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Monday, 26 October 2020 16:08

Axalta Releases Third Quarter 2020 Results

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Axalta Coating Systems Ltd., a leading global coatings company, announced its financial results for the third quarter ended Sept. 30.

Third quarter net sales of $1,026.9 million decreased 7.2% year-over-year, including a 0.1% foreign currency benefit, driven by 6.0% lower volumes and 1.4% lower average price and product mix.

 

Lower volumes across all end-markets were driven by ongoing COVID-19 related macroeconomic impacts, though volumes improved considerably through the quarter and exceeded earlier expectations due to faster recovery pacing in key end-markets.

 

Performance Coatings recorded a 5.7% net sales decline, including nearly flat Industrial net sales versus the prior year quarter, while the Refinish net sales decline of 9% showed strong recovery ahead of expectations. The 10.2% net sales decline for Transportation Coatings benefited from faster than expected recovery in Light Vehicle production, most notably in North America and China.

 

Axalta posted 1.4% headwinds in year-over-year price and product mix, still impacted by abnormal product mix given substantial product and geographic mix differences from the prior year given overall volume declines.    
     
Income from operations for Q3 2020 totaled $141.7 million versus $123 million in Q3 2019. Net income to common shareholders was $82.5 million for the quarter compared with $65.5 million in Q3 2019, and diluted earnings per share was $0.35 compared with $0.28 in Q3 2019.

 

The increases were primarily driven by lower operating expenses inclusive of cost actions taken this year in response to COVID-19 and favorable variable input costs, offset partly by lower global net sales across all end-markets. 

 

Additionally, income from operations was negatively impacted by termination charges of $35.7 million associated with our recently announced restructuring plan which compares to a $29.2 million charge in Q3 2019.

 

Adjusted EBIT of $210.4 million for the third quarter compared with $191.2 million in Q3 2019. Adjusted diluted EPS of $0.59 compared with $0.52 in Q3 2019. These results were driven by lower operating expenses inclusive of cost actions initiated in response to COVID-19 and lower variable input costs, partly offset by lower global net sales across all end-markets.


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