Gates Industrial Reports 2nd-Quarter 2022 Results.

DENVER:

Second-Quarter 2022 Highlights

Net sales of $906.8 million, including core revenue growth of 3.6%, compared to a record prior-year period.

Net income attributable to shareholders of $53.1 million, or $0.19 per diluted share.

Adjusted Net Income of $90.2 million, or $0.32 per diluted share.

Adjusted EBITDA of $180.1 million.

Gates Industrial Corporation plc ( NYSE: GTES), a leading global provider of application-specific power transmission and fluid power solutions, today reported results for the second quarter ended July 2, 2022.

Ivo Jurek, Gates Industrial's Chief Executive Officer, commented, "I'm pleased with our performance, which represents solid improvement from the first quarter under difficult operating conditions. Underlying demand trends for our products are constructive across most of our markets and our backlog has continued to grow. We have targeted capacity additions underway to support the progress we've made with our growth initiatives, which will alleviate capacity constraints we're facing in certain product lines. Also, the pricing actions we've taken have allowed us to offset the significant inflation and deliver solid sequential margin expansion."

Jurek continued, "We are experiencing more significant FX headwinds and navigating operational challenges arising from external factors, primarily the persisting unreliable supply of certain key raw materials. While we see our business in China steadily improving, it will take additional time to fully recover as our customers and suppliers progress towards more normal operating levels. Our business model is resilient, focused on delivering mission-critical, highly engineered solutions for demanding applications. Over the past several years, we've steadfastly invested in innovation and our growth initiatives, which are contributing to the solid order flows we're seeing. We have a strong team in place and are focused on managing through the present challenges to support our customers' needs. With targeted capacity coming online and continued benefit from pricing actions, we believe we are well positioned to continue to deliver sequential revenue and margin improvement in the second half of the year."

Second-Quarter Financial Results

Second-quarter net sales of $906.8 million decreased 0.9% over the prior-year quarter's record net sales of $915.1 million, including a 3.6% core revenue increase offset by unfavorable foreign currency impact of 4.5%. The core revenue increase...