Axalta Coating Systems (AXTA) investor relations material

Executive summary

• Achieved record adjusted EBITDA and adjusted diluted EPS in Q2 2025, with twelve consecutive quarters of YoY growth, despite challenging global markets and lower sales volumes.

• Net sales for Q2 2025 were $1.3B, down 3% year over year, mainly due to lower volumes in Performance Coatings, partially offset by acquisitions and currency gains.

• Mobility segment delivered 2% organic growth and a 500 bps YoY margin increase, driven by strength in China and Latin America, new business wins, and cost controls.

• Refinish volumes faced headwinds from lower claims and elevated distributor inventories, but market share gains continued with 1,600 net new body shops year to date.

• Operational excellence and cost discipline led to a 6% reduction in operating expenses and a 55% improvement in safety record year over year.

Financial highlights

• Adjusted EBITDA reached a quarterly record of $292M, margin expanded by 90 bps to 22.4%, and adjusted diluted EPS rose 5% to $0.64.

• Net income for Q2 2025 was $110M, down 3% YoY; operating cash flow increased 25% to $142M, and free cash flow was $101M.

• SG&A expenses declined 2%, and nearly 6% when excluding acquisitions and FX.

• Interest expense declined 10–14% YoY due to refinancing and lower principal.

• Gross margin improved by 100 bps to 35% due to lower input costs and productivity gains.

Outlook and guidance

• Q3 2025 net sales expected to be flat to low single digit growth YoY, with adjusted EBITDA projected between $290M and $300M.

• Full-year 2025 net sales expected at $5.2B–$5.275B, a 1% decline at midpoint versus prior year.

• Full-year adjusted EBITDA expected in the range of $1.14B–$1.165B; adjusted EPS $2.45–$2.55; free cash flow $475M–$500M.

• Adjusted EBITDA margins anticipated to remain at or above 22%, expanding 80–90 bps YoY.

• Management remains committed to transformation initiatives, with a new multi-year plan in early 2026.