Rogers (ROG) - 2025 Q2 - Quarterly Results

Rogers Corporation Q2 2025 Earnings Release Rogers Corporation's Q2 2025 results show sequential sales growth, a significant GAAP net loss due to goodwill impairment, and new cost reduction initiatives Financial Highlights Q2 2025 saw sequential net sales growth to $202.8 million, a GAAP net loss of $73.6 million due to goodwill impairment, and adjusted EPS of $0.34 Q2 2025 Financial Overview | GAAP Results (dollars in millions, except per share amounts) | Q2 2025 | Q1 2025 | Q2 2024 | | --- | --- | --- | --- | | Net Sales | $202.8 | $190.5 | $214.2 | | Gross Margin | 31.6% | 29.9% | 34.1% | | Net Income (Loss) | $(73.6) | $(1.4) | $8.1 | | Diluted Earnings (Loss) Per Share | $(4.00) | $(0.08) | $0.44 | | Adjusted Earnings Per Diluted Share | $0.34 | $0.27 | $0.69 | | Adjusted EBITDA | $23.9 | $19.5 | $31.9 | - The Interim President and CEO noted that sales, gross margin, and adjusted EPS were all within guidance ranges for the quarter[2] - The company utilized its balance sheet to repurchase $28 million of shares during the second quarter[2] Business Performance and Operations Sequential net sales increased 6.5% across AES and EMS segments, with a $76.1 million impairment charge impacting GAAP net loss - Net sales increased 6.5% sequentially, with Advanced Electronics Solutions (AES) up 4.6% and Elastomeric Material Solutions (EMS) up 8.2%[5] - The company recorded a significant restructuring and impairment charge of $76.1 million, which included a $67.3 million non-cash goodwill impairment charge related to the curamik business in the AES segment[6] - The GAAP loss per share of $(4.00) was exacerbated by a $3.8 million valuation allowance recorded against deferred tax assets for certain European jurisdictions[7] - Ending cash and cash equivalents decreased by $18.4 million from the prior quarter to $157.2 million, following $28.1 million in share repurchases and $8.1 million in capital expenditures[8] Profitability Initiatives and Financial Outlook New cost reduction initiatives target over $13 million in annual savings, with Q3 2025 net sales projected between $200M and $215M - New cost reduction initiatives in the AES curamik business are expected to generate over $13 million in annual run-rate savings, with anticipated total restructuring charges of $12 million to $20 million related to these actions[9] Q3 2025 Financial Outlook | (dollars in millions, except per share amounts) | Q3 2025 | | --- | --- | | Net Sales | $200 to $215 | | Gross Margin | 31.5% to 33.5% | | Earnings Per Diluted Share | $0.00 to $0.40 | | Adjusted Earnings Per Diluted Share | $0.50 to $0.90 | - Full-year 2025 capital expenditures are projected to be between $30 million and $40 million[11] Financial Statements The financial statements detail a significant Q2 2025 net loss driven by impairment charges and changes in asset composition Condensed Consolidated Statements of Operations Q2 2025 net sales decreased to $202.8 million, resulting in a $73.6 million net loss primarily due to a $76.1 million impairment charge Statement of Operations Highlights (Three Months Ended) | (in millions) | June 30, 2025 | June 30, 2024 | | --- | --- | --- | | Net sales | $202.8 | $214.2 | | Gross margin | $64.0 | $73.1 | | Restructuring and impairment charges | $76.1 | $1.4 | | Operating income (loss) | $(67.5) | $11.3 | | Net income (loss) | $(73.6) | $8.1 | | Diluted earnings (loss) per share | $(4.00) | $0.44 | Condensed Consolidated Statements of Financial Position Total assets decreased to $1,451.3 million as of June 30, 2025, primarily due to a reduction in goodwill from impairment charges Balance Sheet Highlights (in millions) | | June 30, 2025 | December 31, 2024 | | --- | --- | --- | | Cash and cash equivalents | $157.2 | $159.8 | | Goodwill | $305.9 | $357.6 | | Total assets | $1,451.3 | $1,481.1 | | Total liabilities | $244.6 | $229.5 | | Total shareholders' equity | $1,206.7 | $1,251.6 | Non-GAAP Financial Measures and Reconciliations This section provides reconciliations of GAAP results to non-GAAP measures including Adjusted EPS, Adjusted EBITDA, and Free Cash Flow Reconciliation of GAAP to Adjusted Earnings Per Diluted Share Q2 2025 GAAP loss per share of $(4.00) was reconciled to an adjusted EPS of $0.34, primarily by adding back restructuring and impairment costs Reconciliation of GAAP EPS to Adjusted EPS | | Q2 2025 | Q1 2025 | Q2 2024 | | --- | --- | --- | --- | | GAAP Earnings (Loss) Per Diluted Share | $(4.00) | $(0.08) | $0.44 | | Restructuring, Severance, Impairment & Other Related Costs | $4.14 | $0.32 | $0.17 | | Total Adjustments | $4.33 | $0.35 | $0.25 | | Adjusted Earnings Per Diluted Share | $0.34 | $0.27 | $0.69 | Reconciliation of GAAP Net Income to Adjusted EBITDA Q2 2025 GAAP net loss of $(73.6) million was reconciled to an Adjusted EBITDA of $23.9 million, primarily due to impairment charges Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA (in millions) | | Q2 2025 | Q1 2025 | Q2 2024 | | --- | --- | --- | --- | | GAAP Net Income (Loss) | $(73.6) | $(1.4) | $8.1 | | Restructuring, Severance, Impairment & Other Related Costs | $76.1 | $5.9 | $3.1 | | Total Adjustments | $97.5 | $20.9 | $23.7 | | Adjusted EBITDA | $23.9 | $19.5 | $31.9 | Adjusted EBITDA Margin | | Q2 2025 | Q1 2025 | Q2 2024 | | --- | --- | --- | --- | | Adjusted EBITDA Margin | 11.8 % | 10.2 % | 14.9 % | Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow Q2 2025 free cash flow was $5.6 million, derived from $13.7 million in operating activities less $8.1 million in capital expenditures Free Cash Flow Calculation (in millions) | | Q2 2025 | Q1 2025 | Q2 2024 | | --- | --- | --- | --- | | Net Cash Provided By Operating Activities | $13.7 | $11.7 | $22.9 | | Non-Acquisition Capital Expenditures | $(8.1) | $(9.6) | $(14.1) | | Free Cash Flow | $5.6 | $2.1 | $8.8 | Reconciliation of GAAP to Adjusted EPS Guidance (Q3 2025) Q3 2025 guidance reconciles GAAP EPS of $0.00-$0.40 to adjusted EPS of $0.50-$0.90, primarily adjusting for amortization and restructuring Q3 2025 EPS Guidance Reconciliation | | Guidance Q3 2025 | | --- | --- | | GAAP Earnings per Diluted Share | $0.00 to $0.40 | | Intangible Amortization | $0.11 | | Other Adjustments* | $0.39 | | Adjusted Earnings per Diluted Share | $0.50 to $0.90 |