Gentherm (THRM) Tops Q4 EPS by 3c, Beats on Revenues; FY18 Revenue Outlook In-Line with Estimates

February 20, 2018 6:12 AM EST
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Price: $67.97 -1.44%

EPS Growth %: +103.9%

Financial Fact:
Net loss: 644K

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Gentherm (NASDAQ: THRM) reported Q4 EPS of $0.55, $0.03 better than the analyst estimate of $0.52. Revenue for the quarter came in at $257.2 million versus the consensus estimate of $250.87 million.

Fourth Quarter Highlights

  • Record product revenues of $257.2 million increased 8.7% from $236.5 million in the 2016 fourth quarter. Product revenues on a comparable basis, excluding the impact of acquisitions and foreign currency translation, rose 4.1% year over year
  • Added $8.4 million in revenue associated with acquisition of Etratech
  • Operating profit of $21.1 million as compared with $26.5 million in the 2016 fourth quarter, largely reflective of increased investment in research and development to drive accelerated revenue growth and CEO transition expenses (“Transition Expenses”)
  • Earnings per share was $(0.14) as compared with $0.71 for the prior-year period
  • Adjusted earnings per share, excluding $0.55 per share of expense related to U.S. tax reform and $0.07 per share related to the Transition Expenses, as well as other items (see table herein), was $0.61. Adjusted earnings per share in the prior-year period was $0.68

Guidance

With the recent transition to a new Chief Executive Officer, the Company is undertaking a detailed review of its strategic plan and opportunities to accelerate revenue and earnings growth. The Company anticipates that, over the course of the next few months, the management team and the Company’s Board of Directors will collectively determine a new strategic plan. In the interim, the Company provided the following guidance for 2018:

  • Product revenue is expected to grow between 8% and 10% to a range of $1.06 billion to $1.08 billion, reflecting 3% to 5% organic growth and the full-year contribution from Etratech, which was acquired in November 2017
  • Gross margin rate is expected to be between 30% and 32%
  • Adjusted EBITDA is expected to be approximately 15% of product revenue
  • Capital expenditures are expected to be approximately $50 million

Due to the inherent difficulty of forecasting the timing and amount of certain items that would impact net income, such as foreign currency gains and losses, we are unable to reasonably estimate net income, the GAAP financial measure most directly comparable to Adjusted EBITDA. Accordingly, we are unable to provide a reconciliation of Adjusted EBITDA to net income with respect to the guidance provided.

GUIDANCE:

Gentherm sees FY2018 revenue of $1.06-1.08 billion, versus the consensus of $1.07 billion.

For earnings history and earnings-related data on Gentherm (THRM) click here.



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