Dauch (DCH) Q1 2025 earnings summary

Executive summary

• Q1 2025 sales were $1.41 billion, down from $1.61 billion year-over-year due to lower volumes and metal market pass-throughs.

• Net income for Q1 2025 was $7.1 million ($0.06 per share), compared to $20.5 million ($0.17 per share) in Q1 2024.

• Adjusted EBITDA for Q1 2025 was $177.3 million (12.6% margin), down from $205.6 million (12.8%) in Q1 2024.

• Operating cash flow improved to $55.9 million from $17.8 million year-over-year; adjusted free cash flow was $(3.9) million, up from $(21.4) million.

• Progress continues on the transformational Dowlais combination, with regulatory and financing milestones achieved and closing expected by year-end 2025.

Financial highlights

• Gross profit for Q1 2025 was $173.9 million (gross margin 12.3%), down from $198.5 million (12.4%) year-over-year.

• Operating income was $42.7 million, compared to $77.0 million year-over-year; operating margin fell to 3.0% from 4.8%.

• Interest expense decreased to $42.9 million from $49.0 million; interest income was $5.6 million, down from $8.3 million.

• Net debt at quarter-end was $2.07 billion, with a net leverage ratio of 2.9x; liquidity stood at ~$1.5 billion.

• SG&A (including R&D) was $90.9 million (6.4% of sales), down from $98.3 million (6.1%) year-over-year.

Outlook and guidance

• 2025 sales guidance updated to $5.65–$5.95 billion, with adjusted EBITDA of $665–$745 million and adjusted free cash flow of $165–$215 million.

• Guidance assumes North American light vehicle production of 14.0–15.1 million units and completion of the India axle business sale by July 1, 2025.

• CapEx expected at ~5% of sales; restructuring payments of $20–$30 million and acquisition-related costs of $60–$70 million anticipated for 2025.

• Guidance excludes Dowlais transaction impacts and is based on standalone operations.

• Full-year 2025 interest expense projected at $170–$180 million.