This press release is being issued pursuant to Rule 135c under the Securities Act, and it is neither an offer to sell nor a solicitation of an offer to buy any securities and shall not constitute an offer to sell or a solicitation of an offer to buy, or a sale of any securities in any jurisdiction in which such offer, solicitation or sale is unlawful. DENVER, May 22, 2024 /PRNewswire/ -- Gates Industrial Corporation plc (NYSE: GTES, "Gates") announced today that its indirect subsidiary, Gates Corporation (t ...

This press release is being issued pursuant to Rule 135c under the Securities Act, and it is neither an offer to sell nor a solicitation of an offer to buy any securities and shall not constitute an offer to sell or a solicitation of an offer to buy, or a sale of any securities in any jurisdiction in which such offer, solicitation or sale is unlawful. About Gates: Gates is a global manufacturer of innovative, highly engineered power transmission and fluid power solutions. Gates offers a broad portfolio of p ...

DENVER, May 15, 2024 /PRNewswire/ -- Gates Industrial Corporation plc (NYSE: GTES, "Gates" or the "Company") announced today that certain selling stockholders affiliated with Blackstone Inc. (the "Selling Stockholders") have commenced a secondary offering of 17,500,000 of Gates' ordinary shares (the "Offering"). In connection with the Offering, the Selling Stockholders intend to grant to the underwriters a 30-day option to purchase up to 2,625,000 additional ordinary shares. Gates is not offering any ordina ...

Q1 2024 EARNINGS PRESENTATION MAY 1, 2024 LEGAL DISCLAIMERS 2 This presentation contains, and management may make on our call today, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, you can identify these forward-looking statements by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "could," "seeks," "predicts," ...

Gates Industrial (GTES) came out with quarterly earnings of $0.31 per share, beating the Zacks Consensus Estimate of $0.30 per share. This compares to earnings of $0.25 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 3.33%. A quarter ago, it was expected that this manufacturer of power transmission and fluid power systems would post earnings of $0.29 per share when it actually produced earnings of $0.39, delivering a surprise ...

Financial Performance - First-quarter 2024 net sales were $862.6 million, a decrease of 3.9% from $897.7 million in the prior-year quarter, with a core sales decrease of 3.6%[4] - Net income attributable to shareholders for the first quarter was $40.0 million, or $0.15 per diluted share, compared to $26.4 million, or $0.09 per diluted share in the first quarter of 2023[5] - Adjusted EBITDA for the first quarter was $195.6 million, representing a margin of 22.7%, up from $174.5 million and 19.4% in the prior-year quarter[7] - Net income for the three months ended March 30, 2024, was $46.1 million, an increase of 50.8% compared to $30.6 million for the same period in 2023[28] - Adjusted EBITDA for the same period was $195.6 million, representing an Adjusted EBITDA margin of 22.7%, up from 19.4% in the prior year[36] - Adjusted Net Income attributable to shareholders increased to $83.5 million, compared to $72.8 million in the prior year[42] Segment Performance - Power Transmission segment net sales decreased by 2.8% to $532.8 million, with an Adjusted EBITDA of $119.0 million, reflecting a margin expansion of 270 basis points[9] - Fluid Power segment net sales decreased by 5.7% to $329.8 million, with an Adjusted EBITDA of $76.6 million, showing a margin improvement of 410 basis points[13] - The Power Transmission segment reported net sales of $532.8 million, down $9.4 million, while the Fluid Power segment saw a decrease of $22.9 million to $329.8 million[48] Guidance and Projections - The company has raised its full-year 2024 Adjusted EBITDA guidance to a range of $745 million to $805 million, an increase of $20 million from previous guidance[16] - Core revenue growth guidance for 2024 remains unchanged at a range of -3% to +1%[16] Cash Flow and Debt - The company reduced its gross debt during the quarter and had total outstanding debt of $2.4 billion as of March 30, 2024[14] - The company used $21.0 million of cash in operations during the first quarter, with capital expenditures increasing to $18.1 million from $14.6 million in the prior-year quarter[14] - Free Cash Flow for the period was negative at $(21.0) million, compared to positive cash flow of $52.5 million in the same period last year[28] - The company incurred $148.9 million in net cash used in financing activities during the period, primarily due to payments of long-term debt[28] Assets and Liabilities - Total assets decreased to $7,045.9 million as of March 30, 2024, down from $7,254.5 million as of December 30, 2023[26] - Cash and cash equivalents at the end of the period were $525.7 million, a decrease from $597.8 million at the end of the previous year[28] - Total liabilities decreased to $3,550.5 million as of March 30, 2024, down from $3,710.6 million as of December 30, 2023[26] Shareholder Actions - The company repurchased approximately $50 million of its ordinary shares in February 2024, with an additional $50 million available under its share repurchase authorization[15] - The diluted weighted-average number of shares outstanding was 267,435,531, compared to 287,878,415 in the prior year[42] Other Notable Events - The company recorded a pre-tax charge of $0.1 million related to a customer's bankruptcy proceedings during the three months ended March 30, 2024[45] - Cybersecurity incident expenses were incurred due to a malware attack on February 11, 2023, which may be partially offset by insurance recoveries[45] - Currency rate movements positively impacted net sales by $2.8 million overall, with a $5.9 million increase in Power Transmission and a $3.1 million decrease in Fluid Power[48] - The company reported a decrease in inventories to $677.2 million as of March 30, 2024, from $647.2 million as of December 30, 2023[26]

DENVER, April 10, 2024 /PRNewswire/ -- Gates Industrial Corporation plc (NYSE: GTES) will issue its first-quarter earnings release before the market opens on Wednesday, May 1, 2024. Management will host a webcast and conference call on the same day at 10:00 a.m. Eastern time to discuss Gates Industrial's financial results. The conference call can be accessed as follows: By dialing (888) 414-4601 (domestic) or +1 (646) 960-0313 (international) and requesting the Gates Industrial Corporation First-Quarter 20 ...

Financial Performance - The company reported revenue of $3.57 billion, a 1% year-over-year increase [7] - Adjusted EBITDA reached $747 million, representing a 10% year-over-year growth [7] - Gross margin improved to 38.1%, a 290 basis points increase [7] - Adjusted EPS expanded by 19% to $1.36 compared to 2022 [7] - Free cash flow conversion was 110%, a 55% increase [7] Q4 2023 Highlights - Q4 2023 net sales were $863.3 million [86] - Adjusted EBITDA margin for Q4 2023 was 21.5%, a 290 basis points year-over-year expansion [21] - Free cash flow conversion for Q4 2023 was 158% [21] - Net leverage ratio declined by 0.5x to 2.3x [7] Segment Performance - Power Transmission segment net sales for the year were $2.19 billion with an adjusted EBITDA margin of 21.0% [28] - Fluid Power segment net sales for the year were $1.38 billion with an adjusted EBITDA margin of 20.8% [31]

Financial Data and Key Metrics Changes - Fourth quarter total revenues were $863 million, down nearly 5% year-over-year on a core basis, primarily due to prior year's Q4 seasonality anomaly [9][10] - Adjusted EBITDA was $186 million, with an adjusted EBITDA margin of 21.5%, representing a year-over-year expansion of 290 basis points [10][30] - Free cash flow conversion was 110% for the year, with a net leverage ratio reduction of 0.5 turns year-over-year [7][15] Business Line Data and Key Metrics Changes - The Automotive segment saw mid-single-digit growth, while On-Highway revenues expanded over 40% year-over-year [14][34] - The Fluid Power segment generated revenues of $331 million, with core revenues falling about 5% year-over-year [35][36] - Industrial replacement revenues declined low single digits, while industrial first-fit experienced a more significant decline [12][34] Market Data and Key Metrics Changes - In China, Industrial First Fit core revenue grew double digits year-over-year, while global industrial replacement channel core revenues declined low single digits [33][77] - North America and EMEA experienced mid-single-digit declines, with automotive growth in EMEA countered by a significant decrease in industrial [36][118] - South America grew mid-single digits, benefiting from strength in automotive, energy, and on-highway markets [138] Company Strategy and Development Direction - The company is focused on executing organically driven enterprise initiatives to enhance performance and shareholder returns over a multiyear horizon [7][19] - Investments are being made in innovation, material science, and process engineering to improve competitive positioning [19][40] - The company anticipates a gradual improvement in demand trends in the second half of 2024, despite a pragmatic view of the first half [16][143] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about midterm growth prospects in the Personal Mobility market, despite current inventory challenges [11][44] - The company expects about half of its end markets to decline year-over-year in 2024, with a focus on managing through a challenging environment [16][43] - Management highlighted strong cash generation capabilities and a commitment to debt reduction while considering capital deployment options [88][106] Other Important Information - The company authorized a new stock repurchase plan of up to $100 million, emphasizing a focus on debt reduction and profitability improvement [140][88] - The upcoming Capital Markets Day is scheduled for March 11, where further details on enterprise initiatives will be shared [41][130] Q&A Session Summary Question: Why are half of the end markets expected to be down in 2024? - Management indicated that the decline is driven by normalization in demand after a strong run in previous years, particularly in On-Highway markets [22][23] Question: What is the expected EBITDA contribution from the first half of the year? - Management expects a more balanced split between the first and second halves of the year, with gradual improvement anticipated [26][70] Question: How does the company view the capital deployment plan for this year? - The focus remains on debt reduction and profitability improvement, with stock buybacks also being a consideration [88][106] Question: What is the outlook for the China market? - Management expressed optimism about the long-term prospects in China, noting a steady recovery in On-Highway and construction equipment [77][78] Question: How is the company approaching M&A opportunities? - The company has a strong pipeline of opportunities but is currently prioritizing debt reduction and share buybacks due to undervalued stock [124][125]

Financial Performance - For Fiscal 2023, net sales were $3,570.2 million, a slight increase of 0.5% compared to $3,554.2 million in Fiscal 2022, primarily driven by a $200.4 million benefit from pricing[206]. - Gross profit for Fiscal 2023 increased by 8.7% to $1,358.9 million, with a gross profit margin of 38.1%, up 290 basis points from the prior year[210]. - Adjusted EBITDA for Fiscal 2023 was $747.0 million, with an adjusted EBITDA margin of 20.9%[206]. - For Fiscal 2023, the company reported an Adjusted EBITDA of $747.0 million, a 9.8% increase from $680.6 million in the prior year, with an Adjusted EBITDA margin of 20.9%, up 180 basis points[228]. - Power Transmission net sales for Fiscal 2023 were $2,191.2 million, a 0.8% increase from $2,173.7 million in Fiscal 2022, driven by a $116.3 million benefit from pricing[229]. - Fluid Power net sales decreased by 0.1% to $1,379.0 million in Fiscal 2023, primarily due to lower volumes, although pricing provided an $84.1 million benefit[232]. - Adjusted EBITDA for the year ended December 30, 2023, was $747.0 million, up from $680.6 million in the previous year[265]. - Core revenue for Power Transmission increased by $36.4 million (1.7%), while Fluid Power decreased by $11.5 million (-0.8%) on a core basis[269]. Sales Channels - Sales into replacement channels accounted for approximately 64% of total net sales in Fiscal 2023, while first-fit sales accounted for about 36%[200][201]. - Automotive replacement sales increased by 6.1%, and automotive first-fit sales rose by 7.5% during Fiscal 2023, with significant growth in EMEA, Greater China, and South America[208]. Expenses and Costs - Cost of sales decreased by 4.0% to $2,211.3 million in Fiscal 2023, attributed to lower volumes and improved inbound freight costs[209]. - Selling, general and administrative expenses rose to $882.2 million in Fiscal 2023, an increase of $28.5 million primarily due to higher labor and benefits expenses[211]. - Interest expense increased by $24.4 million to $163.2 million in Fiscal 2023, mainly due to higher interest rates on Dollar Term Loans[217]. Cash Flow and Debt - The company experienced a cash flow from operating activities of $481.0 million in Fiscal 2023, compared to $265.8 million in the prior year, driven by improved trade working capital movement[239]. - Long-term debt as of December 30, 2023, was $2,451.5 million, slightly down from $2,463.0 million as of December 31, 2022[242]. - As of December 30, 2023, net debt decreased by $161.7 million to $1,751.3 million, driven by cash provided by operating activities of $481.0 million[252]. - Total cash and cash equivalents increased to $720.6 million as of December 30, 2023, compared to $578.4 million as of December 31, 2022[257]. - The principal amount of debt was $2,471.9 million as of December 30, 2023, compared to $2,491.4 million as of December 31, 2022[273]. Tax and Liquidity - The effective tax rate for Fiscal 2023 was 9.9%, up from 5.8% in Fiscal 2022, influenced by various tax benefits and expenses[221]. - The company does not anticipate any material long-term deterioration in its overall liquidity position in the foreseeable future[238]. - The company had a total committed borrowing headroom of $470.3 million as of December 30, 2023, in addition to cash balances[253]. Market Outlook and Risks - The company anticipates a potential rebound in demand later in 2024, despite expected inventory de-stocking and slower demand in the first half of the year[205]. - The company continues to monitor macroeconomic and geopolitical conditions that may impact operations, particularly in light of global conflicts and supply chain challenges[203][204]. - The company is exposed to foreign currency exchange risk, particularly with earnings and cash balances denominated in euros and other currencies when translated to U.S. dollars[305]. Share Repurchase and Valuation - The company paid $251.7 million for share repurchases in Fiscal 2023, an increase from $175.9 million in the prior year[241]. - No goodwill impairments were recognized during Fiscal 2023, as the fair values exceeded carrying values for both reporting units[288]. - The company recorded a pre-tax charge of $11.4 million related to a customer's Chapter 11 bankruptcy proceedings during Fiscal 2023[267]. Financial Instruments - The company executed a USD to Chinese Yuan fixed-to-fixed cross currency swap with a notional principal amount of ¥1,784.0 million during Fiscal 2023[306]. - The company uses interest rate derivatives to manage exposure to interest rate movements, with notional principal amounts of $870.0 million and $385.0 million maturing in June 2025 and November 2027, respectively[309].