- Excellent new business wins ("NBW") take launch book to more than
$5.0 billion ; - 71% of year to date ("YTD") NBW with electrified vehicles;
- Sales up 27.5% and Net Earnings per Share – Diluted - Normalized up 19.4%;
- Sales up 22.9% for Industrial due to the sales from acquisition of the
Salford Group of Companies ("Salford"), strong agricultural sales on stronger markets and global market share growth and increased access equipment sales; - Sales up 29.2% for Mobility on stronger markets, cost recoveries and launching programs;
- Record levels of content per vehicle1 achieved in
North America andEurope driven by a positive customer platform mix and launches; - An additional 1.8 million shares repurchased in the quarter for a total of 3.5 million YTD; and
- Liquidity1, measured as cash and cash equivalents and available credit as at
September 30, 2022 , was$1.3 billion .
Three Months Ended | Nine Months Ended | |||
(in millions of dollars, except per share figures) | 2022 | 2021 | 2022 | 2021 |
$ | $ | $ | $ | |
Sales | 2,098.1 | 1,645.0 | 5,857.9 | 5,002.1 |
Operating Earnings (Loss) | ||||
Industrial | 84.7 | 70.0 | 145.9 | 179.4 |
Mobility | 100.7 | 86.2 | 317.4 | 351.7 |
Operating Earnings (Loss) | 185.4 | 156.2 | 463.3 | 531.1 |
Net Earnings (Loss) | 133.2 | 108.8 | 334.0 | 370.3 |
Net Earnings (Loss) per Share – Diluted | 2.10 | 1.66 | 5.17 | 5.65 |
Earnings before interest, taxes and amortization ("EBITDA")1 | 298.8 | 260.6 | 794.0 | 854.6 |
Operating Earnings (Loss) – Normalized1 | ||||
Industrial | 74.3 | 72.9 | 137.0 | 185.1 |
Mobility | 94.1 | 77.8 | 287.2 | 339.2 |
Operating Earnings (Loss) – Normalized | 168.4 | 150.7 | 424.2 | 524.3 |
Net Earnings (Loss) – Normalized1 | 121.0 | 104.8 | 301.2 | 370.0 |
Net Earnings (Loss) per Share – Diluted – Normalized1 | 1.91 | 1.60 | 4.66 | 5.64 |
EBITDA – Normalized1 | 282.5 | 255.2 | 756.2 | 855.8 |
Operating Highlights
Sales for the third quarter of 2022 ("Q3 2022") were
The Industrial segment ("Industrial") product sales increased 22.9%, or
- increased sales related to the acquisition of Salford;
- increased pricing to help partially relieve increased supply chain costs;
- an increase in agricultural sales from market growth further improved by global market share growth in all core products; and
- additional access equipment sales.
Sales for the Mobility segment ("Mobility") increased by
- a sales increase primarily attributed to an improvement in adverse conditions associated with supply related issues experienced by our customers compared to Q3 2021;
- increased pricing related to cost recovery partially offsetting the associated raw material, utilities and freight increases;
- additional sales for launching programs and increased volumes for certain programs that the Company has significant business with; and
- increased sales related to the acquisition of the remaining 50% interest in the joint venture of
GF Linamar LLC now known asLLM Mills River ; partially offset by - an unfavourable impact on sales from the changes in foreign exchange rates from Q3 2021.
_____________________________ |
1 Operating Earnings (Loss) – Normalized, Net Earnings (Loss) – Normalized, Net Earnings (Loss) per Share – Diluted – Normalized, EBITDA, EBITDA – Normalized, Liquidity, and Free Cash Flow are non-GAAP financial measures. Content per Vehicle is a Supplementary Financial Measure. Please see "Non-GAAP and Other Financial Measures" section of this press release. |
The Company's normalized operating earnings for Q3 2022 was
Industrial segment normalized operating earnings in Q3 2022 increased
- an increase in agricultural sales;
- increased sales related to the acquisition of Salford;
- an increase in access equipment sales; partially offset by
- increased costs related to raw material, freight and utilities offset by customer cost recovered in sales;
- a reduction in the utilization of Government support programs related to the global COVID-19 pandemic; and
- additional expenses from Skyjack's manufacturing expansion into
China andMexico .
Q3 2022 normalized operating earnings for Mobility were higher by
- a sales increase primarily attributed to an improvement in adverse conditions associated with supply related issues experienced by our customers compared to Q3 2021;
- additional sales for launching programs and increased volumes for certain programs that the Company has significant business with; and
- a favourable impact from the changes in foreign exchange rates from Q3 2021; partially offset by
- a reduction in the utilization of Government support programs related to the global COVID-19 pandemic;
- reduction in earnings related to the acquisition of
LLM Mills River ; - an increase in management, sales costs and travel expenses supporting growth; and
- increased costs related to raw material, utilities and freight partially offset by customer cost recovered in sales.
"It feels great to see a quarter of double digit top and bottom line growth in Q3," said
Dividends
The Board of Directors today declared an eligible dividend in respect to the quarter ended
Non-GAAP And Other Financial Measures
The Company uses certain non-GAAP and other financial measures to provide useful information to both management, investors and other stakeholders in assessing the financial performance and financial condition of the Company.
Certain expenses and income that must be recognized under GAAP are not necessarily reflective of the Company's underlying operational performance. For this reason, management uses certain non-GAAP and other financial measures when analyzing operational performance on a consistent basis.
These Non-GAAP and other financial measures do not have a standardized meaning prescribed by GAAP and therefore they are unlikely to be comparable to similarly titled measures presented by other publicly traded companies, and they should not be construed as an alternative to other financial measures determined in accordance with GAAP.
Normalized Non-GAAP Financial Measures and Ratios
All Non-GAAP financial measures denoted with 'Normalized' as presented by the Company are adjusted for foreign exchange gain (loss), foreign exchange gain (loss) on debt and derivatives, and other items.
Operating Earnings (Loss) – Normalized
Operating Earnings (Loss) – Normalized is a non-GAAP financial measure and the Company believes it is useful in assessing the Company's underlying operational performance and in making decisions regarding the ongoing operations of the business. Operating Earnings (Loss) – Normalized is calculated as Operating Earnings (Loss), the most directly comparable measure as presented in the Company's consolidated statement of earnings, adjusted for foreign exchange gain (loss), and any other items, if applicable, that are considered not to be indicative of underlying operational performance.
Net Earnings (Loss) – Normalized
Net Earnings (Loss) – Normalized is a non-GAAP financial measure and the Company believes it is useful in assessing the Company's underlying operational performance and in making decisions regarding the ongoing operations of the business. Net Earnings (Loss) – Normalized is calculated as Net Earnings (Loss), the most directly comparable measure as presented in the Company's consolidated statement of earnings, adjusted for foreign exchange gain (loss), foreign exchange gain (loss) on debt and derivatives, and any other items, if applicable, that are considered not to be indicative of underlying operational performance.
Net Earnings (Loss) per Share – Diluted – Normalized
Net Earnings (Loss) per Share – Diluted – Normalized is a non-GAAP financial ratio and the Company believes it is useful in assessing the Company's underlying operational performance and in making decisions regarding the ongoing operations of the business. Net Earnings (Loss) per Share – Diluted – Normalized is calculated as Net Earnings (Loss) – Normalized (as defined above) divided by the fully diluted number of shares outstanding as at the period end date.
EBITDA and EBITDA – Normalized
EBITDA is a non-GAAP financial measure and the Company believes it is useful in assessing the Company's underlying operational performance of cash flow and profitability, the effective use and allocation of resources, and to provide more meaningful comparisons of operating results. EBITDA is calculated as Net Earnings (Loss) before income taxes, the most directly comparable measure as presented in the Company's consolidated statement of earnings, adjusted for amortization of property, plant and equipment, amortization of other intangible assets, finance costs, and other interest.
EBITDA – Normalized is a non-GAAP financial measure and the Company believes EBITDA – Normalized is useful in assessing the Company's underlying operational performance of cash flow and profitability, the effective use and allocation of resources, and to provide more meaningful comparisons of operating results. EBITDA – Normalized is calculated as EBITDA (as defined above) adjusted for foreign exchange gain (loss), foreign exchange gain (loss) on debt and derivatives, non-cash asset impairments and any other items, if applicable, that are considered not to be indicative of underlying operational performance.
All these other items contained in these non-GAAP financial measures are summarized as follows:
Three Months Ended | Nine Months Ended | |||
2022 | 2021 | 2022 | 2021 | |
(in millions of dollars) | $ | $ | $ | $ |
Gain on sale of unused land | - | - | (22.1) | - |
Other items impacting Operating Earnings (loss) – Normalized and Net Earnings (Loss) - Normalized | - | - | (22.1) | - |
Gain on sale of unused land | - | - | (22.1) | - |
Other items | - | - | (22.1) | - |
Asset impairment provision, net of reversals | - | 0.1 | 0.1 | 1.7 |
Other items and asset impairments impacting EBITDA – Normalized | - | 0.1 | (22.0) | 1.7 |
Normalizing items for asset impairment provisions adjusted EBITDA and impacted the Mobility segment by
During Q1 2022, a normalizing item related to a "gain on sale of unused land" adjusted the Mobility segment by
All normalized non-GAAP financial measures areas reconciled as follows:
Three Months Ended | Nine Months Ended | |||||||
(in millions of dollars) | 2022 | 2021 | +/- | +/- | 2022 | 2021 | +/- | +/- |
$ | $ | $ | % | $ | $ | $ | % | |
Operating Earnings (Loss) – Normalized | ||||||||
Operating Earnings (Loss) | 185.4 | 156.2 | 29.2 | 18.7 % | 463.3 | 531.1 | (67.8) | (12.8 %) |
Foreign exchange (gain) loss | (17.0) | (5.5) | (11.5) | (17.0) | (6.8) | (10.2) | ||
Other items | - | - | - | (22.1) | - | (22.1) | ||
Operating Earnings (Loss) – Normalized | 168.4 | 150.7 | 17.7 | 11.7 % | 424.2 | 524.3 | (100.1) | (19.1 %) |
Net Earnings (Loss) – Normalized | ||||||||
Net Earnings (Loss) | 133.2 | 108.8 | 24.4 | 22.4 % | 334.0 | 370.3 | (36.3) | (9.8 %) |
Foreign exchange (gain) loss | (17.0) | (5.5) | (11.5) | (17.0) | (6.8) | (10.2) | ||
Foreign exchange (gain) loss on debt and derivatives | 0.7 | - | 0.7 | 1.2 | 6.3 | (5.1) | ||
Other items | - | - | - | (22.1) | - | (22.1) | ||
Tax impact | 4.1 | 1.5 | 2.6 | 5.1 | 0.2 | 4.9 | ||
Net Earnings (Loss) – Normalized | 121.0 | 104.8 | 16.2 | 15.5 % | 301.2 | 370.0 | (68.8) | (18.6 %) |
| ||||||||
Net Earnings (Loss) per Share – Diluted | 2.10 | 1.66 | 0.44 | 26.5 % | 5.17 | 5.65 | (0.48) | (8.5 %) |
Foreign exchange (gain) loss | (0.27) | (0.08) | (0.19) | (0.27) | (0.10) | (0.17) | ||
Foreign exchange (gain) loss on debt and derivatives | 0.01 | - | 0.01 | 0.02 | 0.09 | (0.07) | ||
Other items | - | - | - | (0.34) | - | (0.34) | ||
Tax impact | 0.07 | 0.02 | 0.05 | 0.08 | - | 0.08 | ||
Net Earnings (Loss) per Share – Diluted – Normalized | 1.91 | 1.60 | 0.31 | 19.4 % | 4.66 | 5.64 | (0.98) | (17.4 %) |
EBITDA and EBITDA – Normalized | ||||||||
Net Earnings (Loss) before income taxes | 176.5 | 146.6 | 29.9 | 20.4 % | 443.0 | 499.7 | (56.7) | (11.3 %) |
Amortization of property, plant and equipment | 95.7 | 96.0 | (0.3) | 285.2 | 301.2 | (16.0) | ||
Amortization of other intangible assets | 15.0 | 12.7 | 2.3 | 42.5 | 36.8 | 5.7 | ||
Finance costs | 8.7 | 4.4 | 4.3 | 17.4 | 14.6 | 2.8 | ||
Other interest | 2.9 | 0.9 | 2.0 | 5.9 | 2.3 | 3.6 | ||
EBITDA | 298.8 | 260.6 | 38.2 | 14.7 % | 794.0 | 854.6 | (60.6) | (7.1 %) |
Foreign exchange (gain) loss | (17.0) | (5.5) | (11.5) | (17.0) | (6.8) | (10.2) | ||
Foreign exchange (gain) loss on debt and derivatives | 0.7 | - | 0.7 | 1.2 | 6.3 | (5.1) | ||
Asset impairment provision, net of reversals | - | 0.1 | (0.1) | 0.1 | 1.7 | (1.6) | ||
Other items | - | - | - | (22.1) | - | (22.1) | ||
EBITDA – Normalized | 282.5 | 255.2 | 27.3 | 10.7 % | 756.2 | 855.8 | (99.6) | (11.6 %) |
All normalized non-GAAP financial measures areas impacting segments reconciled as follows:
Three Months Ended | Nine Months Ended | |||||
2022 | 2022 | |||||
Industrial | Mobility | Industrial | Mobility | |||
(in millions of dollars) | $ | $ | $ | $ | $ | $ |
Operating Earnings (Loss) – Normalized | ||||||
Operating Earnings (Loss) | 84.7 | 100.7 | 185.4 | 145.9 | 317.4 | 463.3 |
Foreign exchange (gain) loss | (10.4) | (6.6) | (17.0) | (8.9) | (8.1) | (17.0) |
Other items | - | - | - | - | (22.1) | (22.1) |
Operating Earnings (Loss) – Normalized | 74.3 | 94.1 | 168.4 | 137.0 | 287.2 | 424.2 |
EBITDA – Normalized | ||||||
EBITDA | 100.2 | 198.6 | 298.8 | 187.4 | 606.6 | 794.0 |
Foreign exchange (gain) loss | (10.4) | (6.6) | (17.0) | (8.9) | (8.1) | (17.0) |
Foreign exchange (gain) loss on debt and derivatives | 0.2 | 0.5 | 0.7 | 0.3 | 0.9 | 1.2 |
Asset impairment provision, net of reversals | - | - | - | - | 0.1 | 0.1 |
Other items | - | - | - | - | (22.1) | (22.1) |
EBITDA – Normalized | 90.0 | 192.5 | 282.5 | 178.8 | 577.4 | 756.2 |
Three Months Ended | Nine Months Ended | |||||
2021 | 2021 | |||||
Industrial | Mobility | Industrial | Mobility | |||
(in millions of dollars) | $ | $ | $ | $ | $ | $ |
Operating Earnings (Loss) – Normalized | ||||||
Operating Earnings (Loss) | 70.0 | 86.2 | 156.2 | 179.4 | 351.7 | 531.1 |
Foreign exchange (gain) loss | 2.9 | (8.4) | (5.5) | 5.7 | (12.5) | (6.8) |
Other items | - | - | - | - | - | - |
Operating Earnings (Loss) – Normalized | 72.9 | 77.8 | 150.7 | 185.1 | 339.2 | 524.3 |
EBITDA – Normalized | ||||||
EBITDA | 83.3 | 177.3 | 260.6 | 221.1 | 633.5 | 854.6 |
Foreign exchange (gain) loss | 2.9 | (8.4) | (5.5) | 5.7 | (12.5) | (6.8) |
Foreign exchange (gain) loss on debt and derivatives | 0.1 | (0.1) | - | 1.3 | 5.0 | 6.3 |
Asset impairment provision, net of reversals | - | 0.1 | 0.1 | - | 1.7 | 1.7 |
Other items | - | - | - | - | - | - |
EBITDA – Normalized | 86.3 | 168.9 | 255.2 | 228.1 | 627.7 | 855.8 |
Other Non-GAAP Financial Measures
Free Cash Flow
Free Cash Flow is a non-GAAP financial measure and the Company believes it is useful in assessing the Company's ability to generate cash. Free Cash Flow is calculated as Cash from Operating Activities, the most directly comparable measure as presented in the Company's consolidated statements of cash flows, adjusted for payments for purchase of property, plant and equipment, and proceeds on disposal of property, plant and equipment.
Liquidity
Liquidity is a non-GAAP financial measure and the Company believes it is useful in assessing the Company's ability to satisfy its financial obligations as they come due. Liquidity is calculated as Cash, the most directly comparable measure as presented in the Company's consolidated statements of financial position, adjusted for the Company's available credit.
All other non-GAAP financial measures are reconciled as follows:
Three Months Ended | Nine Months Ended | |||
2022 | 2021 | 2022 | 2021 | |
(in millions of dollars) | $ | $ | $ | $ |
Free Cash Flow | ||||
Cash generated from (used in) operating activities | 118.3 | 281.2 | 247.1 | 691.1 |
Payments for purchase of property, plant and equipment | (83.4) | (58.6) | (256.3) | (169.0) |
Proceeds on disposal of property, plant and equipment | 1.8 | 1.3 | 34.8 | 5.7 |
Free Cash Flow | 36.7 | 223.9 | 25.6 | 527.8 |
Liquidity | ||||
Cash | 856.0 | 806.0 | 856.0 | 806.0 |
Available credit | 435.0 | 957.5 | 435.0 | 957.5 |
Liquidity | 1,291.0 | 1,763.5 | 1,291.0 | 1,763.5 |
Supplementary Financial Measures
Content per Vehicle
Content per Vehicle is a supplementary financial measure and is calculated within the Mobility segment for the region indicated as automotive sales less tooling sales divided by vehicle production units.
Summary of Content per Vehicle by Quarter
The following table summarizes the updated CPV for the current year for changes in volumes as revised by industry sources:
Estimates as of | Three Months Ended | Year to Date | ||||||
2022 | 2022 | 2022 | 2022 | 2022 | 2022 | |||
Vehicle Production Units | 3.68 | 3.70 | 3.81 | 3.68 | 7.39 | 11.20 | ||
Automotive Sales | $ 765.0 | $ 870.6 | $ 918.9 | $ 765.0 | ||||
Content Per Vehicle | $ 235.03 | $ 241.01 | $ 221.35 | $ 228.04 | ||||
Vehicle Production Units | 3.91 | 3.98 | 3.58 | 3.91 | 7.89 | 11.47 | ||
Automotive Sales | $ 390.4 | $ 396.0 | $ 372.6 | $ 390.4 | $ 786.5 | |||
Content Per Vehicle | $ 99.83 | $ 99.53 | $ 103.95 | $ 99.83 | $ 99.68 | $ 101.01 | ||
Vehicle Production Units | 11.31 | 10.28 | 12.46 | 11.31 | 21.60 | 34.05 | ||
Automotive Sales | $ 135.2 | $ 97.7 | $ 149.6 | $ 135.2 | $ 232.9 | $ 382.5 | ||
Content Per Vehicle | $ 11.95 | $ 9.50 | $ 12.01 | $ 11.95 | $ 10.79 | $ 11.23 |
Estimates as of | Three Months Ended | Year to Date | ||||||
2022 | 2022 | 2022 | 2022 | |||||
Vehicle Production Units | 3.70 | 3.69 | 3.70 | 7.39 | ||||
Automotive Sales | $ 761.6 | $ 870.6 | $ 761.6 | |||||
Content Per Vehicle | $ 220.76 | |||||||
Vehicle Production Units | 3.90 | 3.94 | 3.90 | 7.84 | ||||
Automotive Sales | $ 390.6 | $ 396.0 | $ 390.6 | $ 786.7 | ||||
Content Per Vehicle | $ 100.30 | |||||||
Vehicle Production Units | 11.31 | 10.02 | 11.31 | 21.34 | ||||
Automotive Sales | $ 133.9 | $ 97.7 | $ 133.9 | $ 231.6 | ||||
Content Per Vehicle | $ 11.83 | $ 9.75 | $ 11.83 | $ 10.85 |
Change in Estimates from Prior Quarter | Three Months Ended | Year to Date | ||||||
2022 | 2022 | 2022 | 2022 | |||||
+/- | +/- | +/- | +/- | |||||
Vehicle Production Units | (0.02) | 0.01 | (0.02) | - | ||||
Automotive Sales | $ 3.4 | $ - | $ 3.4 | $ 3.4 | ||||
Content Per Vehicle | $ 1.78 | $ (0.67) | $ 1.78 | $ 0.60 | ||||
Vehicle Production Units | 0.01 | 0.04 | 0.01 | 0.05 | ||||
Automotive Sales | $ (0.2) | $ - | $ (0.2) | $ (0.2) | ||||
Content Per Vehicle | $ (0.31) | $ (0.94) | $ (0.31) | $ (0.62) | ||||
Vehicle Production Units | - | 0.26 | - | 0.26 | ||||
Automotive Sales | $ 1.3 | $ - | $ 1.3 | $ 1.3 | ||||
Content Per Vehicle | $ 0.12 | $ (0.25) | $ 0.12 | $ (0.06) |
Forward Looking Information, Risk and Uncertainties
Certain information provided by
Such forward-looking information may involve important risks and uncertainties that could materially alter results in the future from those expressed or implied in any forward-looking statements made by, or on behalf of,
The foregoing is not an exhaustive list of the factors that may affect
Conference Call Information
Q3 2022 Release Information
Q4 2022 Release Information
Guelph, Ontario
SOURCE
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