Linamar (LNR) Q4 2024 earnings summary

Executive summary

• Achieved record sales of $10.6 billion in 2024, up 8.7% year-over-year, with double-digit normalized earnings growth and nearly $800 million in free cash flow, despite down markets in all segments.

• Mobility segment delivered 30.6% normalized operating earnings growth to $427.7 million, while Industrial segment sales rose 16.9% to $3.1 billion, aided by the Bourgault acquisition.

• Significant new business wins in Mobility, with the launch book reaching $3.5 billion and over $100 million in annual disconnect technology sales.

• Returned over $80 million to shareholders through dividends and repurchased over 1.4 million shares under the NCIB program.

• Recorded a $385.5 million non-cash goodwill impairment in European Mobility due to market deterioration.

Financial highlights

• FY 2024 sales reached $10.6 billion, up 8.7% year-over-year; normalized net earnings were $604.4 million, up 11.7%; normalized EPS was $9.81, up 11.7%.

• Q4 sales were $2.4 billion, down 3.2% year-over-year; normalized net earnings were $111.8 million, and normalized EPS was $1.82, both down 8%.

• Free cash flow reached $490.8 million in Q4 and $788.3 million for the year, a significant increase from 2023.

• Gross margin improved to 14.2% for 2024 from 13.6% in 2023.

• Cash and cash equivalents at year-end were $1,054.6 million, up 61.4% from prior year.

Outlook and guidance

• FY 2025 sales expected to be flat versus 2024, with normalized EPS and net margin projected to grow and expand within normal ranges.

• Industrial segment anticipates double-digit sales and earnings declines in 2025, while Mobility expects flat sales and double-digit OE growth, with new programs adding $500–700 million in sales.

• Management remains focused on revenue, margin, and team growth, leveraging speed and lean manufacturing.

• Capex expected to remain flat and below the normal range at 5% of sales.

• Cautious outlook due to ongoing trade policy uncertainties, tariffs, and European market weakness.