Diversified, Disciplined, and Delivering - Linamar Generates Strong, Sustained Free Cash Flow

Core Insights - Linamar Corporation reported a significant increase in free cash flow, generating $177.6 million in Q2 2025, up $110.5 million from the previous year, attributed to careful cash management [5] - The company maintained strong liquidity at $1.9 billion, reflecting a 46.7% increase from Q2 2024 [5] - Despite lower sales in the industrial segment, Linamar achieved market share growth in key products and regions within its access and agriculture businesses [1] Financial Performance - Total sales for Q2 2025 were $2,642.7 million, a decrease from $2,848.7 million in Q2 2024 [4] - Operating earnings for the industrial segment were $53.8 million, down from $154.7 million in the same quarter last year, while the mobility segment saw an increase to $152.4 million from $116.8 million [4] - Net earnings for Q2 2025 were $126.9 million, compared to $174.1 million in Q2 2024, with diluted net earnings per share decreasing to $2.12 from $2.82 [4][6] Segment Insights - The mobility segment continued to show normalized earnings growth, with normalized operating earnings increasing by 19.6% to $150.9 million [6] - Market share growth in the mobility segment was driven by new product launches, particularly in North America and Asia Pacific [2] - The industrial segment's normalized operating earnings were $103.3 million, down from $164.3 million in Q2 2024, indicating challenges despite market share gains [4][6] Shareholder Returns - Linamar repurchased 1.1 million shares year-to-date as part of its normal course issuer bid, totaling 1.8 million shares since the program's inception in November 2024 [5] - The company declared a quarterly dividend of CDN$0.29 per share, payable on or after September 9, 2025 [8] Strategic Positioning - Linamar's products remain compliant with USMCA, allowing for tariff-free access to the US market, which has been a strategic advantage amid recent tariff challenges [3] - The company is actively pursuing opportunities arising from customer-driven onshoring and potential acquisitions of distressed suppliers, supported by a strong cash position [5][3]