Cooper-Standard (CPS) Q2 2024 earnings summary

Executive summary

• Achieved strong operational performance in Q2 2024, with 97% of customer scorecards green, margin improvement, and recognition for sustainability leadership.

• Awarded $61 million in net new business, with strong wins in hybrid and EV platforms.

• Safety performance remained excellent, with a total incident rate of 0.29 per 200,000 hours and 31 plants reporting zero incidents in H1.

• Aggressive lean and cost optimization initiatives implemented, targeting $20–$25 million in 2024 savings and $40–$45 million annualized in 2025.

• Net loss was $76.2 million in Q2, impacted by a $46.8 million non-cash pension settlement and $17.8 million in restructuring charges; adjusted net loss improved to $11.3 million.

Financial highlights

• Q2 2024 sales were $708.4 million, down 2.1% year-over-year, mainly due to divestitures and FX; gross profit improved to $82.9 million (11.7% margin).

• Adjusted EBITDA rose to $50.9 million (7.2% margin) from $47.9 million (6.6%) year-over-year.

• Free cash flow for Q2 was negative $23.3 million, an improvement from negative $30.7 million in Q2 2023.

• Liquidity at quarter-end was $266.5 million, including $93.8 million cash and $172.7 million ABL availability.

• Net loss for H1 2024 improved to $107.9 million from $158 million year-over-year.

Outlook and guidance

• FY 2024 sales guidance updated to $2.7–$2.8 billion, with adjusted EBITDA expected between $180–$200 million.

• Cost reduction initiatives expected to deliver $20–$25 million in 2024 and $40–$45 million annualized from 2025.

• Free cash flow outlook revised to break-even or slightly negative for 2024 due to cash interest payments.

• Both operating segments expected to approach or achieve double-digit EBITDA margins and ROIC by end of 2025.

• Management expects global light vehicle production in 2024 to be slightly lower than 2023, with modest growth in 2025 and 2026.