss) income | $ | (57.3 | ) | $ | 49.4 | $ | — | $ | — | $ | 1.9 | $ | (1.9 | ) | $ | — | $ | (7.9 | ) | |||||||||||||
| Diluted (loss) income per share | $ | (1.63 | ) | $ | 1.40 | $ | — | $ | — | $ | 0.05 | $ | (0.05 | ) | $ | — | $ | (0.23 | ) | |||||||||||||
| Reconciliation of Non-GAAP Financial Measures for the Three Months Ended April 29, 2023 | ||||||||||||||||||||||||||||||||
| U.S. GAAP (as reported) | Goodwill impairment | Acquisition costs | Purchase accounting adjustments related to inventory | Restructuring costs | Loss on sale of Dabir assets | Taxes and costs related to the reorganization of a foreign subsidiary | Non-U.S. GAAP (adjusted) | |||||||||||||||||||||||||
| Income from operations | $ | 8.5 | $ | — | $ | 6.8 | $ | — | $ | 0.4 | $ | — | $ | 0.5 | $ | 16.2 | ||||||||||||||||
| Pre-tax income | $ | 7.8 | $ | — | $ | 6.8 | $ | — | $ | 0.4 | $ | — | $ | 0.5 | $ | 15.5 | ||||||||||||||||
| Net income | $ | 8.1 | $ | — | $ | 6.6 | $ | — | $ | 0.3 | $ | — | $ | (7.0 | ) | $ | 8.0 | |||||||||||||||
| Diluted income per share | $ | 0.22 | $ | — | $ | 0.18 | $ | — | $ | 0.01 | $ | — | $ | (0.19 | ) | $ | 0.22 | |||||||||||||||
| Reconciliation of Non-GAAP Financial Measures for the Fiscal Year Ended April 27, 2024 | ||||||||||||||||||||||||||||||||
| U.S. GAAP (as reported) | Goodwill impairment | Acquisition costs | Purchase accounting adjustments related to inventory | Restructuring costs | Net gain on sale of non-core assets | Taxes and costs related to the reorganization of a foreign subsidiary | Non-U.S. GAAP (adjusted) | |||||||||||||||||||||||||
| (Loss) income from operations | $ | (112.0 | ) | $ | 105.9 | $ | 0.5 | $ | 0.5 | $ | 3.7 | $ | — | $ | — | $ | (1.4 | ) | ||||||||||||||
| Pre-tax (loss) income | $ | (128.1 | ) | $ | 105.9 | $ | 0.5 | $ | 0.5 | $ | 3.7 | $ | (1.8 | ) | $ | — | $ | (19.3 | ) | |||||||||||||
| Net (loss) income | $ | (123.3 | ) | $ | 105.9 | $ | 0.4 | $ | 0.4 | $ | 3.0 | $ | (1.4 | ) | $ | — | $ | (15.0 | ) | |||||||||||||
| Diluted (loss) income per share | $ | (3.48 | ) | $ | 2.99 | $ | 0.01 | $ | 0.01 | $ | 0.08 | $ | (0.04 | ) | $ | — | $ | (0.43 | ) | |||||||||||||
| Reconciliation of Non-GAAP Financial Measures for the Fiscal Year Ended April 29, 2023 | ||||||||||||||||||||||||||||||||
| U.S. GAAP (as reported) | Goodwill impairment | Acquisition costs | Purchase accounting adjustments related to inventory | Restructuring costs | Loss on sale of Dabir assets | Taxes and costs related to the reorganization of a foreign subsidiary | Non-U.S. GAAP (adjusted) | |||||||||||||||||||||||||
| Income from operations | $ | 90.4 | $ | — | $ | 6.8 | $ | — | $ | 0.6 | $ | — | $ | 0.5 | $ | 98.3 | ||||||||||||||||
| Pre-tax income | $ | 90.1 | $ | — | $ | 6.8 | $ | — | $ | 0.6 | $ | — | $ | 0.5 | $ | 98.0 | ||||||||||||||||
| Net income | $ | 77.1 | $ | — | $ | 6.6 | $ | — | $ | 0.5 | $ | — | $ | (7.0 | ) | $ | 77.2 | |||||||||||||||
| Diluted income per share | $ | 2.10 | $ | — | $ | 0.18 | $ | — | $ | 0.01 | $ | — | $ | (0.19 | ) | $ | 2.10 | |||||||||||||||
FAQ
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