On August 1, 2024, Axalta Coating Systems Ltd (AXTA, Financial) released its 8-K filing for the second quarter ended June 30, 2024. Axalta, a global leader in high-performance coatings systems, operates in two segments: Performance Coatings and Mobility Coatings, serving markets such as refinish, industrial, and original equipment manufacturers of light and commercial vehicles.
Q2 2024 Financial Highlights
Axalta reported a 4.4% year-over-year increase in net sales, reaching $1.35 billion, surpassing the analyst estimate of $1.34 billion. Net income rose by $52 million to $113 million, and adjusted EBITDA increased by $64 million to $291 million, with an adjusted EBITDA margin of 21.5%, up 400 basis points from the previous year. Diluted EPS saw an 89% increase to $0.51, exceeding the estimated $0.50 per share.
Segment Performance
The Performance Coatings segment reported net sales of $887 million, a 4% increase from the prior year. Refinish net sales grew by 5% to $546 million, driven by volume growth and new body shop wins. Industrial net sales increased by 2% to $341 million. The segment's adjusted EBITDA rose to $223 million, with a margin of 25.0%.
The Mobility Coatings segment achieved net sales of $464 million, a 6% year-over-year increase. Light Vehicle net sales improved by 7% to $354 million, with significant growth in China. Commercial Vehicle net sales increased by 3% to $110 million. The segment's adjusted EBITDA was $68 million, with a margin of 14.7%.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Net Sales | $1.35 billion | $1.29 billion |
| Net Income | $113 million | $61 million |
| Adjusted EBITDA | $291 million | $227 million |
| Diluted EPS | $0.51 | $0.27 |
Balance Sheet and Cash Flow
Axalta's cash and cash equivalents at the end of Q2 2024 were $840 million, with total liquidity exceeding $1.4 billion. The company repurchased $50 million of common shares and reported a net leverage ratio of 2.6x, down from 3.6x a year ago. Cash provided by operating activities was $114 million, compared to $131 million in the same period last year.
Management Commentary
"Axalta continues to execute exceptionally well," said Chris Villavarayan, CEO and President of Axalta. "I am proud of our global team's dedication and effort in achieving the highest quarterly net sales and Adjusted EBITDA in the company's history. As One Axalta, we remain committed to driving accelerated performance and unlocking the robust earnings potential of our business."
Outlook
Axalta has raised its full-year 2024 guidance, projecting adjusted EBITDA of $1.09-$1.10 billion and adjusted diluted EPS of approximately $2.05. The company also expects free cash flow to be in the range of $475-$500 million.
For more detailed information, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from Axalta Coating Systems Ltd for further details.
