Third Quarter Highlights
* Product revenues of
* Excluding the impact of foreign currency translation, product revenues decreased 7.3% year over year
* GAAP diluted earnings per share was
* Adjusted earnings per share (see table herein) was
* Secured automotive new business awards totaling
'While supply disruptions and production volatilities will remain challenging in the foreseeable future, our relentless focus on operational execution, innovation and cash flow generation position us well to continue to drive shareholder value over the long term,' continued Eyler.
2021 Third Quarter Financial Review
Product revenues of
Automotive revenues decreased 6.7% year over year, as decreases in Climate Control Seat (CCS), Seat Heaters and Electronics offset revenue increases in all other product categories. Adjusting for foreign currency translation, organic Automotive revenues decreased 7.8% year over year. According to
Gentherm Medical revenue increased 5.9% year over year, primarily due to higher Blanketrol and Hemotherm sales.
See the 'Revenue by Product Category' table included below for additional detail.
The gross margin rate decreased to 28.5% in the current-year period versus 31.8% in the prior-year period, primarily as a result of the negative impact from industry-wide supply chain disruptions, annual customer price reductions as well as wage and material inflation. These were partially offset by cost recoveries from customers and supplier cost reductions.
Net research and development expenses of
Selling, general and administrative expenses of
Restructuring expenses for the third quarter of 2021 were
As described more fully in the table included below, 'Reconciliation of Net Income to Adjusted EBITDA,' the Company recorded Adjusted EBITDA of
Income tax expense in the 2021 third quarter was
GAAP diluted earnings per share for the third quarter of 2021 was
Guidance
The Company is updating its full-year 2021 guidance that was last provided on
Product revenues between
Adjusted EBITDA between 14% and 15% of product revenues
Full-year effective tax rate between 20% and 22%
Capital expenditures between
Conference Call
As previously announced,
A live webcast and one-year archived replay of the call can be accessed on the Events page of the Investor section of
A telephonic replay will be available approximately two hours after the call until
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About
Forward-Looking Statements
Except for historical information contained herein, statements in this release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent
the COVID-19 pandemic and its direct and indirect adverse impacts on the automobile and medical industries, global supply chain and global economy, which had, and may continue to have, an adverse effect on, among other things, the Company's results of operations, financial condition, cash flows, liquidity, borrowing availability under the Company's revolving credit facility, business operations, and stock price;
the loss of any key suppliers, or any material delays in the supply chain of the Company or the OEMs and Tier 1s supplied by the Company, including resulting from a shortage of key components (such as the significant supply disruptions currently faced by the automotive industry, including relating to semiconductors);
reductions in the Company's manufacturing capacity and productivity due to adverse impacts of shifts and turnover in the labor market;
the Company's failure to be in compliance with covenants under its debt agreements, which could result in the amounts outstanding thereunder being accelerated and becoming immediately due and payable;
the Company's ability to obtain additional financing by accessing the capital markets, which may not be available on acceptable terms or at all;
the macroeconomic environment, including its impact on the automotive industry, which is cyclical;
any significant declines or slower growth than anticipated in light vehicle production, and in particular in markets for electric vehicles;
market acceptance of the Company's existing or new products, and new or improved competing products developed by competitors with greater resources;
shifting customer preferences, including due to the evolving use of automobiles and technology;
the Company's ability to project future sales volumes, based on which the Company manages its business;
reductions in new business awards, which were limited in 2020, and could be limited in the future, due to COVID-19, global supply chain challenges and related uncertainties;
the Company's ability to convert new business awards into product revenues;
managing the Company's growth effectively and to integrate successfully any recent business ventures, acquisitions, and strategic investments and alliances into the Company's business;
the loss or insolvency of any of the Company's key customers;
the impact of price downs in the ordinary course, or additional increased pricing pressures from the Company's customers;
the feasibility of Company's development of new products on a timely, cost effective basis, or at all;
security breaches and other disruptions to the Company's IT systems;
work stoppages impacting the Company, its suppliers or customers;
changes in free trade agreements or the implementation of additional tariffs, and the Company's ability to pass-through tariff costs;
unfavorable changes to currency exchange rates;
the Company's ability to protect its intellectual property in certain jurisdictions;
the Company's ability to effectively implement ongoing restructuring and other cost-savings measures or realize the full amount of estimated savings; and
compliance with, and increased costs related to, domestic and international regulations.
The foregoing risks should be read in conjunction with the Company's filings with the
Except as required by law, the Company expressly disclaims any obligation or undertaking to update any forward-looking statements to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
See full release at: https://gentherm.gcs-web.com/news-releases/news-release-details/gentherm-reports-2021-third-quarter-results
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