Axalta Q1 2021 Earnings Report
Key Takeaways
Axalta Coating Systems reported an 8.1% year-over-year increase in net sales to $1,063.6 million for Q1 2021, driven by positive contributions from all end-markets. Adjusted EBIT increased 37.8% to $182.8 million, a record for first quarter results. Diluted EPS was $0.06, while adjusted diluted EPS reached $0.50. The company acquired Anhui Shengran Insulating Materials Co. Ltd. and repurchased $63.6 million of stock during the quarter.
Q1 2021 net sales increased 8.1% year-over-year to $1,063.6 million with positive contributions from all end-markets
Adjusted EBIT increased 37.8% to $182.8 million, a record for first quarter results
Diluted EPS of $0.06 versus $0.22 in Q1 2020; Adjusted diluted EPS of $0.50 versus $0.31 in Q1 2020
Repurchased $63.6 million of stock during Q1 2021 at an average price of $27.94
Axalta
Axalta
Forward Guidance
Axalta provided full year 2021 financial guidance with net sales expected to increase by approximately 20-22%, including benefits from foreign exchange and M&A. Adjusted EBIT is projected to be between $715-755 million, and adjusted diluted EPS is expected to be $1.95 - 2.10. Free cash flow is estimated at $455-495 million, inclusive of $180 million in capital expenditures.
Positive Outlook
- Steady demand improvement sequentially in Refinish expected in the coming quarters.
- Largely stable and growing net sales from other businesses during the balance of the year.
- Anticipate ongoing deployment of capital to both M&A as well as share repurchases during the rest of 2021.
- Expect to work hard to pass on most of the input inflation through price increases.
- Board recently approved a $625 million increase in share repurchase program.
Challenges Ahead
- Some delay in sales from Q2 is expected in Mobility due to supply chain disruption and customer component shortages.
- Rising input inflation effects beginning in the second quarter.
- Some headwind from lower year-over-year temporary cost savings.
- Semiconductor chip shortage impact on Light Vehicle to continue throughout Q2.
- Constrained supply chain impact persists in early Q2 on Industrial volumes