Q2 2025 EARNINGS July 24, 2025 Forward-Looking Statements This presentation contains forward-looking statements within the meaning of U.S. federal securities laws. Forward-looking statements are statements other than historical fact that provide current expectations or forecasts of future events based on certain assumptions and are not guarantees of future performance. Forward-looking statements use words such as "anticipate," "believe," "continue," "could," "designed," "effect," "estimate," "evaluate," "ex ...

• On June 10, 2025, PHINIA entered into a definitive agreement to acquire Swedish Electromagnet Invest AB (SEM), a prominent provider of advanced natural gas, hydrogen and other alternative fuel ignition systems, injector stators and linear position sensors for approximately $47 million. The transaction is expected to close in the third quarter of 2025. • Net sales of $890 million, an increase of 2.5% compared with Q2 2024. ◦ Excluding the impacts of foreign currency and contract manufacturing agreements th ...

Core Viewpoint - Wall Street anticipates a year-over-year increase in earnings for Phinia (PHIN) despite lower revenues, with a focus on how actual results compare to estimates impacting stock price [1][2] Earnings Expectations - Phinia is expected to report quarterly earnings of $0.99 per share, reflecting a year-over-year increase of +12.5%, while revenues are projected to be $843.87 million, down 2.8% from the previous year [3] - The consensus EPS estimate has been revised 2.94% higher in the last 30 days, indicating a positive reassessment by analysts [4] Earnings Surprise Prediction - The Zacks Earnings ESP model indicates a positive Earnings ESP of +4.39% for Phinia, suggesting a likelihood of beating the consensus EPS estimate [11] - A positive Earnings ESP is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [9] Historical Performance - In the last reported quarter, Phinia was expected to post earnings of $1.04 per share but delivered only $0.94, resulting in a surprise of -9.62% [12] - Over the past four quarters, Phinia has only beaten consensus EPS estimates once [13] Conclusion - Phinia is viewed as a compelling candidate for an earnings beat, but investors should consider other factors beyond earnings results when making investment decisions [16]

Group 1 - The article highlights PHINIA Inc. as an attractive investment opportunity within the auto components industry, particularly due to its status as a relatively new spin-off [1] - The author emphasizes the integration of legal knowledge with financial insights, which provides a unique perspective on business dynamics [1] Group 2 - The article does not provide any specific financial data or performance metrics related to PHINIA Inc. or the auto components industry [2][3]

Summary of PHINIA (PHIN) Conference Call - June 11, 2025 Company Overview - **Company**: PHINIA (PHIN) - **Industry**: Global supplier of fuel systems and aftermarket components, spun out from Four Horner Key Points and Arguments Market Performance - **North America**: Light passenger vehicle revenue is less than 9% of total revenues, with aftermarket performing well and commercial vehicle business remaining steady [3][4][5] - **Europe**: Business performance is as expected, slightly better than anticipated [4] - **China**: Light passenger vehicle performance is stronger than expected, with growth in plug-in hybrids and range-extending EVs [4][39] OEM Relationships and Production Plans - OEMs are making minor adjustments to production plans rather than major shifts, indicating excess capacity in the market [14][15] - The company maintains a consistent order board, with aftermarket demand increasing due to aging vehicles [7][24] Tariffs and Cost Management - Tariff reimbursements are being finalized, with price increases implemented for the aftermarket in North America [8][12] - The company has a decentralized approach to cost management, holding plant managers accountable for adapting to market conditions [18][19] Financial Performance - Q1 EBITDA margin was 12.9%, with a full-year target of 14.5%. Adjusted EBITDA is expected to be around $470 million [27][28] - Historical EBITDA margins range from 13% to 15%, with expectations for stronger performance in Q2 and Q3 due to seasonal trends [28][29] Long-term Strategy and R&D - The company is committed to combustion technology, expecting it to remain relevant in transportation for the foreseeable future [46] - R&D spending is projected to remain around 3% of revenues, with significant customer funding for development projects [51][52] Market Trends and Future Outlook - The company anticipates continued growth in commercial vehicles and aftermarket segments, aiming for over 80% of revenues from these areas [71] - There is a shift in market sentiment towards a more balanced approach to electrification, with ongoing demand for combustion engines and alternative fuels [40][64] Capital Allocation and M&A Strategy - The company has been actively repurchasing shares, having bought back over 16.5% since spinning off [74] - Focus on acquisitions in the commercial vehicle and industrial sectors, avoiding consolidation in the light passenger vehicle market due to existing capacity [60][61] Regional Insights - The company has a balanced geographic exposure, with approximately 40% of revenues from the Americas and Europe, and 20% from Asia [78] - Competition in Asia is limited for high-end direct injection systems, providing a competitive advantage [92] Additional Important Insights - The company emphasizes long-term partnerships with OEMs, with a focus on stability and reliability in supply relationships [85][86] - There is a proactive approach to managing engineering costs and project allocations to ensure efficient use of resources [48][49] This summary encapsulates the key insights and strategic directions discussed during the conference call, highlighting the company's performance, market dynamics, and future growth opportunities.

Summary of Conference Call Company Overview - **Company**: Finia, a spinoff from BorgWarner, specializes in light vehicle fuel injection systems and has a strong presence in commercial and aftermarket businesses. [1][2] Key Industry Insights - **Market Growth**: The fuel injection market is experiencing content growth due to higher adoption of direct injection technologies. The company anticipates mid to high single-digit growth through the decade, particularly in natural gas and alternative fuels for commercial vehicles. [4][5] Financial Performance - **Cash Flow**: Finia targets over 90% free cash flow conversion, highlighting its strong cash flow generation capabilities. [2] M&A Strategy - **Acquisition Focus**: The company recently made a small acquisition aimed at enhancing its commercial vehicle and aftermarket exposure. The acquisition is expected to complement its existing product lines and leverage its engineering capabilities. [3][4][6] - **Valuation Metrics**: The acquisition was made at a multiple of 4.7, compared to Finia's own trading multiple of 5 to 5.5. [5] - **Future M&A Plans**: Finia is open to further acquisitions, particularly those that align with its existing portfolio and provide shareholder value. The company is cautious about pursuing aftermarket assets that do not have manufacturing capabilities. [7][10] Market Position - **Competitive Landscape**: Finia sees itself as one of the two major players in the light vehicle fuel injection market, alongside Bosch. Smaller competitors are exiting the market, which may provide opportunities for Finia to gain market share. [13][19][21] - **Revenue Goals**: The company aims to maintain its light passenger vehicle revenue between $900 million and $1 billion, while growing its aftermarket and commercial vehicle segments. [16] Sales and Revenue Guidance - **Q1 Performance**: The company reported Q1 revenue in line with expectations, despite a typical seasonal softness. The impact of foreign exchange (FX) was noted, with an estimated $80 million effect on revenue. [24][27] - **Commercial Vehicle Outlook**: The commercial vehicle segment is expected to remain flat to slightly up, with year-over-year declines anticipated in Europe and the Americas. [31][32] Tariff Exposure - **Impact of Tariffs**: Finia has experienced a $4 million impact from tariffs in Q1, with plans to pass through costs to customers. Approximately 60% of its revenue from Mexico is USMCA compliant, mitigating some tariff impacts. [36][39] Aftermarket Strategy - **Aftermarket Growth**: The company aims to increase its aftermarket revenue, currently at 34%, to over 40%. It has a billion-dollar aftermarket distribution network that supports this growth. [9][11] Technological Developments - **Powertrain ECU Development**: Finia is developing its own powertrain ECUs to provide a complete system offering to customers, with a focus on nonrecurring engineering support. [75][76] - **Aerospace and Defense Opportunities**: The company is entering the aerospace sector, supplying fuel injection components, with aspirations to grow this segment significantly by 2030. [78][79] Market Trends - **GDI Penetration**: Gasoline Direct Injection (GDI) penetration is currently around 65-70%, with expectations for continued growth in various global markets, including South America and India. [56][57] - **Battery Electric Vehicles (BEVs)**: The company anticipates that BEV penetration will plateau at around 25-35%, indicating a sustained demand for combustion engines. [60][64] Conclusion - **Long-term Vision**: Finia is focused on maintaining a balanced portfolio with a strong emphasis on aftermarket and commercial vehicle segments, while strategically navigating market challenges and opportunities for growth. [70][73]

Summary of PHINIA (PHIN) 2025 Conference Call Company Overview - **Company**: PHINIA (PHIN) - **Market Capitalization**: Approximately $2 billion - **Industry**: Automotive parts supplier, focusing on light vehicles, commercial vehicles, and aftermarket parts Key Points and Arguments Industry Performance - **Quarterly Performance**: The company remains comfortable with its full-year guidance despite some volatility in the North American market, which is a small percentage of its overall business [2][4] - **Regional Performance**: Europe, Asia, and South America are performing well, with strong aftermarket sales in North America [3][4] - **Aftermarket Strength**: There has been a slight increase in aftermarket strength in North America, attributed to organizational changes and new product introductions [7][10] Customer Dynamics - **Customer Production Schedules**: No significant changes in customer production schedules were noted, with consistent order boards across customers [5][14] - **Long-term Customer Conversations**: Ongoing discussions with customers about extending current programs and exploring new hybrid and plug-in hybrid programs that still require combustion engine components [17][21][31] Competitive Landscape - **Market Position**: The company has gained market share as competitors exit the market due to the capital-intensive nature of direct injection technology [35][39] - **Technology Gap**: Competitors may struggle to catch up due to a loss of engineering talent and expertise, creating a significant technology gap [46] Financial Outlook - **Tariff Impact**: The company experienced a $4 million tariff impact in Q1, with expectations for recovery through customer negotiations [48][50] - **EBITDA Guidance**: The company reiterated its EBITDA guidance, indicating a need for cost savings to achieve the projected run rate [59][62] - **Cash Management**: The company maintains a conservative cash reserve strategy, with a target of $200-$225 million in minimum cash [101] M&A and Capital Allocation - **Share Repurchase Program**: The company has repurchased approximately $100 million worth of stock and has $300 million remaining in its share repurchase program [104] - **M&A Strategy**: The company is selective in pursuing M&A opportunities, focusing on assets that align with its core competencies and long-term strategy [110][112] Future Trends - **Combustion Engine Longevity**: The company believes that combustion engines will remain relevant longer than previously expected, with continued demand in certain markets [33][78] - **USMCA Compliance**: The company is preparing for potential changes in USMCA compliance requirements, with a focus on maintaining flexibility in its manufacturing footprint [91][96] Additional Important Insights - **Technological Advancements**: The company is actively developing next-generation technologies for various fuel types, including ethanol and hydrogen, to meet evolving market demands [32][33] - **Flexibility in Manufacturing**: The company has demonstrated the ability to adapt its manufacturing capabilities to meet changing market needs, including converting production lines for different applications [118][119] This summary encapsulates the key insights and discussions from the PHINIA conference call, highlighting the company's performance, strategic direction, and market outlook.

Summary of PHINIA (PHIN) FY Conference Call - May 07, 2025 Company Overview - PHINIA is a diversified company with a revenue of approximately $3.4 billion as of 2024, operating across various product lines and markets [3][4] - The company serves multiple end markets: light commercial vehicles and medium-heavy duty commercial vehicles (39% of revenue), independent aftermarket and service business (34%), and light passenger vehicle OE business (27%) [3][4] Market Diversification - Regional diversification is significant, with Europe and America being roughly equal in scale, while Asia is smaller [4] - Customer diversification is also notable, with GM being the only customer exceeding 10% of revenue, and the top five customers accounting for only 40% of total revenue [5] Product Portfolio and Innovation - The product portfolio includes fuel products, starters, alternators, and canisters for commercial and industrial sectors, with a focus on carbon neutrality and alternative fuels [6][10] - The company generates nearly $100 million annually from nonrecurring engineering expenses paid by customers for integration support [7] Financial Performance and Capital Allocation - The company emphasizes financial discipline, maintaining a strong balance sheet, and liquidity to weather economic downturns [9][12] - Over the last four quarters, PHINIA repurchased over 16% of its outstanding shares and provided dividends, indicating a commitment to returning capital to shareholders [9][15] - The company aims for a revenue target of $5 billion by 2030, with organic growth expected to be in the 2-4% range [28][30] Tariffs and Market Dynamics - The North American business generates about $1 billion in manufacturing and revenues from Mexico, with a significant portion affected by tariffs [21][22] - The company has implemented price increases to pass through tariff costs to customers, with expectations of recovering costs through settlements [23][25] Growth Opportunities - PHINIA sees growth potential in alternative fuels, aerospace, and off-highway industrial applications, with a total addressable market of $56 billion [10][29] - The aftermarket segment is expected to grow at a rate of 3-6%, driven by the addition of new part numbers and market share gains [30] Joint Ventures and International Operations - The company has a non-consolidated joint venture in India with the TVS group, generating $2.25 billion in revenue, focusing on diesel products while PHINIA handles gasoline and alternative fuel applications [36][38] Brand Strength and Customer Relationships - The Delphi brand is recognized as a premium brand, which aids in customer confidence and sales, reducing reliance on white label products [31][32] Conclusion - PHINIA is positioned for stable long-term growth through diversification, disciplined capital allocation, and a focus on innovation in alternative fuels and aerospace applications, while navigating challenges such as tariffs and market cycles [8][10][12]

Core Insights - Investors in the Automotive - Original Equipment sector may consider Phinia (PHIN) and Modine (MOD) as potential investment opportunities [1] Valuation Metrics - Phinia has a Zacks Rank of 1 (Strong Buy), indicating a positive earnings outlook, while Modine has a Zacks Rank of 4 (Sell) [3] - The forward P/E ratio for PHIN is 9.75, significantly lower than MOD's forward P/E of 17.77, suggesting that PHIN may be undervalued [5] - PHIN's PEG ratio is 0.44, compared to MOD's PEG ratio of 0.52, indicating better expected earnings growth relative to its valuation [5] - PHIN has a P/B ratio of 1.06, while MOD's P/B ratio is 4.98, further supporting the notion that PHIN is undervalued [6] - Overall, PHIN has a Value grade of A, while MOD has a Value grade of C, highlighting PHIN as the superior value option [6]

Core Insights - Phinia (PHIN) reported a revenue of $796 million for the quarter ended March 2025, reflecting a decline of 7.8% year-over-year and a surprise of -2.94% against the Zacks Consensus Estimate of $820.13 million [1] - The earnings per share (EPS) for the quarter was $0.94, down from $1.08 in the same quarter last year, resulting in an EPS surprise of -9.62% compared to the consensus estimate of $1.04 [1] Financial Performance - The stock of Phinia has returned -0.6% over the past month, while the Zacks S&P 500 composite has seen a decline of -4.8% [3] - Phinia currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3] Geographic Revenue Breakdown - Revenue from the Americas was $356 million, exceeding the average estimate of $347.83 million [4] - Revenue from Europe was $317 million, falling short of the average estimate of $341.20 million [4] - Revenue from Asia was $123 million, below the average estimate of $137.25 million [4] Segment Performance - Aftermarket revenues were reported at $323 million, compared to the average estimate of $347.45 million [4] - Fuel Systems revenues were $473 million, which is lower than the average estimate of $501.34 million [4] - Segment Adjusted Operating Income (AOI) for Aftermarket was $52 million, compared to the average estimate of $55.52 million [4] - Segment AOI for Fuel Systems was $45 million, below the average estimate of $48.51 million [4]