Gentherm (THRM) Q4 2023 earnings summary

Executive summary

• Record FY 2023 product revenue of $1,469.1M and Adjusted EBITDA of $180.6M; automotive awards reached a record $2.6B.

• Execution, acquisition integration, cost control and proprietary technologies supported growth and future content opportunities.

Financial highlights

• Q4 product revenue was $366.9M, up 6.9% reported and 5.2% excluding FX; FY revenue was $1,469.1M, up 21.9% reported and 10.0% excluding FX and acquisitions.

• Q4 net income was $18.1M versus a $4.2M loss; FY net income was $40.3M versus $24.4M.

• Q4 adjusted diluted EPS was $0.90 versus $0.47; FY adjusted diluted EPS was $2.59 versus $1.82.

• FY operating cash flow was $119.3M; property and equipment purchases were $37.6M.

Outlook and guidance

• FY 2024 product revenue guidance is $1.5B–$1.6B, based on customer orders, low-single-digit declines in key-market light vehicle production and EUR/USD of $1.10.

• FY 2024 Adjusted EBITDA margin guidance is 12.5%–13.5%; effective tax rate is 26%–29%, and capital expenditures are $65M–$75M.

• 2026 outlook: product revenue of $1.9B–$2.0B and Adjusted EBITDA margin of 16%, following a pause in pursuing certain Battery Performance Solutions products.