- Earnings call transcript Q3 2022

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Operator

Good morning and welcome to Gentherm Inc. 2022 Third Quarter Results Conference Call. [Operator Instructions]. Please note this event is being recorded. I would now like to turn the conference over to Yijing Brentano. ahead. go Please

Yijing Brentano

gentherm.com. good today. and morning, and for available thanks a Thank earnings morning, results us at is release Gentherm’s of this were joining copy you, the everyone, released and earlier

later Additionally, a webcast website. the of today’s Gentherm’s Relations of today be section call Investor on will replay available

them, law. risks update other filings, Please Gentherm’s actual earnings Statements of and materially. make events except latest subsequent views discussions and the current with factors undertake and to SEC future its we During within to uncertainties see meaning our as our this may required risk call, differ of for reflect the reports underlying financial results performance, by no release such obligation and and including XX-K statements We statements. forward-looking federal may securities laws. respect and forward-looking

are financial During as GAAP these financial discuss measures measures to Reconciliations release defined by measures in the may comparable of call, Regulation G. or investor non-GAAP included we the presentation. our earnings non-GAAP SEC financial

today with Chief Chief Anversa, and Officer; the Executive call President Eyler, Matteo are Officer. Phil and Financial On me

prepared pleased During website we deck gentherm.com/events. we on have available be Phil our Matteo to be remarks, take their to your that a made After will and their referring comments, presentation at will questions.

to to like Phil. turn over I’d the call Now

Phillip Eyler

highest we the with I’m you, performance Yijing. achieved Thank an Good revenue of during morning organic you history for the on solid pleased which third everyone us today. in thank joining basis. and the company quarter, quarterly

medical. proposition quarter which Dacheng in the automotive the and and Medical, In of Gentherm we acquisitions closed addition, value Alfmeier both expanded during

Alfmeier key translation us that we foreign the well to I by our markets two third am the XX%, currency acquired cost of With in points. is translation. the share actual our The vehicle revenues implemented outperforming Adjusting year-over-year the we the of XX% on in impact , actions currency grew starting year-over-year have light realize schedule XX% goals, or XXX of and are of will acquisition, increased businesses XX% excluding underway. addition already basis to enable and quarter, nearly in Alfmeier synergy XXXX. foreign production progressing pleased for integration and automotive Dacheng that

our third benefiting value Demand continues market be pneumatic for from already especially as customers milestone EV importantly, More the quarter. are strong, expanded massage thermal proposition. and comfort the lumbar of evidenced Gentherm our our and achievements by in solutions, to

one First, one which for combined manufacturers comfort our we in global largest awards our pneumatic on single a and EV is award of thermal also inaugural want the the largest with of history. EV

first microclimate zone announced feature awards Second, the Celestiq market EV system Gentherm XXXX be to the we solutions. our of traction growing recently innovative equipment. climate Cadillac that underscore as to will sense standard the vehicle These for

continue third our improved and of as cost quarter, one supply face semiconductor shortages performance the the inflation, level environments margin During chain we thank our to few a toughest stringent results team and efforts growing year-over-year like financial appropriate in global on minutes. provide customers. details will profitability and in cost Matteo labor a other Nevertheless, the our of of all recoveries negotiation operating challenges. quarter from for result to more cost with management second from material our I’d their sequentially. and

OEMs, Greatwall, Motors, solutions third across on XX automotive XX including turning General X. BMW, Honda, the Mercedes Toyota Benz, Xpeng. different In vehicles the our quarter, slide Now launched we to on and highlights automotive

in a sense microclimate offers every potential features climate XX help as Honda our partnered occupant. and unique well In of the the of A X-power and vessel Gentherm We pickup X quarter electric CCS standard system future deployment Celestiq climate level presenter sense see ago individualized a couple equipment. on range. working SUV. V conjunction solutions electronics series, is include advanced climate each with of cooling maximizing devices solutions luxurious, We the Xpeng launched the the heating the system Cadillac in inclusion vehicles. efficiency system with both Celestiq comfort a display cabin improve and of Los while desired of and technologies and algorithms for and technologies, content Cadillac crossover to comfort, Celestiq driving this cabin climate increased sense software design ICE to The for momentum efficient how sense deliver XR demonstrates that four Celestiq allow interactive climate of create vehicle. auto that turning new participated airflow Cadillac Celestiq and with zone CCS were makers this on point reveal first as EV vehicle personalize for BMW continue weeks System feature Cadillac industry’s microclimate that advanced demonstrative will at while on optimizing The global and debut truck, to contribution truly significant third our to can our the GX SUV Gentherm’s Angeles. in extraordinary occupants event. their The of energy personalized comfort. the event marks to

a other preparing launch globe to this There has company of amounts to many OEMs tremendous our across since of of idea and hard the production addition continue we an the stones I’m creativity programs progress development it’s and the as future growth. whiteboard. make by General on towards Motors, achievement climate of means sense milestone our for been on multiple work for projects stepping important began one proud flawless In as with innovation, with truly an our across what teams regions.

secured include The can wellness acquisition, on Since quarter of expand opportunities to excitement efficiency. announcement comfort, pneumatic and energy its X beyond the to remains value of solutions support company third see and million strong. thermal health, the combined in the that Gentherm and pipeline $XXX our further of the for awards you Slide we resoundingly have Alfmeier where automotive. expressed in see Now customers to proposition

we the and we vehicle earlier, I As electric of OEM. combined continuing EMA that with incremental in Rover with won the to including for well note eight Volkswagen heater pleased receive Enclave, important thermal on like for one the multiple also is comfort business also one global to quarter. and vehicle we Audi. This brands multiple largest models CCS this OEMs. third of included quarter, in awards six award XX Honda as third Acadia, the this mentioned GUV’s relationship sedan, Buick congratulate to and wheel awards won manufacturers across for Sylphy, I’m first to the These steering CRV, platform. as from and pneumatic Nissan our book the we generation on Palisade the I’d next Hyundai EV our LXX quarter, Land GMC grow award customer. In team have already multi Gentherm strong and EV the

compelling of capabilities With technologies, well more to combined offer one solutions teams customer the high integration the across of underway, the Alfmeier leverage complementary relationships. and focus value to key is and areas

Our the customers, teams positioned are vehicle and demand especially And content the working to significantly highest bring in diligently to important vehicles market. which solutions designs. solutions Gentherm space innovative for compact integrated comfort continue the for manner to to increase efficient is as electric as expand is performing wellness most well electric our we integrate in vehicles that

some led and X in and our spending. financial managing quarter eight a are This Dacheng driven cases, discussion ex-FX revenue by awards X% Chinese has Dacheng spending Hospitals purchasing grew a year-over-year our in slide large of Medical capital the in In freezes. in turning the quarter third hospitals. acquisition primarily to their competitive medical. facing Now to of carefully medical business. X for reduction pressures are increasing

hospitals for provides rental long quarter. equipment hospitals market to rentals company partner have recently blanket partnership capital that we three solution needs. need funds for I’m a U.S. order -- with with all but don’t and purpose rental received term that the budgeted from a a As entered equipment, term we a to in the the third short equipment for share that key capital pleased this with

Virginia In University of quarter, South the existing grew added addition, expand both AstroPad businesses in to international system also and Virginia third air to use rolls America. awards Newark, throughout we Jersey, Hemofarm Arlington, Center In in and warm Hospital hospitals. their with their Hospital fleet blanket our New in

summarize. Now, me let

demonstrate of quarter industry third term. trends unique mid effectiveness in growth and focus the strategy, validate positioning on mega long our capitalize the to and Our results our

the We pneumatic for challenges and pressures continue to quarterly operate revenue our environment. delivered company time. some industry believe highest thermal in first continue history that supply in and and secured we an chain Nonetheless, extremely will for challenging award comfort. combined inflationary We

color on profitable call with Matteo focused remain while reasonable to financial continuing to will execution cost results. to order in With collaborate that, our long customers little cost I’ll management on for a term more growth. over We the aggressive recovery and for deliver turn the innovation,

Matteo Anversa

Phil. you, Thank

items significantly Let quarter me on impacted our and turn X, most focus to the are third slide results. that

to outperformed XX in year, currency of and as to China, prior of period compares in America, the same quarter the compared and by product and by Europe, the with XX% vehicle the automotive XX%. the of we our million for volume from FX, revenue were light contribution to markets by impact Korea a For vehicle translation, increased automotive a from XX% revenues Starting XX% just corresponding key Alfmeier foreign XXX the light basis compared the and we nearly production mentioned, contribution the overall including segment, This for our last by revenues acquisitions. Adjusting revenue points. acquisitions increased adjust actual to XX%. period. the Phil increase North automotive production year XXX If product increase Japan the increased million,

thermal multiple higher Stellantis revenue steering as due sales period. revenue in to GM, due on increased customers. electronics Toyota revenue impact higher by increased Jeep non-automotive FX [Indiscerenible]. by the CP increased and the increased and from decline specifically, manufacturers. of And X% to to due to our product on due increased several electronics to Ford, solutions Revenues to of XX% increased growth automotive by as growth BPS several Renegade ECUs our to revenue higher for revenue largest and by the one sales X% higher proprietary XX% sales. all in on by with SUVs, higher automotive multifunction TCS heaters platforms, GM primarily increased sales significantly year-over-year due more sales was revenues Excluding sales XX% of and in models. management compared XX% EV battery the well and offset global higher prior to demand due wheel and GM continued trucks lines SUVs. Electronics the Honda Ford the to

Our higher impact foreign of net due exchange. year sales conditioners, Alfmeier increased automotive interiors. two comparable XX% grew excluding the And XX% to or the finally, prior automotive from by period, revenue and month

driven by segment. year Moving contribution medical. or capital prior due revenues in to X% Dacheng Revenue of FX we to of the the FX Dacheng the the contribution compared U.S. the reduction to and hospitals. primarily medical was exclude for the in up X% if Adjusting medical spending declined flat

quarter margin. year of quarter XX.X Gross to million impact third XX.X% rate recoveries X.X quarter. expenses. Turning and primarily million, Sequentially excluding were were was third improvement rate our restructuring The next higher XXX higher negative to XX.X%. exchange. year margin from this volume for fixed for factories million we amount acquisition as the second the driven the the organic quarter, recoveries Gentherm lower of business, periods, RGC. wages, partially of acquisition which operating approximately XX impacts to we the second and gross well a X.X delivered from customers, rate prior compared customer. operating by were included If from driven by If from the basis of to and in impact relative market in year on compares in current rate period. margin period freight approximately negotiated acquisition Alfmeier as inflation adjust in to both partially we points in to in which costs. expenses, when sales with offset gross has lower and price the million by cost move in expenses worth quarter incurred was acquisitions, up higher leverage third in XX.X XX.X% million last third It of XX.X% year-over-year the for increase and XX.X by the that XXX These incentive a increases expenses the quarter. at restructuring the costs fixed the gross in to basis decrease sequential that gross driven margin million ago higher costs was to the increase material quarter, do from million higher is acquire year million XX.X% and of noting as the offset compensation by compares that mind foreign associated businesses same cost as well and sales Please leverage we year. organic up additional quarter volume, XX% productivity quarter The the point The This not was of X by from impact expenses our the partially fourth was keep control. the used last the the occur expect lower approximately cost tighter business X in adjustment offset favorable approximately from in adjustment to incentive and compensation in of SG&A cost

diluted the XX.X period third Adjusted expenses two increased million, EBITDA XX.X margin only the XX%, adjusted for which months in points prior the the operational acquisitions prior operating quarter. period. EBITDA from margin quarter acquired points basis costs the from XX issues. approximately year approximately was In impact temporary businesses. included from discrete quarter The of cost addition, and to by EBITDA XXX in up approximately basis the was of the XX.X% Adjusted was driven of up million the X.X% address on second in

to last year. $X.XX adjusted the per share share, compared third Finally, of quarter per earnings in $X.XX share the diluted quarter per in was

Our the We earnings. rate the slightly the in sheet approximately now quarter over above move balance effective third X. to geographic quarter unfavorable was to due tax slide XX%, on mix prior

a a million, was of the training X.X. position our million at of the leverage quarter the increased our of liquidity credit and of the cash we target had below Our second to end the million of compared format, at and at September September and from net approximately of end from available debt on on We the as still XXX on closed the end Alfmeier well And the change to quarter positive result, availability quarter by was acquisitions. approximately Dacheng X.XX to of the million. negative position million XX, XXX cash driven EBITDA XXX quarter. The in adjusted June. the total borrowing X.XX net in remaining XXX our fund million XXX revolver Based net consolidated of XX, the the down prior XX was XXXX line of our as

respective let slide turn to of results for the acquisition. date which includes of Now, the since me guidance XXXX X expected our businesses their acquire

full company call. guidance as We’re discussed the in earnings maintaining our total XXXX year prior

year the to X.XX expect to continue billion range FX remains to assuming of in We at product X.XX revenues current the billion, be for the levels.

in EBITDA of adjusted XX%. expect range We the margin in XXXX to be XX% to

XXX single rate million Our acquisitions. guidance approximately adjusted margin low now of revenue, EBITDA two digit the assumes and from

our the million end expect towards session. to to XX% end range to to that, back be the call XX% XX range rate to of of the begin I’ll with be the tax effective million. the full expenditures, of the at capital of year gutter Q&A to And the operator higher XX turn We lower and

Operator

Thank much. you very

from ahead. [Operator Instructions] answer and question the Koranda Matthew go The begin the Capital. session. with first of ROTH now Please will line We question comes

Matthew Koranda

the Good taking thanks guys. And morning. questions. Hi, for

the Or helpful. sort quick kind two? that a was characterize the Just opportunistic? words to that just is and out the has the off? And it to the last could kind environment. with award combines to of also one, awards, off if When Or thermal combined could awards. of there Alfmeier to one you core that just on Gentherm least see sort if were quarter, pipeline think directionally of wanted you I wanting start the be a Honestly, pipeline size the was able versus in guys is pneumatic more then you there two there. that maybe breakdown that break at maybe speak just the And of of

Phillip Eyler

Matt. thanks, Sure,

of of lighter First pretty the terms is the in pleased we’re all, that of just amount typically in a activity. quarter with little awards the on quarter, side bit

good So it was quarter.

about combined awards will awards products the the pneumatic the typical I than not second the Getting terms specific breakdown significantly down your say going but that to awards thermal of in were In we’re question our our break the higher the as awards yes, in to practice, definitely sense quarter. through One interest we couple several is build some same from see of a second is for the purchasing of a you’re standpoint, reasons. one starting makers a lot with the bundle technology integration. decision typically And to OEMs. makes customers, to the that portfolio, as the going

it a makes so for And lot sense a negotiate of them to package.

large certainly that’s combined of manufacturer. really first that we’re excited win So seeing, EV what but with we’re kind global about

Matthew Koranda

of then And the of to curious I little of verse outperformance can holdups higher production regions terms you on little in the maybe bit of relative bit just outperformance on causing you production a nitpick of that to what give that you mix just kind if typically terms to not lower production mean, you’re color supply and any in of on are chain maybe in front seeing outperformance guys or of a respective sort are regions? relative kind production your level that

Phillip Eyler

question, many very headwinds good. did it Outperformance point out. unfortunately we Yes, have Good unique Matt. I’ll couple that a was, regards, in quarter.

On side, wheel launches. was CCS We grew good steering EPS. high saw rate with core especially higher heat, the a and demand products, very and in increase our nice those significantly take for

plug of was battery heater. highest lot think us on EPS. fact, of the for quarter record a it And In the in quarter. ups with And in of series BMW the the the we launched hybrid that’s I ramp course, with then Jeep X

to of a factors. market. two momentum compared good lot there are So Headwind wise

tough pretty the a kind cop. which included third you one of lot the outperformance is The it quarter. launches, spike quarter, a back new typically at beginning at a we launch. of had XX That XXXX point of versus percentage actually was a look bring XXXX if so first third quarter

of we And a to non happened base. which built a where little there saw result years in difficult. comparison was just a and a in kind then a were into So there some the and revenue our business bundle take of non electronics cost shipments customers overall in margin That’s made we you around in out that. that’s conscious look activity that which that some XXXX. decision were back, back the outperformed acquisition electronics, quarter, just withheld is bit as automotive if the revenue start customers second and also And that of during several automotive of customer inflationary the a points, automotive then customers, is Tech phasing that mentioned, the factor XXX We recovery some meaningful low and basis one out Matteo unique have basis decline at result that than within electronics that Actually, quarter of points of products on mix, alone. would we negotiations. XXX rather have

breakdown So it. that’s for the

Matthew Koranda

one And a from can maybe front, out then the margin the some gross because think if basis, all year-over-year takes of then wondered of material puts lower the a wage just I Matteo impacted. maybe the just disaggregate bit he margin front, on within buyers on and freight, you FX gross and margin gross called kind quarter on on

gross I sort headwinds sense us price you of wondering model for of help to just margin so how side and forward. least much did on So going you margins? better those of guess negative can if maybe to relative on the you sizing a good then volume And get can how kind gross give

Matteo Anversa

good hi, Sure morning. Matt

me take that. let So

XXX So all, was the margin about in of gross quarter the think the acquisitions I of dilutive rates the on points. basis first impact

really by from see on XX% normalize to you a a basis. if you that, decline XX.X% So comparable year-over-year

wage bips. about was to Korean and basis compared then the And depreciation me the points higher freight the about in So regular it’s driven of the Then the and points. the let about was to due start primarily pressures inflation. XXX the XX effects And about -- U.S. another with material dollars XXX bips. was by XXX basis one impact Euro

negative were primary these the So drivers.

last we one. On from price bigger the pretty that pleased then things about are earnings of customers talk started that in the to was positive you the call. volume And positive how impact the side, on see the recoveries are we also And progressing. the

So breakdown. that’s kind the of

Matthew Koranda

just whole then looks it the for not And has a last lot one like outlook, changed. me on

margin. notice it too that Although in digit that you margins did I bring from one bit looks like EBITDA down did low acquisitions, little a the single EBITDA

sort could on little if will wondered Just color for what that seeing and you’re give front a leave I others. more bit on you it of

Phillip Eyler

Yes.

months business what if look thinking organic last were earnings say So would call. better I we than we three of that back ago, the a about were expected little performed the that I

quarter. we the actually half and recall, you for were in at legacy the EBITDA closed organic business about expecting be XX.X the about at If second to Gentherm XX%

the little So and Alfmeier. I maybe were the on also a basis discrete side. in of will with the a manufacturing expecting a primary are say quarter. drag can primarily the that had in XX And quickly continue of created about quarter, And working talk the better. the about that organic that little quarter fourth we We worse the business through which couple through the was in items we to And points a we’re team. in acquisitions occurred

to the compensation in And overall if is that of market plus what the from we adjust EBITDA month achieve currently deliver of revenue XX% adjustment really is of to So really expected we with But one that mentioned bit the in margin we guidance the a hit did happening. forecasting about the to are or more IHS that revenue fourth S&P third, the our need what coming that’s in in amount quarter. remarks my prepared two extra a in compared the the for fourth little the acquisitions. quarter, quarter our in midpoint line for little fourth margin, which I pessimistic similar about, on third, our then year-to-date performance, OPEX you incentive to in above conservative, annual given maybe Global is order dynamic is the which

of for that’s we year. So are remainder the the it how seeing

Matthew Koranda

the any is you color more manufacturing that Maybe what just specifically issue kind of I’ve share Alfmeier on of on just that can us? sort mentioned, with up that you follow

Matteo Anversa

that I’ll of at when first you Sure, it been these of in one. business look think Well, jump pretty core effects that short would the withstanding Alfmeier some on term all, have what of generation, there the ramp short valve is some next for But up example pneumatic close expected. the product are term there. to SMA issues. that we set definitely One the of I

We’re technologies, valve tend the all sight good And as of out middle what pretty that ramp right, up. the the launching couple get through. new of we’re be But costs of typical a new future upfront of kind for controls that’s products. And the a those line over that quarters. that’s content And to next ramp high. worked working to ups

Operator

the Luke line The next Please ahead. go from comes question Baird. Junk with of

Luke Junk

are integration is see that jointly already booked? customers And to this between real customers Thanks two looking came the start two first you that Is signals and me it on with about parts in the of you speak just August. is joint couple thermal closing this what for about just second one other this and Or question that pneumatic having of case starting for questions are I’m wondering, Can speed have how products are conversations state contemplating? are a when products first of this at you the two pneumatic? together with just had conversation at a a then the taking thermal or Alfmeier and question the of being integration overall?

Phillip Eyler

lot out the we OEM the very were other lot There But with Yes, bundle can to opportunity together immediately, where integrate consistent award. who is have that little seeing same mean, more at do packages of sense a supplier announcements, was good first were It you two the Luke. with customers. can effectively. you by and makes we’re I when a because looked what have, Hi to now time. a the timing things, the made bit can one at came that that that. interest on of these And

handle combining than in I say, bundling. more from of with So can you we the these customers, and honest both almost be would products, interest terms to

lot So But OEMs. for is of up cost the a from make bundling more there products how technology a especially for factor and But effective of from performance a on but standpoint. and purchasing that combined we do consumer interest also standpoint. the end the efficient there’s

little So going term, example, those sense technologies. on a we’re are And, integration of lot potential bit of the makes are two longer an as to work a to combine in electronics literal of cases, because with that opportunities these physical awards customers there course But those is product with see forward. product. pneumatic kind of going the to idea thermal time. little the are put Those certainly a bundling of more together take this the to we bit going product something

Luke Junk

are if might what expectation look recovery extent as margin still understand to in that bigger that of was recovery Alfmeier helpful. wondering and the What first And we super that your not So the from the looks you margin those either you. in second question, just zoom component , coming as Thank the fourth what one, we out how to that. the which and today, in or look you recoveries sense total for Phil to the in is for quarter con quarter margin Matteo terms. But in relative my progress beyond then XX,XXX better might this Thank and just third to feet to out is about make conversations? absolute want be what’s in just quarter the this is gross right I’m and cost now? of course,

Phillip Eyler

part. with the first So start me let

the by the due chain now driven which is to I’m experienced what is supply disruptions. quarter legacy, $XX in that shut overall, So of Luke The third lost and talking this right revenue we us we majority of million had about incremental from buys, X down the then to net due million independent incremental, freight the to [indiscernible]. spot see form premium we goods continue of recoveries. And freight, cost that quarter of normal shortages that sold in in cost an are customers about of

negative your So impact compared for quarters, the recoveries. in we’re the about margin, the these normal is the more we supply question really with doing to of is second on also, part chain the said, team have a seeing. on the adjust Overall the to the still Things part of costs. recover Through still wage are you really fourth we are in in basis the work we little due type material, second, quarter, similar that and better And when the points, still prior of incurring I’m our about you the freight. of dynamics talking pleased the the evasions the old that recovery the really systemic performance are here, that, what gross to the XXX to price.

Let’s spot the aside set price.

holistic recall, an may rate onetime ways. recover really higher about after the is spot price, one, it freight of we than had in went We you which four to different reimbursement quarter Number or were able XX%. As were which approach. and in the We a what prior in quarters. exponential actually we the took cost little

But pictures, times, really to as you again, obviously negotiation prices we the with offset freight with customer with margins. And established the price the to our pleased a inflation. delay, lower was terms in partner until to the order also last process bit we and to to the back So the then side the and try really recoveries of little our material several are better that. the negotiated that in appropriate on is a to recoveries. paying think is higher or increases And full And reduction better OEMs other form strategy awards, new avoid had the to of customers business price off. we know, then go of and we our get the and really achieving

to the in So those to expect about quarter. We of about XX% far, in remaining of and line XX% we half, pricing sight $XX negotiate increases. achieve would second fourth were million able negotiating we in have the the of

So I pleased progressing of team is the how recoveries. think we areas are the on in price

Operator

with The Please Seaport from next question Research Glenn Partners. go comes ahead. Chin

Glenn Chin

then of sort you just your in may and Thank customers you schedule issue terms I seeing folks. you. of them you a said think What chain that for out morning, upon leads issues, just etc? to and what related you you ask seeing I Good you’re some OEM comments you’re time, what conclude Phil, supply just volatility, expect production from expected that your there? to persist expand to

Phillip Eyler

definitely more stages improvement still volatile semiconductor even some we surprises the QX suppliers. well, in there. specific out while of Typically, and definitely Yes, seen early have just it’s darn up quarter, from pop seeing pretty in gradual that are we’re, improvements there

big from the less the just than much of that is is visibility challenges the in One getting we’re in past. suppliers the general

none between typically semiconductor five are of visibility. to firm We’re seeing eight suppliers the beyond that’s And it it willing commitment. weeks to that give somewhere call of

were continue just doing our second that to there shortfalls cases to possible. outside same of part that I an teams excellent the job window in But all in that, And to our of of We best best of not continue our time. did think our stay on we a expedite. the see of at where short But So causes suppliers keeping factories. to but allocation OEM the had of bit see, shipments properly. again, quite we we’re short. in the definitely flow and disruption to factories. had maintain window pretty try a to We in in to with the came front significant delivery promised all, level, readjust the Definitely level

even the to mostly get seeing, dynamics And get parts freight, big reimbursed. spending some when in volume the we’re And expedited couple try bit is seeing then out. And you aren’t we’re You get money overtime a are then then the this on a in lost to little within weeks, of typically back. time we’re producing. we of the still the comes it. more seeing productivity Those hustling and working which cases

that better Fortunately, don’t rate. me it’s right the end. tells little see anything now I a bit nearing we’re

So I think going watch have we’re it to really closely. to

agile a next We have think hopefully done this which in alleviate. I job And several at. quarters, good will the to we’ve be

Glenn Chin

business in those and conquest if know if know wins. if you’re us detail. Thank has about primary likewise, I one there you it’s I just at tell was change can environment for are the yesterday, new I your the Phil talking then acquired of all? the mean, all business. recently competitive And things just competitors some or I you don’t guess, don’t on business

share you us bigger? won just guys or tell gaining the quarter business. with they new gaining pie this share? are growing have You or or Can conquest booked you are Or

Phillip Eyler

I core point in rate we’ve win the this our one Yes, was important ever is highest us think that quarter for had among quarters business.

So is the we’re for market we us dynamics direct shaping OEMs. out really from customers our general, still excited terms the value source to about us that way opportunities. In kind of still same that, see in coming tells our and the product, of those they’re

the are are any tier said, been material manufacturer and that sourcing. are in one We and there seat customers haven’t there to for always certain change programs mix. have decision on the seen there That awarded the

opportunities product be so of a there certainly you competitor keep us, a more mix mentioned going in the to for probably And going to lot there’s house.

customer opportunities see remains them. for Lear us, an and Although important with we

in choose. momentum award Secondly, they we other actually see have ones when to tier from the increases opportunity

strengthening really relationship We’re with about our excited Allianz example. an as

with becoming collaboration preferred pneumatic. thermal and We’re both for partner a them

pretty that’s momentum. for And all good all, But so exciting seeing at we’re us.

Operator

sir. Yes from from next Craig-Hallum line Sigdahl the go the Group. take ahead. Please Ryan of question Capital We

Ryan Sigdahl

Good morning, guys.

one Just us. for

guess, technologies how So is are seems climate have especially pulling your play Thanks. kind sense. kind now, I of like expect advanced it we Two on better sense you to and really comfort, like? guess for one there talk we’ve lot out advanced years I of other on next of through but what’s for quarters through through OEM technology pipeline several the pneumatic the technologies EVs. models climate? seen, Why a pulling climate look thermal But

Glenn Chin

about them. obviously the obviously, we’ve there, to making the be General Thanks. more then in wind we sets. down Motors we’re the shot that. win and successful for and another market executing to get Celestiq climate pipeline, We at and we’re one with excited quite heads want we’re obviously on Sure. momentum got on go Well, first

is with customers. now that’s are other that So happening really right are to for There priority projects deliver development them. top our

And range. infrastructure an standard changes overall to integrate That lead and make said on about selective a the the from the I climate with equipment, both for battery importantly and very see pathway efficiency to changes gains results being where something they most those We’re consumer thermal but that, the them as to which we’re that’s think in you the vehicle, require big sense showing vehicle beneficial. these benefit. projects, make sure executing the thermal performance vehicle. have good time the is in they expected also design a and And are that long to standpoint to of the

so a up race OEM climate when that about companies you sense, and talk have know And are to right timing at you you pitch fever full EVs get to car with the the market. an match as with to the

time. where fall to those lots big right changes it. has get interest. the infrastructure There’s at So the People making of this go. They to definitely future has sometimes know is

it’s So going some take to time.

of on the side, In of new terms kind are technologies, technology effect sense a climate the lot other development. wins especially of those of thermal an our

heat it, just wheel able neck of climate sense solution, steering full sense or not putting some conditioning the elements the CCS seats. heat the penetration the and rear customers, of more effectors start they some or in show about excited climate to like but to We’re to get different different of

to line the falls for OEMs their wellness right and we and So and that which movement with of to all car a differentiator along we’re the through start lumbar at health comfort in more improving flow companies. have seeing pneumatic now huge the go passengers that time. massage towards of it, solutions, the is that obviously, more the And same with

Operator

session. As turn back further question our and there comments. this are to Phil you answer Eyler no for conference like closing would to sir. the questions, concludes to I Over

Phillip Eyler

Gentherm drive outperforming I’m revenue and delivering for continuing metrics, production Mobility team industry for record innovation Sure. extremely quarterly proud call. Thanks, groundbreaking Global a to our joining S&P challenging everyone global despite backdrop. of the

shared flow the very and cash past, consistently on execution, operational remain in I’ve we focused innovation As generation.

continued While of cost deliver changes progress. seeing significant you term. appreciate the line management your apprised that and near on forward over interest we value the and our top long our with wide the support market term, shareholder in we’re keeping expect We well coupled positions to us to look momentum stringent the

Operator

you. concluded. conference Thank Thank now has for you attending today’s The presentation.

You disconnect. may now

Gentherm (THRM) 2 Nov 222022 Q3 Earnings call transcript