Sensata(US:ST)2024-04-29 21:16Financial Performance - Net revenue for Q1 2024 was $1,006.7 million, a 0.9% increase from $998.2 million in Q1 2023, with organic revenue growth of 2.3% after excluding a 1.4% decline due to foreign currency exchange rates [84][90]. - Operating income decreased by $4.1 million, or 2.7%, to $144.8 million (14.4% of net revenue) compared to $148.8 million (14.9% of net revenue) in the prior year [84][88]. - Performance Sensing net revenue increased by 6.8% to $713.3 million, with an organic growth of 8.6% after excluding a 1.8% decline from foreign currency effects [91]. - Sensing Solutions net revenue decreased by 9.0% to $257.8 million, with an organic decline of 8.3% primarily due to inventory destocking in industrial markets [92]. - Net income for Q1 2024 was $76.0 million, representing 7.6% of net revenue, down from $86.4 million (8.7% of net revenue) in Q1 2023 [89]. - Adjusted operating income for Q1 2024 was $188.5 million, with an adjusted operating margin of 18.7% [127]. - Adjusted EBITDA for Q1 2024 was $223.8 million, compared to $225.5 million in Q1 2023 [131]. - Reported net income for Q1 2024 was $76.0 million, down from $86.4 million in Q1 2023 [127]. - Adjusted net income for Q1 2024 was $134.6 million, with diluted EPS of $0.89 [127]. Cash Flow and Liquidity - Operating cash flows generated in Q1 2024 were $106.5 million, with cash and cash equivalents totaling $460.4 million at the end of the quarter [85]. - Free cash flow for Q1 2024 was $64.4 million, compared to $60.0 million in Q1 2023 [128]. - Cash and cash equivalents totaled $460.4 million as of March 31, 2024, down from $508.1 million at the end of 2023 [133]. - Net cash provided by operating activities for the three months ended March 31, 2024 was $106.5 million, an increase from $96.9 million in the same period of the prior year [138]. - Net cash used in investing activities increased to $42.1 million for the three months ended March 31, 2024, compared to $22.9 million in the prior year, primarily due to higher capital expenditures [139]. - The company believes its current sources of liquidity will be sufficient to fund operations, capital expenditures, dividend payments, and debt service for at least the next twelve months [144]. Debt and Financing - Total debt and finance lease obligations were $3,400.4 million as of March 31, 2024 [132]. - Gross leverage ratio remained stable at 3.8 for both March 31, 2024, and December 31, 2023 [132]. - Net leverage ratio increased slightly to 3.3 as of March 31, 2024, from 3.2 at the end of 2023 [132]. - The company had $3.4 billion in gross indebtedness as of March 31, 2024, which includes finance lease and other financing obligations [141]. - As of March 31, 2024, the company had $746.1 million available under the Revolving Credit Facility, net of $3.9 million in obligations for outstanding letters of credit [143]. - Interest expense decreased by $10.4 million to $38.4 million due to the repayment of debt in 2023 [103]. Corporate Actions and Outlook - The company realigned its business segments, combining Automotive and HVOR businesses to enhance resource allocation and product focus [86]. - The company anticipates capital expenditures of approximately $175.0 million for fiscal year 2024, which it expects to fund with cash on hand [139]. - Moody's Investors Service assigned a corporate credit rating of Ba2 with a positive outlook to the company as of April 20, 2024 [145]. - Corporate and other expenses (GAAP) for Q1 2024 were $(80.3) million, compared to $(62.4) million in Q1 2023 [129]. - The company repurchased 0.3 million ordinary shares under the September 2023 Program during the three months ended March 31, 2024, with approximately $461.8 million remaining available for repurchase [149]. - Aggregate cash dividends paid in the three months ended March 31, 2024 were $18.1 million, compared to $16.8 million in the same period of the prior year [150].