Exco (XTC) investor relations material

Executive summary

• Q3 2025 revenue declined 4% year-over-year to $154.9M, driven by lower automotive production, customer delays, and macroeconomic uncertainty.

• Profitability was pressured by lower volumes, unfavorable mix, FX losses, and restructuring costs, but cost controls and automation helped maintain segment margins.

• Free cash flow increased to $20.1M, and net debt was reduced to $71.5M, with net leverage at 1x.

• Management highlighted resilience and strategic positioning for future growth amid ongoing trade and market uncertainties.

• Strategic investments in automation, new equipment, and plant expansions are beginning to yield operational benefits.

Financial highlights

• Consolidated Q3 2025 sales were $154.9M, down from $161.8M year-over-year; FX increased sales by $3.1M.

• Net income was $5.4M ($0.14/share), down 34% from $8.2M ($0.21/share) last year; included $0.6M after-tax restructuring charges.

• EBITDA for Q3 2025 was $14.7M, down from $22.3M year-over-year; margin declined to 9.5% from 13.8%.

• Operating cash flow was $25.2M; free cash flow $20.1M after $3.9M in maintenance capex.

• Ended quarter with $23.5M in cash, $95M in long-term debt, and $56.6M available under credit facility.

Outlook and guidance

• Fiscal 2026 revenue, EBITDA, and EPS targets withdrawn due to global trade policy uncertainty, especially tariffs.

• Cautious but optimistic outlook; new trade agreements and USMCA compliance reduce tariff risk and support North American market share.

• Strategic initiatives, greenfield investments, and new program launches expected to drive long-term growth and margin expansion.

• Reshoring trends and anticipated tariffs on non-USMCA suppliers may provide competitive advantage.

• Long-term demand drivers include aging vehicle fleets, potential interest rate easing, and increased OEM incentives.