Cooper Standard earnings strengthen on ‘favourable mix, volume’

Novi, Michigan – Cooper Standard has more than doubled earnings (adjusted EBITDA) in the first quarter of 2024, due mainly to stronger mix and volumes.

For the three months to 31 March, the US automotive parts supplier posted adjusted earnings of $29 million (€27 million), up from $12.5 million in the same period last year.

In addition to favourable mix and volumes, Cooper Standard linked the gains to “sustainable price adjustments, and savings generated from lean manufacturing and purchasing initiatives.”

The gains were partially offset by continuing inflationary pressures, including higher labour and energy costs, and currency-impact, the group reported 6 May.

Sales for the quarter dipped marginally to $676 million, largely due to the sale of the group’s ‘technical rubber’ business to Holcim last August (ERJ report) and unfavourable currency effects.

These factors were partially offset by favourable volume and mix, including sustainable price adjustments.

Net loss for the quarter narrowed to $31.7 million, compared to $130.4 million reported last year, continued Cooper Standard's report.

Meanwhile, the US group said it had realigned its operating management structure on a product-line basis rather than the prior geographic-region basis.

In place since the start of this year, the new structure includes two reporting segments: 'sealing systems' and 'fluid handlings sytems'.

The rejig is expected to “optimise asset- and resource-allocation, enhance operating efficiency and aid in accelerating growth,” Cooper Standard stated.

The first quarter improvements and margin-expansion have “set a solid foundation for a strong 2024," commented Jeffrey Edwards, chairman and CEO.

"Through our new product line-based management structure, we expect to aggressively pursue further cost structure optimisation,” he added.

Off this and other commercial agreements, Edwards expects “meaningful additional margin expansion… [which] should represent upside to our original full-year guidance, assuming industry production volumes hold."

In terms of new business awards, Cooper Standard said it is capitalising on positive trends associated with hybrid and battery electric vehicles.

During the first quarter, the group received net new-business awards totalling $66.2 million in anticipated future annualised sales.

Orders included $34.0 million of net new-business awards on hybrid vehicle platforms and $19.1 million on battery electric vehicles.

For the full-year, Cooper Standard noted that industry projections for light vehicle production are similar to levels realised in 2023.