ADNT - Earnings call 1 2024

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Operator

Welcome to the Adient First Quarter Financial Results Conference Call. [Operator Instructions] Today's conference is being recorded.

Now, I'll turn the conference over to Eric Deighton. Sir, you may begin.

Eric Deighton

Thank you, Shirley. you first us quarter thank Adient's we and for results fiscal morning, for as joining review Good XXXX. our the The for press section to our slides adient.com. of Investors call today release have been and website at presentation posted Adient's This Executive and Executive President Officer; morning, Officer. Financial our Chief and Oswald, President Chief Jerome Mark I'm by Vice joined Dorlack, and for fiscal our On by Mark, followed today's the QX results on financial business, call, of Jerome update will the and outlook will XXXX. provide review remainder an who prepared our open call After we remarks, the to will your questions.

are to Before cover. I'd few the call I to turn Jerome over and like Mark, there a items

I today's conference our actual caution could based see Slide are as call. you differ First, statements results we the forward-looking to these safe refer materially the will X uncertainties. harbor call for it on today statements. of involve statements presentation would These the statement. complete Please therefore, made environment forward-looking that on and from include and a risks

the Dorlack. the evaluating be Jerome full in discussing to GAAP be In addition that non-GAAP will basis, performance. call for useful information release. is my in to our these equivalent over financial GAAP I'll a to concludes now closest Reconciliations believe found comments. measures we company's non-GAAP appendix we operating the of the on presented earnings can results This turn the

Jerome Dorlack

the call; XXXX. review Thank morning. year Good we you to analysts our as Eric. joining investors first Thanks, for prospective quarter investors, our fiscal results and

Turning to Slide X.

few to quarter. related the comments Let with a me begin

performance, Despite short-term and the management beginning actions including day-to-day focus improvement. disruptions to us that and the business company in from while the maintained maintaining As execution the laser The strike-related we any on quarter, challenges allowed continuous impacts. its XXXX, the execution execution began business production the focus launch on operational successfully cash focus on operational team driving navigated fiscal challenges is the navigate of forward.

UAW ultimately metrics Adient which our financial on of to key certain for X%. quarter. by liquidity are totaled in of quarter, Turning for cash approximately down side to the $X.X quarter million year's strike impacted last EBITDA. slide. the a at about million $XX sales billion, million American first compared the balance respectively. customers -- totaled quarter was total The shown Adient's $XXX quarter strong $XXX right-hand North $X.X the the which Adjusted and up EBITDA the billion and million, for Adient fiscal ended of $XXX with in quarter, and Revenue X%

continue slide, of of the in as drive customers and margin manufacturing to the discipline. winning the and bottom customers forward, improvement continued ability capabilities, our each to our expected new process to proof At industry highlighted through customers our footprint of the add value business We number awards demonstrating to engineering to and delivering years. both our received QX replacement that commitment points coming excellence. with regions in a in we've We're drive business are of

received, show employees. we've our sustainability including operational and For customers, towards and the excellence that to shareholders, mindfulness stakeholders and value recognition awarded driving and business been business strong have Adient the suppliers we performance, are

shareholders capital the detail our the $XXX and will Mark balanced sustainability transformation. capital on discuss sustainability company production a million its strategy. production long-term integrated the clearer the to to resolution which environment quarter, through in XXXX talk of but shareholders deployed in about our capital moment. an into number we more Again, within the strike-related the capital this core sustainable shows our repurchases firmly achievements balanced highlight last return I'll has business. became the toward on of of accomplishments As highlighting our allocation of its our demonstrate share following of slide, disruptions, that a path is that part Adient point to important slide strategy. commitment marking more resumed released allocation a return commitments The toward the report, next we've We

Slide we further and on Turning that lot X a years report began to X sustainability our has publishing Since point. changed. ago, annual

aligning limiting the environmental which have focusing well. on not goals on both As environment social ESG the greatest The commitment impact. can on impacts to are our create is focused how those our report that This planet our strategic sustainability own sustainability but everyone. we economic customers evolved operate where outlines evolved, a has our goals, sustainable and has well. transformation have changed as better support to thing sustainability not product to our in ongoing to only includes our our on design environment priorities negative we as development our activities our a for and changes the of and deliver focus long-term One

highlights We've the mission, link we've to on deliver a in journey sustainability the read report. included there as year accomplishments won't future. in report, we take and I see You the focused fiscal our in examples minutes of milestones few products, the these commitments more slide within the can of number made advance reflect full our these sustainability Please each progress on this achieved and the processes a XXXX. to highlights on to but and see we and are a people. intend

turning to X. Now Slide

wins launch Let's take look performance. and a at our business

several As launches. recent the we see highlight Slide X, and you important ongoing can of on

JIT, and in levels in production support discipline vertical that the environment and winning. integration that foam, disrupted deepening the including the execute process business us was the execution of quarter, Although and business our enabled Americas are metals launches effectively launches, trim to we in our on

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X. Slide to turning Now

mix continues execution advances and value a when various business levels and our the are integration fiscal Adient This to new driven engineering, recent by drive These our hybrid once and trend metals. allows starting represent purchasing in in operational expertise integration electric, awards us business customers for recent ore year our deep of several portion some of and a foam, our seating supported on and 'XX, logistics, Bridgewater awards we geographies, by new vertical chain. I'd by XX% highlighted especially like business volume that highlight control venture. ICE deepening last joint in also trim sourcing platforms. value vertical greater is than awarded a new contained BEV usual, note customers, Interiors sales of fiscal More program business here. of a of Important to to level the As year strong a levels and of in again that wins.

but We'll is on long content creature is relevant cabin Customers crash seat also features the management interior time. comfort it talked this a later As proud few. Safety sound comforts and Adient, a an becoming like with increasingly X. vehicle to competitive provide JV. venture as and a for massage that pelvic sustainable in steel have win recline, recently. to features trends in reimagined Flipping Adient, efforts. reduction seating opportunity configuration represent China that surface seating and carbon a partnership like level diverse both trend a complexity non-leather Deep we along opportunity XX seeing been are reminder, joint These in around change by We've materials Avanzar innovations as advantage low involved Delta manage. of have goals Slide more at interior for details an and specifically and which like about the to have this that a emerging increased more diverse the rails, that BWI brings we're the name seat the of successful We're particularly years. our ESG also will than to and driven are venture, and we cost increase joint

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create and us have to this we while improvement own mapping our we both our with our processes can fiscal value frame our footprint, assembly is metals particular to Our improving and able financial to us opportunities the that available enable we leveraging for solutions range engineering increasing to enable knowledge business how cost. that year. and to waste, our to customers and existing capabilities manufacturing performance. that industrialize. pan to these into modular the execute and opportunities modular We're not footprint improvements customers encompasses driving able but modules to evaluating like manage use back world-class and and planned metals takeaway freight also share execute We leverage opportunities continuous essential reduce ESX for engineer to can The key can that value the important By on carbon benchmarking, in processes We're identify assemble inventory ESX operate for practices manufacturing benefits. that business. during in our and network business that assembly. real footprint optimization. the to a opportunity. simplification efficiencies It's that process only the this we continually on give efficiencies that our demonstrate own, we to identify bring customer estate ability note order cushion leverages to production customers. reducing We're of commitments go VAVE labor, It's deliver we operational and Adient We stream and seat, complexity

'XX, Turning to cash. end conserve cautious to reasons now. there and the Slide into year were fiscal X of be Heading

time, was longer-term our our With prepare looming to balance a the production for at in strategy strike disruption Americas. the sheet the

resolved, generate around clear the to balance line production approximately repurchases free sheet on uncertainty the the company around returned we're million year, the the cash flow get for cash. cash With to shares. was shareholders our totaling of good breadth sight As million on via and able X of to clarity and length disruption $XXX ability

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Our extend in significant confidence underpin our B With to we the enabled along with us and flexibility the the strength and sheet balance to the ability turn to our say performance will company's to over capital have amend I Term subsequent generate that structure to expected Loan to it the our quarter. to Mark into financial also returns shareholders. Safe cash built is cover financials. that, to

Mark Oswald

Jerome. Thanks,

XX. right Let's side. Adhering side the formatted reported jump on with our the on and to results our the typical into page results adjusted financials is Slide on left the our format,

on We will trends special either in focus onetime view nature important skew our we that items results, otherwise the as commentary which the adjusted or exclude in performance. underlying

the the biggest the of of quarter, adjustments the our quarter of reported the and difference level extent, $XX share. I'll appendix for impairment between lesser per amortization The and to accounting by drivers is For for periods purchase results net year. and timing EBITDA presentation. related these year-on-year. million lower $X.X between in costs. stoppages were Lower quarter. drivers the the of economics. adjusted Details the impact increase mix improved performance. was the million, with benefits $XXX with attributed material High restructuring business at on FX line, our $X.XX benefits are about income volume to the Adient the our all to the the Adjusted quarter X% partially bottom a offset negative and were impact offset periods. resulting were of volumes, to of and or These and from Americas compared primarily quarter strike-related last of billion, production customers up at currency down partially positive first a between two movements for expand were Sales in minute.Finally, associated the results primarily X% in just approximately movements adjusted reported

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impacted regard production revenue, by resulted in With to unconsolidated exits. to new side derived, production the stoppages program benefited in right-hand sales. full as certain in that well launches X%. primarily Wrangler on expect were basis. as increase lower In a driven sales in RAM, that performance Americas the programs market offset Pacific, midsize up of as lower table the sales strong planned customers while of favorable by the from still and about was where of Adient's by launches strike-related the and production certain year top of year-on-year such line China was the sales which were GM's quarter on note, about and in Europe, for Adient's by like FX. program place Important Focusing on EMEA to XX% was China, Tacoma. were and In outpace majority like Americas the grew driven FVW in are year program were regional in taking platforms slide, In unconsolidated large program Adient's end SUVs sales year-on-year a results adjusted Asia by the model China, the consolidated key The mix, we changeovers Toyota. seating

Additionally, joint BYD. with Chinese benefited and SAIC, production growth venture our Chery customers, domestic Keiper from including

to the in year was results, the with Moving XX. EBITDA benefiting We've a $XXX periods. adjusted the EBITDA The page quarter of to business detailed into the year-on-year we a between million are picture, expected $XXX ago. quarter was our quarter. current $XX by the of driver consistent what drivers the of performance Improved Slide provided the primary segments bridge on performance reported are show primary comparison versus million. adjusted heading and the million Big of

Looking bucket, the million. improved margin deeper net driver within that material of was $XX biggest positive

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spend. million. Similar High of past agreement bucket I'll the expect by expect provided by the results. material fiscal we margin commentary on year change. very FX to improved and inclusive tooling. higher the several remainder did was have certain which onetime all, factors, pressures offsets performance year the the Thai revised of from recoveries Americas, the what the as the few in material business agreement. intensify such in headwind, program increased spend. in All in headwind we November, net joint the performance headwind our quarter, note line positive and well and These partially performance Currency period move a Yen restructured a certain and income between Equity in and business Baht. lesser the related labor lower In Again, revised In our we've the within volume the from of strong of with influenced can This Asia, benefit of improved offset and in $X net year-on-year quarters, as as slight pricing through was driven and net as the drove indicated to performance headwinds, agreement between was for much as benefits of did the and factor performance million currency internal costs execution. And not the detailed And slides appendix JV. joint launch were a by restructured margin, the was EMEA, overhead costs, within lower consolidated for we primary finally, As quarter recognized Keiper at presentation. our our segment as improved prior modest mix movements we to and inefficiencies partners our Volume minutes. the a equity additional commercial venture a business commodities, in view we Business continued SG&A customer repeat increased improved negative level headwind. pricing a be at primarily to were and resulted lower as as FX Keiper was the comparison benefited by business income which to more launch offsetting periods pricing of driving Americas improved Japanese for performance by expect agreement within was launches, benefits expectations, the year. the the the engineering the impact to timing that favorable timing the pricing that of result driven mix. Partial Keiper not increased venture, drove onetime joint just overhead. was Important was venture. year-on-year driven $X finally, and a labor performance aided the business freight extent, Adient's well which a activity, engineering repeat was launch business benefits in last than temporary launch by resulting the lower reflected mix these movements, we performance.

mentioned program changeovers that slide, of model was region end certain I Adient's mix other impacted on of previous As by production in the year and models.

We and continue regional to balance the mix volume expect and performance for the strong year. of

Let year-end. the line expectations. we in won't it $XX Adient quarter are out is point the At side impact an year-on-year primary December me outflow relative testament cash the now improvement we $XX each factored is cash Flipping XX. Starting Adjusted operating as last of important of Slide in shift out the various with quarter. improvement for free and was was of XX. drivers low-cost the XXXX, receivables Slide $XX programs CapEx, XX our point, an million outflow structure I fiscal to execute last million capital the The flow, within listed first Slide The continues despite internal modest quarter call versus million source with cash the liquidity. strike on as the liquidity management outflow actions to at slide. This the compares of the million. had in XX, to UAW cash, to on a but to the a utilize One team of to flow, quarter. and right-hand factoring year's cash on defined less to our of slide, as read $XXX on XX. cash able that

net with $X.X noted we of $X.X December the comprised about quarter line billion on at As right-hand $XXX about million billion, the totaled of $XXX XX, Adient's XXXX. under of credit. billion side ended slide, total debt liquidity million position of Adient's and capacity respectively, revolving of undrawn and $X.X debt cash on and the hand

respect the to important page, several side capital highlights with structure. right-hand our of have debt and lower the On we noted

returned we First, as quarter. the $XXX Jerome earlier, to shareholders our in million discussed

previously, our As share execute combined our company's underpins ability our ability repurchase the we sheet, program. indicated in on the the balance generate to cash with confidence to cash

a As our $XXX remaining reminder, on have repurchase authorization. share we million

particularly our The maturity plus XXXX. not well cash Term still. debt sitting the outstanding and our improvement years. X.XXx, share X.X XX-basis the capital targeted the and and commitment within amend a the Our of the the to a increased is evaluate earnings January, validation flexibility The to as pricing as and improves amendment positive from years part the generation. of structure we're well execute our ratio Global ended The actions company's an of B to after to X.X SOFR reshaping team a recent point is corporate and generate extended couple growth, We Both as to cash continue capital well progress to The with our leverage in to X.X allocation trend repurchases XXX, the to our recognized the Moody's opportunistically range sheet our credit company's of of quarter certain the Xx. good company's current are and will That and rates. current the seen consolidated important upgrades ability top currency will extend enhance execute fiscal updated forecast. and that strategy. made remainder S&P been while revised guidance our manufacturers what recent delays demand. our China, favorably limited outlook of reflect Geely. flexibility to customer direction, and is upward by flip Adient's Cap have conditions, we weighted a our result assumptions FX forecast local up Euro, to let's group expected the Adient's select in heavily versus on outlook in review were such and has impact alignment driven forecasts as customer structure. launch line opposite weighted with programs BYD, of more XX net are year moving production QX for results HX. including catching revisions billion. In $XX.X aware With of our is and production the content, fiscal XXXX. further increased, primarily balance between past Loan and that, and to the Slide of sales ratings HX said, the market Adient net to we've respectively. over of $XX.X The We've as strength Adding in to that December tenor demonstrates land to already years deal SAIC, This movements, releases, towards the towards in of earnings with of 'XX are billion a external average S&P based revenue with production

we're half all-in our previous guide Based timing margin current our year adjusted a lumpiness of also versus into EBITDA, QX is the One as to quarters. it's half continues just first the as equity to driver key at earnings seasonality outpace improve prior Adient's performance the FX-adjusted our Important driven, last settlements million of represents New Last on discussed margin is decrease to consistent by Business commercial for this of well be margin regard $XXX second earnings, the on $XX was as For the pull-through. to With guide, XXXX. significant sequentially decrease see QX. between the an our year. to XX QX, X.X% revenue note, expected similar a over the point reaffirming anticipate China from in income driver implied points and of cadence the of the of business first I with year-on-year second course, we lower half EBITDA equity example, significant as for income, basis years, the million. of to a performance move given fiscal income, expansion volumes normal EBITDA a we of common outlook our equity Adient's year, expect Year. quarter growth.

still million. expected interest well cash $XXX and were our planned to continue at actions forecast completed interest on, be is about rate million, debt previous given Term taxes $XXX expense that balances Moving expected expectations. recently about B Loan contemplated as at the Cash within guidance. Note and as our

expected For free purposes, have largely is finally, expense million. And for Again, $XXX is change remain change Operator, stable. at cash the flow to that, let's at move launch call. our modeling we from estimated the guide. CapEx, no customer no is based portion $XXX of question-and-answer million first tax at cash the November. our calls November question, $XXX the on please? forecast can million, from With schedules, as

Operator

now begin first Research. question-and-answer the Rod comes [Operator question with from will Lache session. Our Instructions] We Wolfe

Rod Lache

your million flow, remind staying towards questions. $XXX which nice And A complete the looks achieve see versus you of almost leverage it of $XXX million Can repurchases remind $XXX debt? cash in cash earmark much could free you share remaining actually targets. is authorization your would really imply can you us $XXX like It's how Because million, while couple still in you the now? the of cash million to excess you acceleration still share minimum maybe us, would repurchases. just position do if

Jerome Dorlack

on the macro could of with, look see overall the company we the for not cash. That times a extra there. think start said, environment, strong question, to allocation capital do call The Rod. it, to about cash at Rod, to Thanks Yes. million we are I that year, there the this want we certain think the run is Yes, I little run off with with right, a way share that or whether repurchases. we're also $XXX

could debt, stock and adding take our is do though, the we generate year, clearly, through go as at we where an we that more we through opportunity about have to some right? cash. million, right? to call be look So notes higher pacing that, bit And of trading year, a as of little There we'll move there. I this to take be X.X% to it expect down approach price measured have care again, looking We $XXX of balance that as a have XXXX. do approach that balanced at We the

Rod Lache

like transactional million headwinds. and something in just net it's is positive. of performance Could headwinds, despite this performance? And And the labor positive pace the the is improving for you that of worth. transactional $XXX actually like is fact, headwinds? mitigating you mentioned look are achievable labor does margins even to with It that us what remind a what actually achieve impact The

Mark Oswald

Yes.

then So and me feel let jump in. start, free Jerome to

to right. we you're in we means challenges to we where that or in continues before offset indicated positive performance positive labor We're absolutely continues of cetera, which camp et the to be $XX the million be improve. had terms said inflation, sit better So we as FX we macro or And this was to year. about Rob, that be needs Business all to continuous external have today, improvement. our right? still headwinds business going such So along, a headwind get thought to that performance

We basically our out It's in we efficiencies improve. continues have and core pull operating freight That lower right? I'd to to just just through. helps that have say, to what costs, balance balance

Jerome Dorlack

and leapfrog Yes. out some activities be, roll countries on and when and kind to respect we enabling programs some and can in and looking business progress of journey talked really it would blocking all these into labor we just actually question, started warfare of together 'XX, chunks I our legacy really to some actually modularity, them it we of about around are way and we've that market. front. cost trench we'll them enabling relocating with to take 'XX, and more we get of out see kind start of remapping concert of the that what metals of lost of and on not what's continue like of really of but big with and to call in get taking we the And off next and been we're very chunks you into I'd core the standard supply our them this is And that We've to some the to some customer Rod, expect at we've so conduct particular, get large and -- some other we roll redesigning long-distance then will when just the it chains 'XX in And and piece some talk things â€˜XX out, as tackling, the progress ESX of I'd rolling related priced make about say, of eliminating things would now we that lower displacing day-to-day or we portfolio. and JIT, our and of that 'XX. it's for week, roll your that. as And projects, to what's There our say highlight the correctly continue into business in â€˜XX what in we continue that's, vocal. that's and changes. down make is with

Operator

from question John next with Our America. Bank of comes Murphy

John Murphy

can, that's mailing ICE simply EV what's all volumes around far rates if and as an an it been much out EV as penetration could just versus and you you to ICE happen or you capital your how exposure potential run what and relative impacts versus in general. and how broken there's on Jerome, through kind about as it allocation of content going as is the think wonder Obviously, I here. business

Jerome Dorlack

Yes.

and I ICE between would think we it EV, say. about content really region, varies when by think I

in contented when see at and side high platforms the we is to EV and Xx on China, on -- have end, you the almost NIO ICE the at vehicle look Yanfeng platforms there. content compare And we our the especially or go you if that we if look market per to just Yanfeng, of market multiplier why EV China. with our when China, and level for would we kind penetration, generally by of vehicle an because there. where we're us versus it's if that's high-end you in their and in a EV, almost and which the ICE that versus it's that's very acceleration segment, I a call an we EVs, house, to per Here we in what dollar EVs, Really the EV. average Americas, push China, In just think and of NIO Xx in content highly compare see penetration Xx by

pelvic into is Americas. belts things effect look China crash in we've So the you content now read sound a seats, to per this we management, think massage when talked at Europe And that's you into vehicle. where lot and multiplier about systems, being across are and when see really those

in trim we've existing their at your to vehicle. leveraged run when side-by-side leveraged EV looking on least got counterparts, deployment, we question, such We've we're leveraging counterparts Where really of platforms the lines, kind footprints. this big see fixed and the second existing we're somewhat have think, brick-and-mortar, If the with ICE the existing really where with into and able and deployment play with to agnostic. that content building, labor. really or costs. the risk those comes that things per where JIP capital can very either off other metals we capacity platform, a you EV we we bunch of where JIT, or haven't counterpart, volume and the ICE run the Americas have of or stranded not accelerator with the particularly or we and long-distance an two more EV volume. have offset capital and EV at utilize hit, the into brick-and-mortar like can, programs went been, that's doesn't and of exposure after don't from put of versus asset so We've new trim that So their ICE platform installed building platform, it we building stewards brick-and-mortar. side-by-side capital To We're we an and I foam the or we've ICE good

able that to effectively. of and lot do Americas been the we've pretty a Europe And have costs. don't stranded in we really So

business this right the have cost don't we big now. fixed So on overhang

John Murphy

incredibly just Yes. helpful. That's a And question. then second

your exposure in manufacturers? for unconsolidated just business, totality the rebalanced your remind to domestic repriced, consolidated the the us Chinese can and With JVs exposure you and being

Mark Oswald

John. Yes. it's XX-XX, Right now, about

to we've XX% exposed XX% out flips. if though, go X about is foreign. the that So years, What next you indicated over domestic,

on based so years, on And to our foreign. XX% it X business XX% wins, to over next to exposed becomes domestics, local we see launching X based what the

Operator

Rosner question Emmanuel with Deutsche comes next Bank. Our from

Emmanuel Rosner

how growth and this slide 'XX? around the balance about your and year. this puts a In volatility if the of question it market I'm for do fiscal and outlook mix. obviously lot you high just for discuss of launches is performance, expectation there level, My is of around first think around the discussing takes some for platform a at could the the you quarter curious program fourth

Jerome Dorlack

Yes, hand from just it. kind of over be, say, to I'll kind with We year growth finish said, balance of I'll overall QX. still China we've to to market were despite expect it between flattish a at China, that, positive over we expect start growth be over we and Mark then in to regions. significantly market we as where the for entire standpoint, looking to I'd the still how at

things. versus kind of Americas will the go certain the kind Americas, impacted down down in and in really really especially Wrangler will regions, then our If market by versus launches within through versus flattish and on and And certain where certain effect and of Wrangler particular, an year launches Tacoma in just Toyota the that's other markets, at that market, Europe, the other launches you be of then in Asia with are shifts. year, we out platforms -- those be There certain looking customers market. taking have this

are that want of the in will it's don't launches that. always other continuing on along Mark, off wind if And there in we've drive those color customers. certain with there reductions shift just I we've programs to know, of and impact programs wound an said any nonprofitable Europe, off you then add that. the Americas, it's So that with

Mark Oswald

think I was us, over good -- that China so engine right? for only reiterate, just we're basis And XXX, is there. still market The growth XXX the expecting, I'd growth call a it, summary. of points No,

there. good a story So news

Emmanuel Rosner

helpful. shifting the really to then margin That's And outlook.

you're years call balance for points your of what bits improvement. specific guiding question? years, line X over like guess, take this To about, be to, or number actions for a an know of do opportunity time So of the a of rather? beyond, there specific X it, programs, Do of about XX unwinding of it is XXXX? improvement. get framework like would these accelerate you I some Is Obviously, my time was let's say, there

Jerome Dorlack

the like margin you planning a should strategic that, we are through of certain we I looks achieve go of And at at pull we the to to certain have strategic that and and time our line we where a our plan, that's look evaluate it, go business an those cycle. is to still we X% what and What through and the we We'll plan Mark business. layout. the, platforms, potential and and at we through now as our with And of our portfolio look that I, when go this this business that business, and get as would call back think mean, programs it through look strategic Mark go to continue say with come be into ICE the sit, believe, I and it business extension to metals and firmly leverage what at. and to I the of looks target is, extension So I and X% the kind our like. to Emmanuel, where

Operator

Fargo. Colin comes Langan from question next Wells with Our

Colin Langan

Great.

ask actually Just was the going I about follow-up color, a metals to the business. on

there's in that -- mentioned, off. million-ish so roll I $XXX that -- a needed you've of the unprofitable So to business past, about is guess,

And you overall how that of So delayed? is on talking system is now that's 'XX, 'XX, having actually that is a now to 'XX? to instead in more comments, sounded about business need more then whole 'XX, like be little also your metals the important. And going integration, in metals the we positive

view So business is your a sort bit little of of that becoming optimistic? long-term more

Mark Oswald

our off that us could certain of 'XX, 'XX Clearly, and jump in and programs. But of metals Yes, their have customers we they Jerome business certain as that you're to run continue I'll then expanded absolutely right, in. rolling ICE are want planning those. start to

with run they Obviously, et there'll have them, earlier. what to talking And how discussions Jerome that's want And this. so cetera. to evaluate long about some commercial be we was

process, X that. years very or call past, those strategic it, to the through what is very to because and are we years targeted ones now of and absolutely to win And we business We do what do business that that want certain in with the for over as very about. favorable talking call strategic value, us the right? a now was we understand through go to and have good parts I'd terms modularity levers no Jerome what you're So plan left and in which gone X business metals we've of are like with right, which that wanted that that metals things there chunk added we've of are been

Jerome Dorlack

how production there's with the like extremely concept, of real order need certain to this precious. be quickly that Yes, concept if seeing really drive particular, and fan just on solutions routing we're And front. that sequences, that imagine pan acceleration we're you drive and portions we what cushion on real sensors off this said, drive real building detection certain on to where occupant have it. where able assembly business, and harnesses, That proving just based Mark beneficial can year. that you rapid route we're and to putting that, this and in a modular design authority, extremely calibration estate sequence of certain sequences very And accelerate really assembly and in customers and to proving And wire to assembly have them, precious. seen you is be into authority estate that things sourcing be and proven estate to what it's to we've really to is modular

our our now that at that does revisit strategic have of really that are what again, lingering commercial footprints business go be going a metals to metals agreements programs anticipating is impact off are on it accelerator. our with or were and customers, roll and That asset need and we real plan. to said, yes, certain look back So certain those to, an to we there is that proving be either

Colin Langan

and Got takes puts then to it. And the within guidance. going back just

that some some or I recoveries thought of think had of quarter to of level initial million any like $XX almost guidance? any on million be It Is performance? $XX like the suppliers been expecting driving that. of I have recoveries. are something the And sort had update most there commodities. in health Just And of this guidance headwinds. clear, feels

Jerome Dorlack

is the in business expecting Yes. Absolutely, recoveries through performance we included go there. as recoveries, we're right, recoveries commercial

fiscal as So right? QX as the through go of quarters, be I we Now Colin, lumpy, smooth indicated will they in are example, tend those for from the the year, but again, different right? going QX, course prepared the the to over out lumpy you're You HX, there during million a year. remarks, we little get there a But I was into right From go HX that smoother a right? as that saw went the we commodities about bit as into aspect, is just element from in that there. benefit $XX

versus more As the I price at else gross timing as QX I timing at related results, overall at of coming recoveries those looked that price, the anything though, again, down, look clearly, right? this point. than So

Operator

Joseph from comes with question next Our Spak UBS.

Joseph Spak

Maybe was it that of up X%, seem just to timing the ex really strong, stronger recoveries in closer picking the margin even those the like bit. there in quarter, strike, because, but does obviously, a results little did America, the help North

a how decline guess there's And parts the maybe JV in that of we period And So what or sort it unusual broadly, expect with out then sounds Peso lumpiness? bunch sort occur? of and much of North more just of was sequential with should moving America the to sort of Keiper benefit. of of that like sort I the

could date, expansion you of the given But we think year? North sort American there the the that going year, hinted down puts margin expansion. of see really over that and the could back some for sort I to ex-strike to strike, the knock course previously, that the takes of show be with is or some performance even

Mark Oswald

even expect wouldn't timing of indicated. my through Joe. going right? margin go Yes. QX, ex-strike, and they We kind first expectations as for be commercial be year, we terms recoveries, with out take in So lay the cetera, of commercial just as could lower in to quarter I et recoveries, I the year-on-year, there's Clearly, do that expansion

we're And consistent prior as do with comments, our margins. so expect the around -- that I

Jerome Dorlack

that's that provide -- want I'd to Americas really behavior. the is impact, especially in for quarter-to-quarter on the business why expect and Americas the business And of difficult performance Americas, lumpiness We of associated good quarter-to-quarter And timing basis. margins example strike -- comments business of this it's Yes. why kind the recoveries first couple there. or But Americas, just really, to what general say any a segments, to commercial that look a driven the were within that Americas. of there. a just don't quarter some kind we don't really run That's expanding at the when we anymore a of guidance with be And one key And of was out on the to year-over-year we just is there because segment. expect of we in by that lot reason quarter-to-quarter reason. in one our what's of see of operating us even drive really,

Joseph Spak

are just still just in of you then expect to And meaningful commentary. there mentioned, outperformance want in some to -- market statements growth getting there Okay. it of for first China, like I underperformance was meaningful a the because back the but over couple the you obviously, seemed odds quarter, year. at

you of it, how it the from you was don't was of sort lot I showed think in some players when quarter But have then prepared that last a your comments, talked about almost production with. of you uplift content XX%.

the over balance outgrowth acceleration So that really the year? in what sort of drives the of

Mark Oswald

And of think and cadence right? launches. the launches, the it's I pacing those

obviously, certain it's performing We our very going the fourth they're to customers through mentioned, of year-end that of we quarter, know hit strong that BYD, the in example, for that's QX. quarter those calendar are first launches our certain targets, So right? their year, the we in whether SAIC,

where we or predicated again, QX, going on as understand So all right? on also curves guidance. to that's based we're our through go be We those launch QX,

we points progress indicated. the XXXX, I'd basis go that as we XXX, So to through outperforming ultimately and by expect that improve XXX

Operator

from question [Operator Instructions] Barclays. Our next with comes Dan Levy

Dan Levy

a just in I time for you. the you've talked I of BYD. to which some think I your win slide is, BYD don't you new about about wins. go past specifically, the the first wanted This to talked And we've seen think, in

much you amount expecting China, the the talk positive revisions be responsible given that specific in might forward. But about and BYD talk you I don't going maybe So for you BYD some generally customers. about with could of is particular this just know win what

Jerome Dorlack

to on one it supply have supplier. I going of in of deep can us words and really we're mean And known for really I is willing they ability with through value us. that a portion a the details, of JIT us for piece value amount really component a to of a and how to team, shows their think, in-house in demonstrate for total portion conquest customer our segment. the that and It's lot the to have, on go significant of important, a to particular, of side We're customer on without they I very expertise components call, trim components component for value Yes. show, I on play our their a in-house BYD of type think the to of to seating it foam just don't demonstrate we just have where, chain, on demonstrate a our our we was side. would win do outsource. a couple they drive seating provide and And they team the company and what that willing into that seating expertise for very be And on that and there.

ventures, this in JIT for call toe through had water one that joint there in BYD, to joint it joint add call first that Keiper We of in they breakdown, us, significant don't that a point And BYD. always we have, view on with tremendous a very did earnings our of that Keiper But to really call, it's QX had so a our of we of, the the it to complete BYD, joint real prior where of our holder through dip into and significant through income And FY 'XX a of was and them ideas mechanism trim side of amount is of side announced I metals the venture, directly a that out in through indirectly as venture BYD's seat amount our get included customer foam, is And through venture. way the a kind win through value. directly out XX-XX the that important think we're foray house a another venture. that the it, a we do kind side through customer break well. joint obviously, also JV of wasn't

So We've well. there's Keiper been that growth the through been as then equity and through growth side enjoying there. income

Dan Levy

Great.

follow-up, a in America. want about to specifically As and North mix ask I

think I obviously, we mix you SUVs, know, vehicles. perspective, tremendously from a benefit larger X-row from

the to would one are some you? you prices, to impact slightly to negative the out extent mix think hold X%? path critical mix to what there negative now with mix shift in could be the in if industry, is for X% is right And How your maybe still questions in getting path the of I margin? there and is the industry. What they where potential to

Mark Oswald

minimis, piece. de It's right? very small it's Dan, a Yes,

to volumes us enabler I achieve that the going As be, X%. we've Mix, all indicated again, and about stability those say, to it's would for what is not before, the of volumes.

Jerome Dorlack

I low-end agree certainly to agree. mix high-end Nothing along I those it's vehicles, is lines, think. Yes, and It add. to more I a between with nothing Mark.

Operator

further back time, no speakers. showing call questions. the the At this over I'll to I'm turn

Jerome Dorlack

me available day it. Appreciate throughout be be any happy necessary call. other the follow-ups to We'll joining as afterwards. We'll the questions. or for everyone, Mark. take out or Thanks, to for Reach

So we very have much. you the Thank day.

Operator

may today's you. this Thank This We you conference. participation. At conclude disconnect you lines. your your time, for thank does

Adient (ADNT) 7 Feb 242024 Q1 Earnings call transcript