Cooper-Standard Holdings Inc. Q2 FY2025 earnings call

• Operational Performance: Ended Q2 with 100% of 317 customer scorecards green for quality and service, 97% green for new program launches, safety incident rate 0.26 (below benchmark), 44 plants with 0 incidents in H1. • Cost Optimization: $25M savings from lean initiatives, $4M from restructuring, and leveraging cost-saving programs. • New Business: Awarded $77M net new business in Q2 2025. • Customer Awards: Received Ford Supplier of the Year and collaborated with Renault Group on Emblème project.

The company has two main product segments: Sealing System and Fluid Handling Systems. The Sealing System strategy focuses on sustaining operational excellence, leveraging digital tools like C S Factory, and driving profitable growth in existing and new markets, aiming for average 6% revenue growth over 5 years with EBITDA margins and return on capital increasing to ~20% by 2030. The Fluid Handling Systems strategy is about unlocking potential, expanding geographically, leveraging hybrid vehicle trends, and launching innovative products, aiming for average ~8% annual revenue growth with EBITDA margins reaching ~16% and return on invested capital approaching 30% by 2030.

• Raised full-year adjusted EBITDA guidance due to strong operational execution. • Focus on execution after completing tariff negotiations. • Expect positive free cash flow for the full year and net leverage ratio below 4x at year-end. • Strategic plans for Sealing and Fluid Handling Systems with long-term growth targets.

• Uncertainty around U.S. trade policy and tariff impacts on the auto industry. • Industry production volume fluctuations which could impact performance. • Credit market conditions affecting capital structure and refinancing plans.

Q: Kirk Ludtke at Imperial Capital asked about sealing and fluid revenue projections, specifically net new business and volume assumptions.

A: Jeff Edwards and Jonathan P. Banas discussed net new business awards, volume assumptions based on S&P forecasts, and how growth is projected.

Q: Michael Patrick Ward at Citi Research inquired about margins, cash flow, and refinancing.

A: Jeff Edwards talked about margin targets and potential upside, Jonathan P. Banas discussed cash restructuring and working capital unwinding, and refinancing outlook.

Q: Ben Briggs at StoneX Financial asked about working capital cash use and unwinding.

A: Jonathan P. Banas explained that the main component of working capital outflow was accounts receivable build-up and expected normalization in the second half.