Sensata Technologies Reports Fourth Quarter and Full Year 2024 Financial Results

SWINDON, United Kingdom–(BUSINESS WIRE)–Sensata Technologies (NYSE: ST), a global industrial technology company and leading provider of sensors, sensor-rich solutions, and electrical protection devices used in mission-critical systems to help its customers address increasingly complex engineering and operating performance requirements, today announced financial results for its fourth quarter and full year ended December 31, 2024.

“Sensata had a strong finish to the year with fourth quarter revenue exceeding expectations, full year free cash flow increasing by over 40% compared to prior year, and adjusted operating margin increasing for the fourth consecutive quarter,” said Stephan von Schuckmann, Sensata’s Chief Executive Officer. “I believe that there is a significant opportunity to create shareholder value by returning Sensata, over time, to growth, driving operational excellence, and efficiently deploying capital. Our high value and differentiated margin businesses, strong global engineering footprint, and deep, long-lasting customer relationships provide us an excellent foundation on which to build for future success.”

Operating Results – Fourth Quarter

Operating results for the fourth quarter of 2024 compared to the fourth quarter of 2023 are summarized below. These results include non-GAAP financial measures, each of which is defined and reconciled to the most directly comparable GAAP measure later in this press release.

Revenue:

• Revenue was $907.7 million, a decrease of $84.8 million, or 8.5%, compared to $992.5 million in the fourth quarter of 2023.

Operating income/(loss):

• Operating income was $73.8 million, or 8.1% of revenue, an increase of $275.2 million compared to operating loss of $201.4 million, or (20.3%) of revenue, in the fourth quarter of 2023.
• Adjusted operating income was $174.9 million, or 19.3% of revenue, a decrease of $8.8 million, or 4.8%, compared to adjusted operating income of $183.7 million, or 18.5% of revenue, in the fourth quarter of 2023.

Earnings/(loss) per share:

• Earnings per share was $0.04, an increase of $1.38 compared to a loss per share of $1.34 in the fourth quarter of 2023.
• Adjusted earnings per share was $0.76, a decrease of $0.05, or 6.2%, compared to adjusted earnings per share of $0.81 in the fourth quarter of 2023.

Sensata generated $170.7 million of operating cash flow and $138.9 million of free cash flow in the fourth quarter of 2024. Sensata ended the quarter with $593.7 million of cash on hand.

In the quarter, Sensata used cash to repurchase shares valued at approximately $21.6 million and paid $17.9 million in dividends to shareholders.

Operating Results – Full Year

Operating results for the year ended December 31, 2024 compared to the year ended December 31, 2023 are summarized below. These results include non-GAAP financial measures, each of which is defined and reconciled to the most directly comparable GAAP measure later in this press release.

Revenue:

• Revenue was $3,932.8 million, a decrease of $121.3 million, or 3.0%, compared to $4,054.1 million in the year ended December 31, 2023.

Operating income:

• Operating income was $149.3 million, or 3.8% of revenue, a decrease of $32.4 million, or 17.8%, compared to operating income of $181.7 million, or 4.5% of revenue, in the year ended December 31, 2023.
• Adjusted operating income was $748.5 million, or 19.0% of revenue, a decrease of $25.5 million, or 3.3%, compared to adjusted operating income of $774.0 million, or 19.1% of revenue, in the year ended December 31, 2023.

Earnings/(loss) per share:

• Earnings per share was $0.85, an increase of $0.88, compared to a loss per share of $0.03 in the year ended December 31, 2023.
• Adjusted earnings per share was $3.44, a decrease of $0.17, or 4.7%, compared to adjusted earnings per share of $3.61 in the year ended December 31, 2023.

Sensata generated $551.5 million of operating cash flow and $393.0 million of free cash flow in the year ended December 31, 2024.

In July 2024, Sensata redeemed $700 million of bonds that were scheduled to mature in October 2025. The redemption was funded by proceeds from the $500 million senior notes issuance in June 2024 and approximately $200 million of cash on hand.

For the twelve months ended December 31, 2024, Sensata repurchased shares valued at approximately $68.9 million and paid $72.2 million of dividends to shareholders.

Guidance

“Taking into consideration the approximately $300 million of revenue exited in 2024, we expect that full year 2025 revenue will be organically flat with 2024 at approximately $3.6 billion,” said Brian Roberts, EVP and CFO of Sensata. “For the first quarter of 2025, our guidance reflects the return to a more normalized margin seasonality. As revenue increases in the second quarter, typically our seasonally strongest quarter, we expect adjusted operating margins to return to 19.0% or better and then continue to improve in the second half of 2025.”

Sensata’s financial guidance does not reflect potential impacts of recently announced tariffs which may be imposed or threatened to be imposed by the United States on Canada, China, Mexico, and other countries as well as any retaliatory actions that may be taken.

Conference Call and Webcast

Sensata will conduct a conference call today at 4:30 p.m. Eastern Time to discuss its fourth quarter and full year 2024 financial results and its outlook for the first quarter of 2025. The dial-in numbers for the call are 1-844-784-1726 or 1-412-380-7411. Callers should reference the “Sensata Q4 2024 Financial Results Conference Call.” A live webcast of the conference call will also be available on the investor relations page of Sensata’s website at http://investors.sensata.com. Additionally, a replay of the call will be available until February 18, 2025. To access the replay, dial 1-877-344-7529 or 1-412-317-0088 and enter confirmation code: 9019340.

About Sensata Technologies

Sensata Technologies is a global industrial technology company striving to create a safer, cleaner, more efficient and electrified world. Through its broad portfolio of mission-critical sensors, electrical protection components and sensor-rich solutions, Sensata helps its customers address increasingly complex engineering and operating performance requirements. With more than 18,000 employees and global operations in 15 countries, Sensata serves customers in the automotive, heavy vehicle & off-road, industrial, and aerospace markets. Learn more at www.sensata.com and follow Sensata on LinkedIn, Facebook, X and Instagram.

Non-GAAP Financial Measures

We supplement the reporting of our financial information determined in accordance with U.S. generally accepted accounting principles (“GAAP”) with certain non-GAAP financial measures. We use these non-GAAP financial measures internally to make operating and strategic decisions, including the preparation of our annual operating plan, evaluation of our overall business performance, and as a factor in determining compensation for certain employees. We believe presenting non-GAAP financial measures is useful for period-over-period comparisons of underlying business trends and our ongoing business performance. We also believe presenting these non-GAAP measures provides additional transparency into how management evaluates the business.

Non-GAAP financial measures should be considered as supplemental in nature and are not meant to be considered in isolation or as a substitute for the related financial information prepared in accordance with U.S. GAAP. In addition, our non-GAAP financial measures may not be the same as, or comparable to, similar non-GAAP measures presented by other companies.

The non-GAAP financial measures referenced by Sensata in this release include: adjusted net income, adjusted earnings per share (“EPS”), adjusted operating income, adjusted operating margin, free cash flow, organic revenue growth, market outgrowth, adjusted corporate and other expenses, adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”), net debt, and net leverage ratio. We also refer to changes in certain non-GAAP measures, usually reported either as a percentage or number of basis points, between two periods. Such changes are also considered non-GAAP measures.

Adjusted net income (or loss) is defined as net income (or loss), determined in accordance with U.S. GAAP, excluding certain non-GAAP adjustments which are detailed in the accompanying reconciliation tables. Adjusted EPS is calculated by dividing adjusted net income (or loss) by the number of diluted weighted-average ordinary shares outstanding in the period. We believe that these measures are useful to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends.

Adjusted operating income (or loss) is defined as operating income (or loss), determined in accordance with U.S. GAAP, excluding certain non-GAAP adjustments which are detailed in the accompanying reconciliation tables. Adjusted operating margin is calculated by dividing adjusted operating income (or loss) by net revenue. We believe that these measures are useful to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends.

Free cash flow is defined as net cash provided by/(used in) operating activities less additions to property, plant and equipment and capitalized software. We believe that this measure is useful to investors and management as a measure of cash generated by business operations that will be used to repay scheduled debt maturities and can be used to fund acquisitions, repurchase ordinary shares, or for the accelerated repayment of debt obligations.

Organic revenue growth (or decline) is defined as the reported percentage change in net revenue calculated in accordance with U.S. GAAP, excluding the period-over-period impact of foreign exchange rate differences as well as the net impact of acquisitions, divestitures, and product life-cycle management, if material, for the 12-month period following the respective transaction date(s). We believe that this measure is useful to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends.

Adjusted EBITDA is defined as net income (or loss), determined in accordance with U.S. GAAP, excluding interest expense, net, provision for (or benefit from) income taxes, depreciation expense, amortization of intangible assets, and the following non-GAAP adjustments, if applicable: (1) restructuring related and other, (2) financing and other transaction costs, and (3) deferred gain or loss on derivative instruments. We believe that this measure is useful to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends.

Adjusted corporate and other expenses is defined as corporate and other expenses calculated in accordance with U.S. GAAP, excluding the portion of non-GAAP adjustments described below that relate to corporate and other expenses. We believe adjusted corporate and other expenses is useful to management and investors in understanding the impact of non-GAAP adjustments on operating expenses not allocated to our segments.

Gross leverage ratio is defined as gross debt divided by last twelve months (LTM) adjusted EBITDA. We believe that gross leverage ratio is a useful measure to management and investors in understanding trends in our overall financial condition.

Net debt is defined as total debt, finance lease, and other financing obligations less cash and cash equivalents. We believe net debt is a useful measure to management and investors in understanding trends in our overall financial condition.

Net leverage ratio is defined as net debt divided by last twelve months (LTM) adjusted EBITDA. We believe the net leverage ratio is a useful measure to management and investors in understanding trends in our overall financial condition.

In discussing trends in our performance, we may refer to certain non-GAAP financial measures or the percentage change of certain non-GAAP financial measures in one period versus another, calculated on a constant currency basis. Constant currency is determined by stating revenues and expenses at prior period foreign currency exchange rates and excludes the impact of foreign currency exchange rates on all hedges and, as applicable, net monetary assets. We believe these measures are useful to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends.

Safe Harbor Statement

This earnings release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by terminology such as “may,” “will,” “could,” “should,” “expect,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “forecast,” “continue,” “intend,” “plan,” “potential,” “opportunity,” “guidance,” and similar terms or phrases. Forward-looking statements involve, among other things, expectations, projections, and assumptions about future financial and operating results, objectives, business and market outlook, trends, priorities, growth, shareholder value, capital expenditures, cash flows, demand for products and services, share repurchases, and Sensata’s strategic initiatives, including those relating to acquisitions and dispositions and the impact of such transactions on our strategic and operational plans and financial results. These statements are subject to risks, uncertainties, and other important factors relating to our operations and business environment, and we can give no assurances that these forward-looking statements will prove to be correct.

A wide variety of potential risks, uncertainties, and other factors could materially affect our ability to achieve the results either expressed or implied by these forward-looking statements, including, but not limited to, risks related to instability and changes in the global markets, supplier interruption or non-performance, changes in trade-related tariffs and risks with uncertain trade environments, the acquisition or disposition of businesses, adverse conditions or competition in the industries upon which we are dependent, intellectual property, product liability, warranty, and recall claims, public health crises, market acceptance of new product introductions and product innovations, labor disruptions or increased labor costs, and changes in existing environmental or safety laws, regulations, and programs.

Investors and others should carefully consider the foregoing factors and other uncertainties, risks, and potential events including, but not limited to, those described in Item 1A: Risk Factors in our most recent Annual Report on Form 10-K and as may be updated from time to time in Item 1A: Risk Factors in our Quarterly Reports on Form 10-Q or other subsequent filings with the United States Securities and Exchange Commission. All such forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update these statements other than as required by law.

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Segment Performance

⁽¹⁾ In the three months ended March 31, 2024, we realigned our business as a result of organizational changes that better allocate our resources to support changes to our business strategy. The most significant changes include combining our Automotive and Heavy Vehicle and Off-Road (“HVOR”) businesses (with the combined business remaining in Performance Sensing) and moving the various assets and liabilities comprising our vehicle area network and data collection businesses (the “Insights Business”) out of Performance Sensing to a new operating segment, which is not aggregated within either of our reportable segments. We combined the Automotive and HVOR businesses to better leverage our core capabilities and prioritize product focus. We also moved certain shorter-cycle businesses from Performance Sensing to Sensing Solutions, which will benefit from organizing these businesses together, by allowing us to scale core capabilities and better serve our customers. Prior year amounts have been reclassified.

Revenue by Business, Geography, and End Market (Unaudited)

Contacts

Media & Investors:

James Entwistle

+1(508) 954-1561

[email protected]
[email protected]

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