• Revenue: $230 million for Q2 2024, down from $262 million in the prior year period.

• Adjusted EBITDA: $10 million for Q2 2024, compared to $20.8 million in the prior year.

• Adjusted EBITDA Margin: 4.3%, down 360 basis points from 7.9% in Q2 2023.

• Net Loss: $1.6 million or $0.05 per diluted share, compared to net income of $10.1 million or $0.30 per diluted share in the prior year.

• Adjusted Net Income: $2.1 million or $0.06 per diluted share, compared to $10.7 million or $0.32 per diluted share in the prior year.

• Electrical Systems Revenue: $50.2 million, a decrease of 21.2% year-over-year.

• Vehicle Solutions Revenue: $140.9 million, a decrease of 8% year-over-year.

• Aftermarket and Accessories Revenue: $33.9 million, a decrease of 8.1% year-over-year.

• Industrial Automation Revenue: $5 million, a decrease of 45% year-over-year.

• Interest Expense: $2.5 million, down from $2.8 million in Q2 2023.

• Restructuring Expenses: $6.8 million year-to-date, with a 10% reduction in headcount.

• 2024 Revenue Guidance: Adjusted to $900 million to $960 million.

• 2024 Adjusted EBITDA Guidance: Adjusted to $42 million to $52 million.

• Warning! GuruFocus has detected 5 Warning Signs with CVGI.

Release Date: August 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Commercial Vehicle Group Inc (NASDAQ:CVGI) executed an agreement for the profitable sale of its cab structures business in Kings Mountain, North Carolina, which will streamline its product portfolio and help pay down debt.

• The company achieved approximately $32 million in new business awards during the quarter, bringing the year-to-date total to approximately $80 million across all segments.

• CVGI received the Navistar Supplier Excellence Award, recognizing its top performance in quality, delivery, cost, and continuous improvement.

• The company is actively restructuring to optimize its cost structure, having deployed almost $7 million in restructuring expenses and reducing headcount by more than 10%.

• CVGI is focusing on high-growth segments, particularly electrical systems, and is positioning itself to benefit from market rebounds with new business wins and a lower cost structure.

Negative Points

• Second quarter results fell short of expectations with year-over-year declines in revenue and profitability due to multiple internal and external factors.

• The electrical systems segment experienced a 21.2% decrease in revenue due to lower customer demand and the phase-out of lower-margin business.

• Operational inefficiencies and disruptions during a significant product launch in the vehicle solutions segment negatively impacted performance.

• The company faced FX headwinds and unrecovered economics from several major customers, affecting business margins.

• CVGI's industrial automation segment saw a 45% decrease in revenue due to reduced customer demand, resulting in an adjusted operating income loss.