Axalta Announces Q4 and Full-Year 2024 Financial Results

Axalta Announces Q4 and Full-Year 2024 Financial Results

Axalta Coating Systems a global leader in the coatings industry, has announced its financial results for the fourth quarter and full year ended December 31, 2024. The company delivered record-breaking figures, underscoring its robust performance in a challenging economic environment.

Fourth Quarter 2024 Financial Highlights

Axalta reported record net sales of $1.3 billion for the fourth quarter of 2024, marking a 1% year-over-year increase despite a 1% headwind from foreign currency fluctuations. The company achieved a significant 85% year-over-year increase in net income, reaching $137 million, and improving net income margins by 480 basis points to 10.5%.

The company’s Adjusted EBITDA for the quarter reached a record $275 million, reflecting a 10% increase compared to the same period in the previous year. The Adjusted EBITDA margin improved by 170 basis points, standing at 21.0%. Diluted earnings per share surged by 91% to $0.63, while Adjusted Diluted EPS increased by 30% to $0.60.

Cash provided by operating activities during the quarter was $234 million, down from $286 million in the same period last year. Free cash flow totaled $177 million, compared to $254 million in the prior year, primarily due to higher working capital requirements and increased capital expenditures.

Axalta’s net debt to trailing twelve-month Adjusted EBITDA ratio improved to 2.5x at the end of the quarter, down from 2.9x as of December 31, 2023. The company focused on reducing gross debt, fully repaying the $105 million revolver draw used for the CoverFlexx acquisition. As of year-end, cash and cash equivalents stood at $593 million, with total liquidity at $1.4 billion.

Segment Performance Overview

In the Performance Coatings segment, net sales for the fourth quarter were $843 million, a 1% decrease from the prior year. This decline was due to lower volumes and unfavorable foreign currency impacts, partially offset by contributions from the CoverFlexx acquisition. Refinish net sales grew 2% year-over-year to $545 million, driven by favorable price-mix, new body shop wins, and CoverFlexx contributions, though offset by lower European volumes and currency translation impacts. Industrial net sales decreased 5% to $298 million due to weak demand and currency headwinds.

Performance Coatings generated an Adjusted EBITDA of $198 million for the quarter, up from $192 million in the previous year, with margins improving to 23.5% from 22.6%. The growth was driven by lower variable costs, favorable pricing, and CoverFlexx’s contributions.

In the Mobility Coatings segment, net sales rose 4% year-over-year to $468 million. This growth was largely due to strong Light Vehicle volume performance in China and Latin America, coupled with favorable pricing. Light Vehicle net sales increased 9%, driven by a 6% rise in volume and a 5% positive price-mix, which more than offset currency headwinds. Conversely, Commercial Vehicle net sales declined 10% to $99 million, attributed to lower Class 8 builds in North and Latin America and adverse currency impacts.

Mobility Coatings achieved an Adjusted EBITDA of $77 million for the quarter, up from $59 million the previous year, with margins increasing from 13.2% to 16.4%. This improvement was driven by positive price-mix contributions, volume growth, and cost savings from the 2024 Transformation Initiative, partially offset by labor cost inflation.

Full Year 2024 Financial Results

For the full year 2024, Axalta recorded net sales of $5.3 billion, a 2% increase over 2023. Net income surged 45% year-over-year to $391 million, with net income margins improving by 220 basis points to 7.4%. This growth was attributed to lower variable costs, acquisition contributions, reduced consulting expenses, and savings from the 2024 Transformation Initiative, offset by labor inflation and restructuring costs.

Adjusted net income rose by $144 million year-over-year to $518 million. Adjusted EBITDA for the year reached a record $1,116 million, up 17% from 2023, with margins improving by 280 basis points to 21.2%. Diluted EPS increased 47% to $1.78, while Adjusted Diluted EPS rose 40% to $2.35.

Operating cash flow for 2024 was $576 million, comparable to $575 million in 2023, with free cash flow slightly increasing to $451 million from $447 million the previous year.

CEO Commentary

“Axalta’s 2024 financial results were exceptional. We delivered record net sales and Adjusted EBITDA for both the fourth quarter and full year, despite facing a challenging macro environment,” said Chris Villavarayan, Axalta’s CEO and President. “Our consistent outperformance in Refinish and Light Vehicle segments, combined with excellent execution across the company, resulted in an Adjusted EBITDA margin of over 21%. We remain committed to achieving the goals outlined in our 2026 A Plan.”

Non-GAAP Reporting Updates

Starting with the fourth quarter and full year 2024 results, Axalta has revised its presentation of non-GAAP financial measures, including Adjusted EBIT and Adjusted Net Income, which are used in calculating Adjusted Diluted EPS. Further details are available in the Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on January 21, 2025, accessible via Axalta’s investor relations website.

About Axalta Coating Systems

Axalta Coating Systems Ltd. is a global leader in the coatings industry, offering innovative, sustainable, and high-performance coating solutions. Serving over 100,000 customers in more than 140 countries, Axalta’s products are used in a wide range of applications, from automotive and commercial vehicles to industrial and architectural markets. With over 150 years of experience, Axalta continues to drive advancements in coating technology, helping customers protect and enhance their products.

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