2024 Q2 Form 10-Q Financial Statement

#000161686224000035 Filed on May 01, 2024

View on sec.gov

Income Statement

Concept 2024 Q2 2024 Q1
Revenue $1.351B $1.294B
YoY Change 4.41% 0.79%
Cost Of Revenue $891.0M $865.0M
YoY Change -1.48% -4.09%
Gross Profit $460.0M $429.0M
YoY Change 18.1% 12.3%
Gross Profit Margin 34.05% 33.15%
Selling, General & Admin $213.0M $207.0M
YoY Change 1.33% 0.49%
% of Gross Profit 46.3% 48.25%
Research & Development $18.00M $18.00M
YoY Change -3.23% -5.76%
% of Gross Profit 3.91% 4.2%
Depreciation & Amortization $31.00M $68.00M
YoY Change -53.17% -2.16%
% of Gross Profit 6.74% 15.85%
Operating Expenses $231.0M $308.0M
YoY Change 0.96% 36.83%
Operating Profit $205.0M $121.0M
YoY Change 48.98% -3.43%
Interest Expense -$53.00M -$59.00M
YoY Change -197.07% -222.41%
% of Operating Profit -25.85% -48.76%
Other Income/Expense, Net $1.000M $0.00
YoY Change -111.76% -100.0%
Pretax Income $156.0M $59.00M
YoY Change 109.4% -22.16%
Income Tax $43.00M $20.00M
% Of Pretax Income 27.56% 33.9%
Net Earnings $112.0M $41.00M
YoY Change 83.91% -32.23%
Net Earnings / Revenue 8.29% 3.17%
Basic Earnings Per Share $0.51 $0.18
Diluted Earnings Per Share $0.51 $0.19
COMMON SHARES
Basic Shares Outstanding 220.6M shares 220.1M shares
Diluted Shares Outstanding 220.9M shares 221.3M shares

Balance Sheet

Concept 2024 Q2 2024 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $840.0M $624.0M
YoY Change 62.29% 21.85%
Cash & Equivalents $840.0M $624.0M
Short-Term Investments
Other Short-Term Assets $124.0M $107.0M
YoY Change 37.17% 5.63%
Inventory $745.0M $751.0M
Prepaid Expenses
Receivables $1.054B $1.071B
Other Receivables $214.0M $207.0M
Total Short-Term Assets $3.014B $2.760B
YoY Change 12.06% 5.19%
LONG-TERM ASSETS
Property, Plant & Equipment $1.158B $1.174B
YoY Change -3.24% -2.49%
Goodwill $1.549B $1.554B
YoY Change 1.47% 2.0%
Intangibles $1.061B $1.087B
YoY Change -1.49% -0.59%
Long-Term Investments
YoY Change
Other Assets $524.0M $514.0M
YoY Change -5.24% -7.5%
Total Long-Term Assets $4.292B $4.329B
YoY Change -1.41% -1.09%
TOTAL ASSETS
Total Short-Term Assets $3.014B $2.760B
Total Long-Term Assets $4.292B $4.329B
Total Assets $7.306B $7.089B
YoY Change 3.73% 1.26%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $715.0M $721.0M
YoY Change 1.81% 2.49%
Accrued Expenses $600.0M $591.0M
YoY Change 2.06% 10.55%
Deferred Revenue
YoY Change
Short-Term Debt $3.000M $3.000M
YoY Change -84.21% -86.11%
Long-Term Debt Due $17.00M $17.00M
YoY Change -15.0% -15.0%
Total Short-Term Liabilities $1.335B $1.332B
YoY Change 0.44% 4.09%
LONG-TERM LIABILITIES
Long-Term Debt $3.588B $3.407B
YoY Change 1.67% -5.51%
Other Long-Term Liabilities $177.0M $420.0M
YoY Change 34.91% 224.32%
Total Long-Term Liabilities $177.0M $3.827B
YoY Change 34.91% 2855.21%
TOTAL LIABILITIES
Total Short-Term Liabilities $1.335B $1.332B
Total Long-Term Liabilities $177.0M $3.827B
Total Liabilities $5.488B $5.358B
YoY Change 2.5% -0.51%
SHAREHOLDERS EQUITY
Retained Earnings $1.439B $1.327B
YoY Change 26.21% 22.95%
Common Stock $1.838B $1.829B
YoY Change 1.49% 1.58%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $1.773B $1.731B
YoY Change
Total Liabilities & Shareholders Equity $7.306B $7.089B
YoY Change 3.73% 1.26%

Cashflow Statement

Concept 2024 Q2 2024 Q1
OPERATING ACTIVITIES
Net Income $112.0M $41.00M
YoY Change 83.91% -32.23%
Depreciation, Depletion And Amortization $31.00M $68.00M
YoY Change -53.17% -2.16%
Cash From Operating Activities $114.0M $34.00M
YoY Change -12.98% -165.64%
INVESTING ACTIVITIES
Capital Expenditures $23.00M $22.00M
YoY Change -29.23% -46.86%
Acquisitions
YoY Change
Other Investing Activities $6.000M $3.000M
YoY Change 500.0% -433.33%
Cash From Investing Activities -$17.00M -$19.00M
YoY Change -46.03% 245.45%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net $183.0M
YoY Change 141.42%
Cash From Financing Activities 130.0M -82.00M
YoY Change -243.17% -7.24%
NET CHANGE
Cash From Operating Activities 114.0M 34.00M
Cash From Investing Activities -17.00M -19.00M
Cash From Financing Activities 130.0M -82.00M
Net Change In Cash 227.0M -67.00M
YoY Change 2509.2% -54.02%
FREE CASH FLOW
Cash From Operating Activities $114.0M $34.00M
Capital Expenditures $23.00M $22.00M
Free Cash Flow $91.00M $12.00M
YoY Change -7.61% -112.88%

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES<div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The interim condensed consolidated financial statements included herein are unaudited. In the opinion of management, these statements include all adjustments, consisting only of normal, recurring adjustments, necessary for a fair statement of the financial position and shareholders' equity of Axalta Coating Systems Ltd., a Bermuda exempted company limited by shares, and its consolidated subsidiaries ("Axalta," the "Company," "we," "our" and "us") at March 31, 2024, the results of operations, comprehensive (loss) income, changes in shareholders' equity and cash flows for the three months ended March 31, 2024 and 2023. All intercompany balances and transactions have been eliminated. </span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">These interim unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America ("GAAP").</span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The interim unaudited condensed consolidated financial statements include the accounts of Axalta and its subsidiaries, and entities in which a controlling interest is maintained. Certain of our entities are accounted for on a one-month lag basis, the effect of which is not material.</span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In the current year, we changed the presentation in our condensed consolidated financial statements to whole millions from our historical presentation of tenths of millions and, as a result, any necessary rounding adjustments have been made to prior year disclosed amounts.</span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full year ended December 31, 2024 or any future period(s).</span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Summary of Significant Accounting Policies Updates</span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Recently Adopted Accounting Guidance</span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In January 2023, we adopted Accounting Standards Update ("ASU") 2022-04, </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:120%">Liabilities – Supplier Finance Programs</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">, which codifies disclosure requirements for supplier financing programs. This ASU does not affect the recognition, measurement or financial statement presentation of obligations covered by supplier finance programs. Upon adoption of this ASU, we incorporated the required disclosures in Note 14. In addition to the disclosures included in Note 14, ASU 2022-04 requires a rollforward of activity for each supplier financing program beginning with annual reporting for the year ended December 31, 2024, at which time we will incorporate the required rollforward disclosure.</span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Accounting Guidance and Disclosure Rules Issued But Not Yet Adopted</span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In November 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023-07,</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:120%"> Segment Reporting (Topic 280),</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%"> to expand the disclosures about a public entity's reportable segments and address requests from investors for additional, more detailed information about a reportable segment's expenses. The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. We are currently evaluating the impact of ASU 2023-07 on our financial statements.</span></div><div style="margin-bottom:6pt;margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In December 2023, the FASB issued ASU 2023-09, </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:120%">Income Taxes (Topic 740), </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">to enhance the transparency and decision usefulness of income tax disclosures, primarily related to the rate reconciliation and income taxes paid disclosures. The new standard is effective for fiscal years beginning after December 15, 2024. We are currently evaluating the impact of ASU 2023-09 on our financial statements.</span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">In March 2024, the Securities and Exchange Commission ("SEC") adopted final rules under SEC Release No. 34-99678 and No. 33-11275 (the "Final Rules"), </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:112%">The Enhancement and Standardization of Climate-Related Disclosures for Investors</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">, which will require registrants to provide certain climate-related information in their registration statements and annual reports. The Final Rules require, among other things, disclosures in the notes to the audited financial statements relating to the effects of severe weather events and other natural conditions, subject to certain thresholds, as well as amounts related to carbon offsets and renewable energy credits or certificates in certain circumstances. The financial statement disclosure requirements of the Final Rules are effective for fiscal years beginning in 2025. In April 2024, the SEC stayed the effectiveness of the Final Rules. We are currently evaluating the impact of the Final Rules.</span></div>
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