Adient(ADNT) - 2024 Q3 - Quarterly Results

Financial Performance - Q3 FY2024 reported revenue was $3,716M, an 8% decrease compared to Q3 FY2023, with adjusted EBITDA of $202M, down 27% year-over-year[2] - Adjusted net income for Q3 FY2024 was $29M, with adjusted EPS diluted at $0.32, compared to a net loss of $11M and EPS diluted of $(0.12) in the same quarter last year[2] - Adient reported net sales of $3,716 million for the three months ended June 30, 2024, a decrease of 8.4% compared to $4,055 million for the same period in 2023[19] - The gross profit for the same period was $207 million, down from $302 million, reflecting a gross margin of 5.6%[19] - Adjusted EBITDA for the three months ended June 30, 2024, was $202 million, with an adjusted EBITDA margin of 5.4%[29] - Net income attributable to Adient was a loss of $11 million for the three months ended June 30, 2024, compared to a profit of $73 million in the same period last year[19] - Adjusted net income attributable to Adient was $29 million, down from $93 million in the previous year[39] - Adjusted diluted earnings per share decreased to $0.32 from $0.98 year-over-year[44] - Adjusted EBIT margin was 3.4% of net sales, down from 4.8% in the same quarter last year[38] - Total net sales for the quarter were $3,716 million, compared to $4,055 million in the prior year[38] Cash Flow and Debt - The company generated free cash flow of $88M in Q3 FY2024, compared to $143M in Q3 FY2023[10] - Cash provided by operating activities was $158 million for the three months ended June 30, 2024, down from $203 million in the prior year[26] - Net debt as of June 30, 2024, was $1,647 million, an increase of 15.6% from $1,425 million as of September 30, 2023[54] - Total debt as of June 30, 2024, was $2,537 million, slightly up from $2,535 million as of September 30, 2023[54] - The net leverage ratio increased to 1.87 as of June 30, 2024, from 1.52 as of September 30, 2023[53] Segment Performance - The Americas segment reported adjusted EBITDA of $99M, while EMEA and Asia reported $25M and $101M, respectively, with overall performance impacted by lower customer production[8] - Adient's Americas segment generated net sales of $1,737 million, while the EMEA and Asia segments reported $1,288 million and $712 million, respectively[29] - Adjusted EBITDA for the Americas segment was $99 million, up from $95 million in the same period last year, while EMEA dropped to $25 million from $103 million[31] Outlook and Strategic Initiatives - The FY2024 outlook was updated to reflect consolidated sales of approximately $14.6B, down from a prior estimate of $14.8B-$14.9B[12] - Adient China is expected to drive double-digit growth in the coming years, focusing on innovation in seating comfort, connectivity, and sustainability[4] - The company is advancing automation and AI tools to improve operational efficiency and reduce costs[5] - The company is focused on deleveraging activities and expects to improve its financial position in the upcoming quarters[16] Costs and Expenses - Corporate-related costs increased to $(23) million from $(22) million year-over-year[31] - Restructuring and impairment costs rose to $(16) million from $(6) million in the same period last year[31] - The company reported a net financing charge of $(48) million, slightly down from $(49) million in the previous year[31] - Adjusted equity income for Q2 2024 was $23 million, down 14.8% from $27 million in Q2 2023[46] - Net financing charges for Q2 2024 were $48 million, unchanged from Q2 2023[48] - Operating cash flow for Q2 2024 was $158 million, a decrease of 22.1% compared to $203 million in Q2 2023[50] - Free cash flow for Q2 2024 was $88 million, down 38.5% from $143 million in Q2 2023[51] - Adjusted EBITDA for Q2 2024 was $202 million, a decline of 26.9% from $276 million in Q2 2023[51] - Capital expenditures for Q2 2024 were $70 million, compared to $60 million in Q2 2023[50] Taxation - The company reported an adjusted effective tax rate of 40% for the three months ended June 30, 2024[17] - The effective tax rate for the three months ended June 30, 2024, was 88.9%, significantly higher than 22.8% in 2023[41]