Knowles(KN) - 2024 Q3 - Quarterly Results

Financial Performance - Revenues from continuing operations for Q3 2024 increased by 32% year-over-year to $143 million, at the high end of the guided range[1] - Net cash provided by operating activities reached$53 million, exceeding the high end of the guided range[1] - Non-GAAP diluted EPS from continuing operations was $0.26, at the midpoint of the guided range[2] - The Cornell acquisition contributed to the revenue growth, alongside an organic growth of 4$62.9 million, representing 44.1% of revenues, compared to 46.6% in Q3 2023[3] - Operating earnings for Q3 2024 were $18.7 million, an increase from$11.4 million in Q3 2023[12] - Revenues for the nine months ended September 30, 2024, increased to $411.0 million, up 29.4$317.6 million in the same period of 2023[14] - Gross profit for the nine months ended September 30, 2024, was $173.9 million, representing a gross margin of 42.3$145.2 million and 45.7% in the prior year[14][16] - Operating earnings for the nine months ended September 30, 2024, were $36.4 million, an increase of 13.4$32.1 million in the same period of 2023[14] - Net loss for the nine months ended September 30, 2024, was $(256.3) million, compared to net earnings of$25.0 million in the same period of 2023[14] - Basic earnings per share from continuing operations decreased to $0.15 for the nine months ended September 30, 2024, down from$0.43 in the prior year[14] - Net earnings from continuing operations for the quarter ended September 30, 2024, were $9.2 million, compared to$4.8 million for the same period last year, representing a 92% increase[17] - Non-GAAP net earnings for the quarter were $24.2 million, up from$18.4 million year-over-year, reflecting a 31% growth[17] - Diluted earnings per share from continuing operations increased to $0.10, compared to$0.05 in the prior year, marking a 100% rise[17] Expenses and Liabilities - Research and development expenses for Q3 2024 were $10.2 million, up from$8.1 million in Q3 2023[12] - Selling and administrative expenses rose to $106.8 million for the nine months ended September 30, 2024, up from$87.3 million in the prior year[14] - Interest expense, net, significantly increased to $12.9 million for the nine months ended September 30, 2024, compared to$2.2 million in the same period of 2023[14] - Research and development expenses increased to $29.2 million for the nine months ended September 30, 2024, compared to$24.0 million in the same period of 2023[14] Cash Flow and Capital Expenditures - Net cash provided by operating activities increased to $95.0 million for the nine months ended September 30, 2024, up from$62.3 million in the same period of 2023[20] - Adjusted free cash flow for the nine months ended September 30, 2024, was $63.5 million, compared to$32.7 million for the same period in 2023[22] - Non-GAAP net cash attributable to continuing operations was $72.9 million for the nine months ended September 30, 2024, compared to$40.7 million in the same period of 2023[22] - Capital expenditures for the nine months ended September 30, 2024, were $10.3 million, slightly down from$11.8 million in the same period of 2023[22] - The company made payments of $130.0 million under its revolving credit facility during the nine months ended September 30, 2024[20] - The company reported a net cash used in financing activities of$87.2 million for the nine months ended September 30, 2024, compared to $35.3 million in the same period of 2023[20] - The company experienced a net increase in cash and cash equivalents of$5.3 million for the nine months ended September 30, 2024, compared to an increase of $26.9 million in the same period of 2023[20] Balance Sheet - Total current assets as of September 30, 2024, amounted to$436.0 million, an increase from $428.8 million at December 31, 2023[19] - Cash and cash equivalents rose to$92.6 million, up from $87.3 million at the end of the previous year[19] - Total liabilities decreased to$393.9 million from $453.1 million at December 31, 2023, indicating a reduction of approximately 13$777.4 million from $1,034.1 million, reflecting a decline of about 25$185.9 million from $164.6 million, representing a 13$175.5 million from $224.1 million, showing a reduction of approximately 22$(269.3) million for the nine months ended September 30, 2024, compared to $(14.0) million in the prior year[14] - The company recognized a goodwill impairment of$262.5 million during the nine months ended September 30, 2024[20] Future Guidance - Q4 2024 revenue guidance is projected between $141 million and$151 million, with diluted EPS expected between $0.12 and$0.16[4] - The company anticipates continued sequential revenue growth in Q4 2024 across its Medtech & Specialty Audio and Precision Devices segments[2]