The following is a summary of the Gentherm Incorporated (THRM) Q1 2024 Earnings Call Transcript:
Financial Performance:
Gentherm reported a 2% decrease in product revenues in Q1 2024, with automotive revenues down by 2% to $345 million.
Adjusted EBITDA for the quarter was $44 million, up from $42 million in the previous year, due to supplier cost reductions, value engineering, and factory productivity.
The company achieved higher-than-expected growth in adjusted EBITDA margin, reaching 12.2% in Q1 2024 compared to 11.4% in Q1 2023.
Adjusted diluted earnings per share were up to $0.62 from $0.49 in the same quarter of the previous year.
Despite lower revenue, gross margin rate improved through measures like factory productivity, Fit-for-Growth savings and lower freight costs, partially offset by wage inflation and annual price reductions.
Business Progress:
Gentherm secured nearly $530 million of new business awards during the quarter despite a volatile automotive environment.
The company launched its automotive solutions on 27 vehicles across 13 OEMs including BMW, General Motors, Great Wall, Honda, Li Auto, Stellantis, Subaru and Volkswagen.
An extended advanced engineering lab and team were established in Hyderabad, India for software and technology development.
The company initiated a partnership with US Med-Equip to provide patient temperature management solutions to the U.S. healthcare market, adding 21 new hospital customers in China.
Gentherm's Fit-for-Growth initiative is on track to achieve $80 million of net savings between 2023 and 2026.
Its ClimateSense software was booked with GM, sparking interest from other customers worldwide, and secured a deal to provide high-end lumbar and massage equipment for GM's next-gen truck platforms.
An 80% win rate has been maintained for several quarters on thermal and pneumatic comfort solutions.
More details: Gentherm IR
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