CTS Corporation (CTS) Q3 2022 Earnings Call Transcript

Oct. 26, 2022 1:48 PM ETCTS Corporation (CTS)
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CTS Corporation (NYSE:CTS) Q3 2022 Earnings Conference Call October 26, 2022 10:00 AM ET

Company Participants

Kieran O'Sullivan - Chairman, President and Chief Executive Officer

Ashish Agrawal - Vice President and Chief Financial Officer

Conference Call Participants

Joshua Buchalter - Cowen Inc.

John Franzreb - Sidoti and Company, LLC

Brady Lierz - Stephens Inc.

Hendi Susanto - Gabelli Funds LLC

Operator

Hello, everyone, and welcome to the CTS Q3 2022 Earnings Call. My name is Seb, and I will be the operator for your call today. [Operator Instructions]

I would now hand the floor over to Kieran O'Sullivan, CEO to begin. Please go ahead.

Kieran O'Sullivan

Thanks, Seb. Good morning, and welcome, everyone to our third quarter 2022 earnings call. We delivered another strong quarter and reported solid financial results that were propelled forward by our strategic focus on diversification. Sales in the third quarter were a $152 million, up approximately 24% compared to the third quarter of 2021. Third quarter adjusted gross margin was 36.6%, down 70 basis points from 37.3% in the third quarter of last year. Adjusted EBITDA margin of 22.3% was up 60 basis points from 21.7% in the same period in 2021. Third quarter adjusted earnings per diluted share of $0.62 were up 34% from $0.46 in the third quarter of 2021.

Non-transportation sales accounted for approximately 48% of our overall revenue as we continue to advance our diversification strategy. Electrification progress was solid as we added six EV platform wins in the quarter and expanded our total available market with new electrification products.

Last quarter, we completed the Ferroperm acquisition. The business is performing well with the work in progress to consolidate the two facilities in Denmark. We are already seeing potential customer wins in North America using Ferroperm proprietary material formulations. We expect the acquisition to be

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