Adient Reports Mixed Q2, Reaffirms FY23 Guidance, Cautious On Unfavorable Macro Factors

Adient PLC ADNT reported second-quarter FY23 sales growth of 12% Y/Y to $3.91 billion, beating the consensus of $3.76 billion.
Revenues benefitted from higher volumes and slight commercial recoveries in the quarter.
Gross profit increased to $250 million from $175 million a year ago.
Adjusted EBITDA improved 35% Y/Y to $215 million with a margin of 5.5% versus 4.5% a year ago.
The company held $826 million in cash and equivalents and operating cash flow for the quarter amounted to $170 million as of March 31, 2023. Net debt of Adient totaled $1.7 billion.
Adjusted EPS of $0.32 missed the analyst consensus of $0.43.
2023 Outlook Reiterated: Adient saw FY23 sales of about $15 billion versus the consensus of $15.09 billion and adjusted EBITDA of $850 million.
The company expects growth momentum to continue in H2 FY23 but is cautious due to weak vehicle demand in China and higher steel prices in North America.
Adient expects to generate around $215 million ($200 million prior) of FCF.
ADNR Price Action: Adient shares are trading lower by 6.49% at $34.75 Wednesday at publication.