Mattr (MATR) Q3 2024 earnings summary

Executive summary

• Q3 2024 consolidated revenue was $250M, Adjusted EBITDA $37M, and Adjusted EPS $0.23, including discontinued Brazil operations and $3.1M in MEO costs and $1.9M in severance costs.

• Entered agreement to sell Thermotite (Brazilian pipe coating) for ~$24M, now classified as discontinued operations, with closing expected by mid-2025.

• Announced AmerCable acquisition for $280M USD, expected to close around year-end 2024, enhancing U.S. wire and cable market presence and expected to be immediately accretive.

• Continued active share repurchases under the NCIB and ongoing investment in growth initiatives.

• Progressed on new manufacturing sites and operational transformation, with substantial completion targeted by year-end 2024.

Financial highlights

• Q3 revenue from continuing operations was $226M, up 2% year-over-year; consolidated Adjusted EBITDA was $36.7M; Adjusted EBITDA from continuing operations was $29.3M, down 26.9% year-over-year.

• Composite Technologies revenue fell 2.7% to $136.4M; Adjusted EBITDA dropped to $20.3M from $32.4M, mainly due to lower gross margin and higher costs.

• Connection Technologies revenue rose 9.9% to $89.9M, a Q3 record; Adjusted EBITDA margin decreased to 13.3% from 17.8%.

• Discontinued operations (Thermotite/Brazil) reported $24M in revenue and $7.5M in Adjusted EBITDA, with operations fully booked into mid-2025.

• Cash and cash equivalents at Q3 end were $186M; net cash used in the quarter was $67.6M.

Outlook and guidance

• Q4 2024 revenue expected to be the lowest of the year due to seasonal and macro headwinds, with full-year revenue similar to or slightly below 2023.

• Fourth quarter Adjusted EBITDA will reflect lower revenue, $6-8M in severance, and ongoing MEO costs.

• 2025 outlook for North American industrial and infrastructure sectors remains strong; anticipate $20M in annual cost savings from restructuring.

• CapEx for 2024 expected at $90M–$100M; 2025 CapEx likely at the upper end of $30M–$50M.

• AmerCable acquisition expected to increase exposure to electrification macro theme and support long-term growth.