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Rogers Corporation announced financial results for the third quarter of 2024.
"Third-quarter results were mixed with earnings that exceeded our guidance expectations and sales that were below the low end of our outlook,” stated Colin Gouveia, Rogers' President and CEO. "The higher earnings resulted from our ongoing focus on operational improvements, improved product mix, and careful expense management. Sales for the quarter were lower than expected due to softer EV/HEV demand and a lower seasonal peak in portable electronics sales. Looking ahead to the fourth quarter, we expect sales to decline due to typical seasonality and deferred ordering as customers manage year-end inventory levels. We continue to execute our focused strategy to position Rogers for the long-term, as highlighted by the ribbon-cutting ceremony at our new power substrate factory in China, which is targeted to growth opportunities in the EV/HEV, renewable energy, and industrial markets."
Q3 2024 Summary of Results
Net sales of $210.3 million decreased 1.8% versus the prior quarter resulting from lower sales in the AES and EMS business units. AES net sales decreased by 2.9% primarily related to lower EV/HEV, ADAS and industrial sales, partially offset by higher aerospace and defense (A&D) and wireless infrastructure sales. EMS net sales decreased by 0.5% primarily from lower EV/HEV and A&D sales, partially offset by higher portable electronics and general industrial sales. Currency exchange rates favorably impacted total company net sales in the third quarter of 2024 by $0.3 million compared to the prior quarter.
Gross margin increased to 35.2% from 34.1% in the prior quarter primarily from favorable product mix, which was partially offset by lower volumes.
Selling, general and administrative (SG&A) expenses decreased by $5.8 million from the prior quarter to $45.1 million. The decline in SG&A expenses was primarily due to lower variable compensation and professional services expenses.
GAAP operating margin of 6.9% increased from 5.3% in the prior quarter, primarily due to improved gross margin and lower SG&A expenses, partially offset by higher restructuring charges. Adjusted operating margin of 11.7% increased by 350 basis points versus the prior quarter.
GAAP earnings per diluted share were $0.58 compared to earnings per diluted share of $0.44 in the previous quarter. On an adjusted basis, earnings were $0.98 per diluted share compared to earnings of $0.69 per diluted share in the prior quarter.
Ending cash and cash equivalents were $146.4 million, an increase of $26.5 million versus the prior quarter. Net cash provided by operating activities in the third quarter was $42.4 million and capital expenditures were $17.2 million.
