2024 Q1 Form 10-K Financial Statement

#000173570724000012 Filed on February 15, 2024

View on sec.gov

Income Statement

Concept 2024 Q1 2023 Q4 2023
Revenue $915.0M $945.0M $3.886B
YoY Change -5.67% 5.23% 7.85%
Cost Of Revenue $743.0M $756.0M $3.130B
YoY Change -4.87% 2.58% 7.19%
Gross Profit $172.0M $189.0M $756.0M
YoY Change -8.99% 17.39% 10.69%
Gross Profit Margin 18.8% 20.0% 19.45%
Selling, General & Admin $64.00M $69.00M $247.0M
YoY Change 14.29% 32.69% 14.35%
% of Gross Profit 37.21% 36.51% 32.67%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $22.00M $24.00M $90.00M
YoY Change 4.76% 20.0% 7.14%
% of Gross Profit 12.79% 12.7% 11.9%
Operating Expenses $65.00M $71.00M $247.0M
YoY Change 16.07% 36.54% 14.35%
Operating Profit $107.0M $118.0M $509.0M
YoY Change -19.55% 8.26% 8.99%
Interest Expense -$31.00M -$51.00M $159.0M
YoY Change -210.71% 112.5% 93.9%
% of Operating Profit -28.97% -43.22% 31.24%
Other Income/Expense, Net $5.000M $1.000M $2.000M
YoY Change 25.0% -98.04% -98.35%
Pretax Income $81.00M $68.00M $347.0M
YoY Change -25.0% -49.63% -30.04%
Income Tax $15.00M $16.00M $86.00M
% Of Pretax Income 18.52% 23.53% 24.78%
Net Earnings $66.00M $52.00M $261.0M
YoY Change -18.52% -53.57% -33.08%
Net Earnings / Revenue 7.21% 5.5% 6.72%
Basic Earnings Per Share $0.28 $0.22 -$0.31
Diluted Earnings Per Share $0.28 $0.22 -$0.31
COMMON SHARES
Basic Shares Outstanding 238.3M shares 242.4M shares 166.6M shares
Diluted Shares Outstanding 239.0M shares 166.6M shares

Balance Sheet

Concept 2024 Q1 2023 Q4 2023
SHORT-TERM ASSETS
Cash & Short-Term Investments $196.0M $259.0M $259.0M
YoY Change -32.65% 5.28% 5.28%
Cash & Equivalents $196.0M $259.0M $259.0M
Short-Term Investments
Other Short-Term Assets $83.00M $75.00M $58.00M
YoY Change -33.06% -31.82% -42.0%
Inventory $272.0M $263.0M $263.0M
Prepaid Expenses $15.00M
Receivables $616.0M $608.0M $608.0M
Other Receivables $171.0M $200.0M $218.0M
Total Short-Term Assets $1.338B $1.406B $1.406B
YoY Change -16.64% -1.75% -1.75%
LONG-TERM ASSETS
Property, Plant & Equipment $495.0M $477.0M $517.0M
YoY Change 7.14% 1.49% 0.58%
Goodwill $193.0M $193.0M
YoY Change 0.0% 0.0%
Intangibles
YoY Change
Long-Term Investments $30.00M $29.00M $29.00M
YoY Change -6.25% -3.33% -3.33%
Other Assets $372.0M $206.0M $362.0M
YoY Change 43.63% -26.69% -19.02%
Total Long-Term Assets $1.110B $1.121B $1.121B
YoY Change -6.41% -7.05% -7.05%
TOTAL ASSETS
Total Short-Term Assets $1.338B $1.406B $1.406B
Total Long-Term Assets $1.110B $1.121B $1.121B
Total Assets $2.448B $2.527B $2.527B
YoY Change -12.29% -4.17% -4.17%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $1.029B $1.074B $1.074B
YoY Change -8.37% 2.48% 2.48%
Accrued Expenses $219.0M $293.0M $225.0M
YoY Change -37.07% -8.44% 11.39%
Deferred Revenue $10.00M $9.000M
YoY Change 0.0% 12.5%
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $7.000M $7.000M $7.000M
YoY Change 0.0% 0.0% 0.0%
Total Short-Term Liabilities $1.319B $1.374B $1.374B
YoY Change -10.76% -0.07% -0.07%
LONG-TERM LIABILITIES
Long-Term Debt $1.633B $1.643B $1.643B
YoY Change 41.14% 43.12% 43.12%
Other Long-Term Liabilities $201.0M $218.0M $218.0M
YoY Change -3.37% 6.34% 6.34%
Total Long-Term Liabilities $1.834B $1.861B $1.861B
YoY Change 34.36% 37.55% 37.55%
TOTAL LIABILITIES
Total Short-Term Liabilities $1.319B $1.374B $1.374B
Total Long-Term Liabilities $1.834B $1.861B $1.861B
Total Liabilities $3.183B $3.262B $3.262B
YoY Change 10.87% 18.49% 18.49%
SHAREHOLDERS EQUITY
Retained Earnings -$1.856B -$1.922B
YoY Change 28.35% 29.43%
Common Stock $0.00 $0.00
YoY Change
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity -$735.0M -$735.0M -$735.0M
YoY Change
Total Liabilities & Shareholders Equity $2.448B $2.527B $2.527B
YoY Change -12.29% -4.17% -4.17%

Cashflow Statement

Concept 2024 Q1 2023 Q4 2023
OPERATING ACTIVITIES
Net Income $66.00M $52.00M $261.0M
YoY Change -18.52% -53.57% -33.08%
Depreciation, Depletion And Amortization $22.00M $24.00M $90.00M
YoY Change 4.76% 20.0% 7.14%
Cash From Operating Activities $84.00M $135.0M $465.0M
YoY Change -8.7% -1.46% 24.0%
INVESTING ACTIVITIES
Capital Expenditures $32.00M $26.00M $83.00M
YoY Change 300.0% 100.0% -8.79%
Acquisitions
YoY Change
Other Investing Activities $4.000M $19.00M $28.00M
YoY Change
Cash From Investing Activities -$28.00M -$7.000M -$55.00M
YoY Change 250.0% -46.15% -39.56%
FINANCING ACTIVITIES
Cash Dividend Paid $0.00 $42.00M
YoY Change -100.0% -49.4%
Common Stock Issuance & Retirement, Net $213.0M
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -112.0M -37.00M -$403.0M
YoY Change 154.55% -19.57% -16.39%
NET CHANGE
Cash From Operating Activities 84.00M 135.0M $465.0M
Cash From Investing Activities -28.00M -7.000M -$55.00M
Cash From Financing Activities -112.0M -37.00M -$403.0M
Net Change In Cash -56.00M 91.00M $12.00M
YoY Change -227.27% 16.67% -105.56%
FREE CASH FLOW
Cash From Operating Activities $84.00M $135.0M $465.0M
Capital Expenditures $32.00M $26.00M $83.00M
Free Cash Flow $52.00M $109.0M $382.0M
YoY Change -38.1% -12.1% 34.51%

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<div style="margin-top:10pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Note 1. Background and Basis of Presentation</span></div><div style="margin-top:10pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Background</span></div><div style="text-align:justify;text-indent:21.6pt"><span><br/></span></div><div style="text-align:justify;text-indent:21.6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Garrett Motion Inc. (the "Company" or "Garrett") is a cutting-edge technology leader delivering differentiated solutions for emission reduction and energy efficiency. We design, manufacture and sell highly engineered turbocharging, air and fluid compression, and high-speed electric motor technologies for OEMs and distributors within the mobility and industrial space. We have significant expertise in delivering products at scale for ICE using gasoline, diesel, natural gas and hydrogen, as well as for zero emission technologies using hydrogen fuel cell systems, both for mobility and industrial use. As our customers continue to progress on electrification, we are applying our technological pillars to develop highly engineered E-Powertrain and E-Cooling compressor products to support their ambition. These products are key enablers for fuel economy, energy efficiency, thermal management, and compliance with emissions standards and overall greenhouse gas and other emission reduction targets.</span></div><div style="margin-top:10pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Basis of Presentation</span></div><div style="text-align:justify;text-indent:21.6pt"><span><br/></span></div><div style="text-align:justify;text-indent:21.6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All amounts presented are in millions, except per share amounts. </span></div><div style="margin-top:10pt;text-align:justify;text-indent:21.6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We evaluate segment reporting in accordance with ASC 280, </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</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">. We concluded that Garrett operates in a single operating segment and a single reportable segment based on the operating results available and evaluated regularly by the chief operating decision maker (“CODM”), who is our Chief Executive Officer, to make decisions about resource allocation and performance assessment. The CODM makes operational performance assessments and resource allocation decisions on a consolidated basis, inclusive of all of the Company’s products across channels and geographies.</span></div><div style="text-align:justify;text-indent:21.6pt"><span><br/></span></div><div style="text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:112%">Capital Structure Transformation Transaction</span></div><div style="margin-top:10pt;text-align:justify;text-indent:21.6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">On April 12, 2023, the Company entered into the Transaction (as defined in Note 21, </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:120%">Equity</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">) to increase the attractiveness of the Company to investors, including simplifying the Company’s capital stock by converting all outstanding Series A Preferred Stock into a single class of Common Stock, subject to certain conditions.</span></div><div style="margin-top:10pt;text-align:justify;text-indent:21.6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">As part of the Transaction, the Company repurchased an aggregate of 69,707,719 shares of Series A Preferred Stock from the C&amp;O Investors (as defined below), and converted all remaining outstanding 175,337,712 shares of Series A Preferred Stock into an equivalent number of shares of Common Stock. The total amounts paid to holders of Series A Preferred Stock in connection with the Transaction included aggregate cash payments of $605 million and the issuance of an additional 25,577,517 shares of Common Stock in settlement of accumulated and unpaid preference dividends on the Series A Preferred Stock through June 30, 2023. The Transaction was financed through a new Term Loan B for an aggregate principal amount of $700 million under the framework of the Company's existing credit agreement. See Note 21, </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:120%">Equity</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">.</span></div><div style="margin-top:10pt;text-align:justify;text-indent:21.6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The Company recorded the following amounts in the Consolidated Financial Statements related to the repurchase and conversion of its Series A Preferred Stock:</span></div><div style="text-align:justify"><table style="border-collapse:collapse;display:inline-table;margin-bottom:5pt;vertical-align:text-bottom;width:100.000%"><tr><td style="width:1.0%"></td><td style="width:82.081%"></td><td style="width:0.1%"></td><td style="width:0.1%"></td><td style="width:0.406%"></td><td style="width:0.1%"></td><td style="width:1.0%"></td><td style="width:15.113%"></td><td style="width:0.1%"></td></tr><tr><td colspan="3" style="padding:0 1pt"></td><td colspan="3" style="padding:0 1pt"></td><td colspan="3" style="padding:2px 1pt;text-align:center;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:8pt;font-weight:700;line-height:100%">Movements for the Year Ended </span></td></tr><tr><td colspan="3" style="padding:0 1pt"></td><td colspan="3" style="padding:0 1pt"></td><td colspan="3" style="padding:2px 1pt;text-align:center;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:8pt;font-weight:700;line-height:100%">December 31, 2023</span></td></tr><tr><td colspan="3" style="background-color:#cceeff;padding:2px 1pt;text-align:left;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:100%">Consolidated Balance Sheet:</span></td><td colspan="3" style="background-color:#cceeff;padding:0 1pt"></td><td colspan="3" style="background-color:#cceeff;border-top:1pt solid #000;padding:2px 1pt;text-align:center;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:8pt;font-style:italic;font-weight:400;line-height:100%">(Dollars in millions)</span></td></tr><tr><td colspan="3" style="background-color:#ffffff;padding:2px 1pt 2px 19pt;text-align:left;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:115%">Cash and cash equivalents</span></td><td colspan="3" style="background-color:#ffffff;padding:0 1pt"></td><td style="background-color:#ffffff;padding:2px 0 2px 1pt;text-align:left;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:115%">$</span></td><td style="background-color:#ffffff;padding:2px 0;text-align:right;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:115%">(605)</span></td><td style="background-color:#ffffff;padding:2px 1pt 2px 0;text-align:right;vertical-align:bottom"></td></tr><tr><td colspan="3" style="background-color:#cceeff;padding:2px 1pt 2px 19pt;text-align:left;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:115%">Preferred stock, Common stock and Additional Paid-in capital</span></td><td colspan="3" style="background-color:#cceeff;padding:0 1pt"></td><td colspan="2" style="background-color:#cceeff;padding:2px 0 2px 1pt;text-align:right;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:100%">(157)</span></td><td style="background-color:#cceeff;padding:2px 1pt 2px 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style="background-color:#ffffff;padding:0 1pt"></td><td colspan="3" style="background-color:#ffffff;padding:0 1pt"></td><td colspan="3" style="background-color:#ffffff;padding:2px 1pt;text-align:center;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:8pt;font-weight:700;line-height:115%">Year Ended<br/>December 31, 2023</span></td></tr><tr><td colspan="3" style="background-color:#cceeff;padding:2px 1pt;text-align:left;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:100%">Consolidated Statement of Operations:</span></td><td colspan="3" style="background-color:#cceeff;padding:0 1pt"></td><td colspan="3" style="background-color:#cceeff;border-top:1pt solid #000;padding:2px 1pt;text-align:center;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:8pt;font-style:italic;font-weight:400;line-height:100%">(Dollars in millions)</span></td></tr><tr><td colspan="3" style="display:none"></td><td colspan="3" style="display:none"></td><td colspan="3" style="display:none"></td></tr><tr><td colspan="3" style="background-color:#ffffff;padding:2px 1pt 2px 19pt;text-align:left;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:115%">Non-operating expenses</span></td><td colspan="3" style="background-color:#ffffff;padding:0 1pt"></td><td style="background-color:#ffffff;padding:2px 0 2px 1pt;text-align:left;vertical-align:bottom"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:100%">$</span></td><td style="background-color:#ffffff;padding:2px 0;text-align:right;vertical-align:bottom"><span style="color:#000000;font-family:'Times New 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