Executive Summary

Q4 2024 net sales were $310.3M, roughly flat year-over-year (+0.5%), while Value-Added Sales (VAS) were $167.7M (−0.6% YoY); Adjusted EBITDA rose to $34.7M with a 21% VAS margin versus $23.1M and 14% in Q4 2023, as lower material and conversion costs drove margin improvement despite softer volumes .
Diluted EPS was a loss of $0.75 (vs. $0.44 loss in Q4 2023) as net loss widened to $(9.6)M; sequentially, revenue declined versus Q3 ($321.8M), with margin normalizing to 21% from 24% in Q3 .
2025 outlook guides net sales of $1.30–$1.40B, VAS $650–$700M, Adjusted EBITDA $160–$180M, and unlevered FCF $110–$130M; management expects margin expansion in 2H 2025, supported by completed European consolidation and cost initiatives, while monitoring multi-faceted tariff effects (not embedded in the guide) .
Strategic catalysts: completed European manufacturing transformation (Poland), ~20% excess capacity in Europe and Mexico to absorb localization wins, $520M refinancing extending maturities to 2028 (Total Debt $520M, YE Net Debt $479.7M), and ongoing preferred equity discussions .

What Went Well and What Went Wrong

What Went Well

Adjusted EBITDA improved to $35M (rounded) and margin expanded to 21% vs. 14% YoY; management credited lower material and conversion costs and cost performance in both regions .
European transformation completed: consolidation into Poland aligned EU margins with North America; management highlights competitive “local-for-local” footprint and 20% excess capacity in Europe and Mexico to capture localization wins .
Refinancing: attracted $520M and extended maturities to 2028, strengthening financial flexibility; YE total debt $520M and Net Debt $479.7M .

What Went Wrong

Net loss widened to $(9.6)M and diluted EPS loss of $(0.75), driven in part by interest expense and tax provision; sequential revenue fell vs. Q3, and cash from operations declined YoY vs. Q4 2023 .
Working capital investments reduced quarterly unlevered FCF to $36.0M from $50.1M YoY; sequential unlevered FCF also declined vs. Q3 due to higher working capital .
Industry volumes remain pressured; 2025 planning assumes ~4% production decline (NA −2%, EU −6%), with tariffs posing both tailwinds and headwinds that are not included in the guide, adding forecasting uncertainty .

Financial Results

Quarterly trend (sequential)

Metric	Q2 2024	Q3 2024	Q4 2024
Net Sales ($USD Millions)	$319.0	$321.8	$310.3
Value-Added Sales ($USD Millions)	$180.3	$171.0	$167.7
Adjusted EBITDA ($USD Millions)	$40.0	$40.8	$34.7
Adjusted EBITDA Margin (% of VAS)	22%	24%	21%
Diluted EPS ($USD)	$(0.75)	$(1.24)	$(0.75)

Year-over-year comparison (Q4)

Metric	Q4 2023	Q4 2024
Net Sales ($USD Millions)	$308.7	$310.3
Value-Added Sales ($USD Millions)	$168.7	$167.7
Adjusted EBITDA ($USD Millions)	$23.1	$34.7
Adjusted EBITDA Margin (% of VAS)	14%	21%
Diluted EPS ($USD)	$(0.44)	$(0.75)

Segment breakdown (Q4)

Region	Net Sales Q4 2023 ($MM)	Net Sales Q4 2024 ($MM)	VAS Q4 2023 ($MM)	VAS Q4 2024 ($MM)
North America	$179.8	$183.2	$93.3	$92.4
Europe	$128.9	$127.1	$75.4	$75.3
Total	$308.7	$310.3	$168.7	$167.7

KPIs and Cash Flow

KPI	Q2 2024	Q3 2024	Q4 2024
Wheels Shipped (000s)	3,469	3,381	3,321
Content per Wheel ($)	$52.21	$50.29	$50.56
Cash from Operations ($MM)	$(8.0)	$(3.3)	$26.2
Free Cash Flow ($MM)	$(16.4)	$(9.4)	$18.9
Unlevered Free Cash Flow ($MM)	$1.7	$8.8	$36.0
Net Debt ($MM)	—	$496.7 (9/30/24)	$479.7 (12/31/24)

Notes: Q3 Adjusted EBITDA is reported as $40.8M in supplemental tables vs. “$41M” in the narrative; we use $40.8M for precision .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance/Actual	Change
Net Sales	FY 2024	$1.25–$1.33B	$1.267B actual	Within range (mid)
Value-Added Sales	FY 2024	$680–$700M	$691.2M actual	Within range
Adjusted EBITDA	FY 2024	$146–$154M	$146.3M actual	At low end
Unlevered Free Cash Flow	FY 2024	$50–$80M	$55.4M actual	Toward low end
Capital Expenditures	FY 2024	~$35M	$28.3M actual	Lower than guide
Net Sales	FY 2025	N/A	$1.30–$1.40B	New
Value-Added Sales	FY 2025	N/A	$650–$700M	New
Adjusted EBITDA	FY 2025	N/A	$160–$180M	New
Unlevered Free Cash Flow	FY 2025	N/A	$110–$130M	New
Capital Expenditures	FY 2025	N/A	~$35M	New
Effective Tax Rate	FY 2025	N/A	20–30% (modeled)	New
Dividends (Quarterly)	Q4 2023 vs Q4 2024	Cash paid $6.8M in Q4’23	None; dividends PIK for preferred	Maintained PIK; reduced cash outflow

Management notes FY 2025 guide excludes net tariff impacts and anticipates margin expansion in 2H 2025 as remaining wheel transfers and cost reductions flow through .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2024)	Previous Mentions (Q3 2024)	Current Period (Q4 2024)	Trend
Supply chain localization	Emphasized local-for-local footprint; European consolidation underway	Localization wins with Japanese OEM (NA) and aftermarket (EU)	Advanced dialogues; multiple short-term localization wins; contracts ≥5 years	Strengthening
Tariffs/macro	Inflation, dealer inventory, production declines noted	IHS: volumes down; restructuring to align costs	Detailed multi-faceted tariff impacts (aluminum pass-through neutral; EU/US tariffs favor localization; Mexico duties exposure <20%)	Rising importance
Capacity	Poland ramp reduces launching gap; cost absorption expected	Margin expansion; EU margins moving toward NA	~20% excess capacity in Europe/Mexico to absorb localized demand	Improving flexibility
Pricing/inflation recovery	Pivot to permanent price increases (vs one-off recoveries)	Recoveries lower vs prior year but permanent increases secured	Continued price negotiations and cost performance support margins	Stabilizing
European transformation	Exit Germany (SPG), transfer to Poland; $23–$25M annual benefit targeted	Benefits realized; margins expanded ~200 bps YoY	Completed; EU margins aligned with NA	Completed execution
Debt/refinancing	In advanced lender discussions to retire notes	Completed refinancing; $520M; maturities to 2028	Debt $520M YE; focus on cash generation and leverage covenants	Executed; monitor leverage
Preferred equity	—	—	Advanced constructive discussions; optional redemption contingent on ability to pay	New focus
Content per wheel / product mix	34% content growth since 2019; premium launches highlighted	33% content growth since 2019; premium technologies	Q4 content per wheel $50.56	Sustained premium mix
R&D recognition	Audi “A” rating for R&D excellence	Continued tech leadership messaging	“Leading portfolio of product technologies” reiterated	Sustained recognition

Management Commentary

“We successfully executed on our global overhead reduction initiative and completed our European transformation… we successfully attracted $520 million in capital and refinanced all our debt” — Majdi Abulaban, CEO .
“Margins in Europe are now relatively in line with those in North America… adjusted EBITDA margin was in line with last year, even with lower production volumes” — Majdi Abulaban .
“Recent tariff actions… have a multifaceted impact… favorable and unfavorable… we are closely monitoring this fluid situation and will update our financial outlook accordingly” — Majdi Abulaban .
“Total cash… $40M… zero drawn on our $60M revolver… Total debt… $520M… we successfully completed our debt refinancing in 2024” — Dan Lee, CFO .

Q&A Highlights

Capacity and localization: Company has ~20% excess capacity in Europe and Mexico; accelerating localization demand due to tariffs; recent wins include one Chinese-import replacement to start within months; contracts are long-term (≥5 years) despite “short-term” start-up timelines .
Market outlook and guidance: IHS projects combined NA/EU production down ~4% in 2025 (EU ~−6%, NA ~−2%); guide assumes slightly negative-to-flat units but outperforming market via mix, aftermarket, and transferred volumes from Germany to Poland not fully reflected in 2024 .
Preferred equity: Optional redemption subject to Board approval and company’s ability to fund payment; dividends currently PIK; ongoing advanced discussions to address preferred equity .
Covenants/leverage: Leverage covenant 3.75x in Q4/Q1, dropping to 3.5x in Q2; adjusted EBITDA plus stock comp used in calculation .

Estimates Context

S&P Global consensus estimates for Q4 2024 and FY 2024 were unavailable via our SPGI mapping for SUP; therefore, we cannot provide or compare against Wall Street consensus in this recap. We searched for EPS, revenue, and EBITDA consensus and # of estimates but did not receive SPGI data due to missing mapping (SpgiEstimatesError). Future estimate comparisons will be added once SPGI mapping is updated [SpgiEstimatesError].

Key Takeaways for Investors

Margin resilience: Despite flat-to-down volumes, Q4 Adjusted EBITDA margin held at 21% (vs. 14% YoY), and 2025 guide implies mid-teens EBITDA growth driven by completed EU consolidation and cost actions; watch for 2H margin expansion as volume transfers and cost run-rate benefits materialize .
Localization tailwinds: Multi-faceted tariff regime likely accelerates OEM localization in NA and EU; SUP’s low-cost Mexico/Poland footprint and excess capacity position it to capture incremental wins (positive mix/content per wheel) .
Cash generation and leverage: YE total debt $520M and Net Debt $479.7M; 2025 unlevered FCF guide $110–$130M indicates deleveraging capacity; monitor covenant levels and working capital trajectory .
Preferred equity overhang: Advanced discussions underway; optional redemption subject to ability to pay; resolution could be a stock driver by reducing uncertainty around capital structure .
Execution in Europe: Transformation completed; EU margins aligned with NA; expect benefits from capacity utilization and cost structure improvements to sustain margins even in softer industry conditions .
Near-term trading: Watch headlines on tariffs (Mexico/US/EU) and any incremental localization program awards; any update to 2025 outlook to reflect tariff impacts could move the stock .
Medium-term thesis: Premium technology portfolio, rising content per wheel, and local-for-local production underpin structural margin stability and FCF generation through cyclical production swings .

SUPERIOR INDUSTRIES INTERNATIONAL INC (SUP)·Q4 2024 Earnings Summary