CTS(US:CTS)2025-04-30 17:55Financial Performance - Net sales for Q1 2025 were $125,769, essentially flat compared to Q1 2024, with a 13.6% increase in diversified end markets and a 12.1% decrease in transportation markets [105]. - Gross margin increased to $46,549 in Q1 2025, up 3.2% from Q1 2024, with gross margin percentage rising from 35.9% to 37.0% [106]. - SG&A expenses were $23,623, representing 18.8% of net sales in Q1 2025, compared to 17.7% in Q1 2024, primarily due to higher depreciation and amortization expenses [107]. - R&D expenses were $6,190, or 4.9% of net sales in Q1 2025, down from $6,601 or 5.2% in Q1 2024, reflecting continued investment in product development [108]. - Restructuring charges decreased significantly to $451, or 0.4% of net sales in Q1 2025, from $1,693 or 1.3% in Q1 2024, due to headcount reductions in response to softening demand [109]. - Net cash provided by operating activities was $15,518 in Q1 2025, compared to $18,311 in Q1 2024, with net earnings contributing $13,367 [114][115]. - Cash and cash equivalents were $90,288 as of March 31, 2025, down from $94,334 at December 31, 2024, with total long-term debt at $86,700 [113]. - The effective income tax rate decreased to 17.1% in Q1 2025 from 18.6% in Q1 2024, attributed to a change in the mix of earnings taxed at lower rates [111]. Market Impact - The SyQwest acquisition contributed an additional $2,987 in net sales, while foreign exchange rate changes negatively impacted net sales by $835 year-over-year [105]. - Significant customers included Toyota Motor Corporation at 11.9% and Cummins Inc. at 10.3% of total net sales in Q1 2025 [125]. Risks and Uncertainties - The company emphasizes that forward-looking statements regarding performance and financial condition are subject to risks and uncertainties, which may cause actual results to differ materially from expectations [126]. - There have been no material changes in the company's exposure to market risk during the three months ended March 31, 2025 [127].