Garrett Motion Inc. has recently released its 10-Q report, providing a comprehensive overview of the company's financial performance and operations for the three and nine months ended September 30, 2024. Garrett Motion is a global leader in turbocharging, air and fluid compression, and high-speed electric motor technologies for various industries, including light vehicles, commercial vehicles, and industrial applications.
In the third quarter of 2024, Garrett Motion faced challenges in the light vehicle segment, particularly in Europe and China, due to industry softness and competitive pressure. Despite these challenges, the company achieved a net income of $52 million and adjusted EBITDA of $144 million for the quarter. Additionally, Garrett Motion secured significant industrial contracts in the marine and power generation sectors and received a letter of intent for its E-Powertrain from a major truck manufacturer in the commercial vehicle industry.
During the three and nine months ended September 30, 2024, Garrett Motion repurchased $52 million and $226 million, respectively, of common stock under its share repurchase program. The company also divested its equity interest in an unconsolidated joint venture for approximately $58 million, recognizing a gain of $27 million related to this divestiture. Furthermore, Garrett Motion completed an offering of $800 million in aggregate principal amount of 7.75% 2032 Senior Notes and made early debt repayments totaling $985 million on its Euro Term Facility and 2023 Dollar Term Facility.
In terms of revenue, Garrett Motion reported net sales of $826 million for the third quarter of 2024, representing a 14% decrease compared to the prior year. The decrease was primarily driven by lower sales in gasoline and diesel applications due to industry softness in Europe and China, as well as pricing and commodity deflation impacts. The company's gross profit percentage for the quarter was 20.1%.
Cost of goods sold for the three months ended September 30, 2024, decreased by $124 million, primarily driven by lower sales volumes and commodity deflation. Selling, general, and administrative expenses decreased by $6 million for the quarter, mainly due to lower professional service and legal fees.
Interest expense for the three months ended September 30, 2024, decreased by $11 million compared to the prior year, primarily driven by lower debt issuance cost amortization and interest expense. The company reported non-operating income of $1 million for the quarter, as well as a tax expense of $24 million, resulting in an effective tax rate of 31.6%.
The market has reacted to these announcements by moving the company's shares -7.2% to a price of $7.41. For the full picture, make sure to review Garrett Motion's 10-Q report.
