The Goodyear Tire & Rubber Company · NASDAQ:GT
The Goodyear Tire & Rubber — Q4 2024 Earnings Presentation
37 slides from The Goodyear Tire & Rubber's earnings presentation, Feb 14, 2025
Slide 1: Earnings Release Q4 2024
EARNINGS RELEASE Q4 2024 | FEBRUARY 13, 2025 Q4 2024 - 1
Slide 2: 2024 Highlights
2024 HIGHLIGHTS FULL YEAR SEGMENT OPERATING MARGIN expansion across all three business units GOODYEAR FORWARD drives 2024 benefits of $480 million, exceeding plan FOURTH QUARTER FREE CASH FLOW of $1.0 billion, exceptionally strong versus recent years GOODYEAR FORWARD TARGETS REAFFIRMED, significant
Slide 3: Q4 2024 Key Metrics
Q4 2024 KEY METRICS Tire Units Net Sales Segment Operating Income 43.6 $4,947 $385 -4.0% YoY -3.3% YoY +0.5% YoY SOI Margin Free Cash Flow Adjusted EPS 7.8% $1,027 $0.39 +0.3 pts YoY +3.4% YoY -17.0% YoY Terms: Units & $ in millions Highlights Financial Results SBU Results Outlook Important Disclosu
Slide 4: Q4 2024 SBU Metrics
Q4 2024 SBU METRICS Net Sales Segment Operating Income SOI Margin AMERICAS $2,890 $262 9.1% -5.8% YoY -15.2% YoY -1.0 pts YoY $1,451 $41 2.8% EMEA +3.7% YoY +583.3% YoY +2.4 pts YoY $606 $82 13.5% AP -6.8% YoY +20.6% YoY +3.0 pts YoY Terms: Units & $ in millions Highlights Financial Results SBU Resu
Slide 5: Goodyear Forward
GOODYEAR FORWARD Goodyear Forward is a transformation plan designed to deliver significant margin expansion and reduce leverage to drive substantial shareholder value creation. Segment operating income benefited by $480 million in 2024. We expect an additional benefit of $750 million in segment oper
Slide 6: Goodyear Forward
GOODYEAR FORWARD FY 25E Total TOTALActions ACTIONS $480 ~ $750 Footprint & Plant Optimization ~ $300 Purchasing ~ $200 SAG ~ $100 Supply Chain and R&D ~ $50 Margin Expansion ~ $100 Full Year 2024 Realized Full Year 2025 YoY Estimate Terms: $ in millions Highlights Financial Results SBU Results Outlo
Slide 7: Financial Results
GOODJYEAR FINANCIAL RESULTS
Slide 8: Income Statement
INCOME STATEMENT Note: SAG includes Goodyear Forward costs related to advisory, legal and consulting fees and costs associated with planned asset sales Quarter Highlights Financial Results SBU Results Outlook Important Disclosures Appendix Q4 2024 - 8
Slide 9: Segment Operating Results
SEGMENT OPERATING RESULTS FOURTH QUARTER 2024 VERSUS 2023 ($81) ($149) Total Volume Impact Net P/M vs Raws Terms: $ in millions Quarter Highlights Financial Results SBU Results Outlook Important Disclosures Appendix Q4 2024 - 9
Slide 10: Balance Sheet & Cash Flow
BALANCE SHEET & CASH FLOW Total Debt Cash Flow from Operating Activities (GAAP) $6,916 $7,624 $1,289 $1,236 Pro forma Three Months Ended Three Months Ended As of December 31, 2024 (a) As of December 31, 2023 December 31, 2024 December 31, 2023 -9.3% YoY +4.3% YoY Net Debt Free Cash Flow (non-GAAP) $
Slide 11: Addressing Leverage
ADDRESSING LEVERAGE As part of our Goodyear Forward transformation plan, we plan for EBITDA growth and debt reduction to improve our net leverage relative to 2023. During 2024, we delivered improved earnings and in early 2025 reduced debt by using the gross proceeds from the sale of our off-the-road
Slide 12: SBU Results
SBU RESULTS Q4 2024 - 12
Slide 13: Q4 2024 SBU Results – Americas
Q4 2024 SBU RESULTS – AMERICAS TIRE UNITS NET SALES SEGMENT OPERATING INCOME MARGIN 22.0 $2,890 $262 9.1% -4.8% YoY -5.8% YoY -15.2% YoY -1.0 pts YoY • U.S. consumer replacement sell-in industry down ~2% • USTMA member declines of more than three times total industry; continued growth in low-cost im
Slide 14: Q4 2024 SBU Results - EMEA
Q4 2024 SBU RESULTS - EMEA TIRE UNITS NET SALES SEGMENT OPERATING INCOME MARGIN 12.6 $1,451 $41 2.8% +1.5% YoY +3.7% YoY +583.3% YoY +2.4 pts YoY • Consumer replacement industry growth of ~10%, reflecting strong winter sell-in season and continued growth in low-cost imports • ETRMA members sell out
Slide 15: Q4 2024 SBU Results – Asia Pacific
Q4 2024 SBU RESULTS – ASIA PACIFIC TIRE UNITS NET SALES SEGMENT OPERATING INCOME MARGIN 9.0 $606 $82 13.5% -9.3% YoY -6.8% YoY +20.6% YoY +3.0 pts YoY • Consumer replacement sell-in industry up 2% year-over-year; Goodyear volume driven by actions taken to reduce lower margin business in key markets
Slide 16: Outlook
OUTLOOK Q4 2024 - 16
Slide 17: SOI Assumptions
SOI ASSUMPTIONS 2(a) Q1 2025 Global unit volumes down 2% to 3%, reflecting high levels of distributor inventories of low-end imports in the U.S. and lower global OEM production VOLUME ~ $25 million headwind in unabsorbed overhead driven by lower Q4 production PRICE/MIX ~ $65 million favorable, parti
Slide 18: Other Financial Assumptions
OTHER FINANCIAL ASSUMPTIONS 2 (a) FULL YEAR 2025 CORPORATE OTHER NORMAL OPERATING ~ $165 million; ~ $45 million in Q1 Goodyear Forward: ~ $35 million comprised of advisory, legal and consulting fees CORPORATE OTHER GOODYEAR FORWARD* and costs associated with planned asset sales; ~ $25 million in Q1
Slide 19: Industry Assumptions
INDUSTRY ASSUMPTIONS FULL YEAR 2025 CONSUMER COMMERCIAL -2% to 2% 2% to 4% REPL Growth primarily in Europe; U.S. volatility related to imports/prebuy Demand stabilizing Q2-Q4 OE Flattish H1; Americas growth in H2 Slightly weaker H1; strong H2 growth across all regions Quarter Highlights Financial Re
Slide 20: Important Disclosures
IMPORTANT DISCLOSURES Q4 2024 - 20
Slide 21: Important Disclosures: Forward-Looking Statements
IMPORTANT DISCLOSURES FORWARD-LOOKING STATEMENTS Certain information contained in this presentation constitutes forward-looking statements for purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. There are a variety of factors, many of which are beyond our
Slide 22: Use of Non-GAAP Financial Measures
IMPORTANT DISCLOSURES USE OF NON-GAAP FINANCIAL MEASURES (Unaudited) This presentation presents non-GAAP financial measures, including Total Segment Operating Income and Margin, Free Cash Flow, Adjusted Net Income (Loss), Adjusted Diluted Earnings Per Share (EPS) and Net Leverage which are important
Slide 23: Appendix
APPENDIX Q4 2024 - 23
Slide 24: Full Year 2024 Key Metrics
FULL YEAR 2024 KEY METRICS Tire Units Net Sales Segment Operating Income 166.6 $18,878 $1,318 -3.9% YoY -5.9% YoY +36.2% YoY SOI Margin Free Cash Flow Adjusted EPS 7.0% ($428) $1.05 +2.2 pts YoY - $410M +400.0% YoY Terms: Units & $ in millions Quarter Highlights Financial Results SBU Results Outlook
Slide 25: Segment Operating Results Full Year 2024 versus 2023
SEGMENT OPERATING RESULTS FULL YEAR 2024 VERSUS 2023 $67 $1,318 ($220) $55 $121 $67 $1,318 $480 ($220) $480 1 (e) $480 Other $55 $54 ($16) ($16) 1 (d) Insurance 1 (d) Foreign Foreign Non- Non- Proceeds, $968 ($185) 11 (c) (c) Cost Cost Currency Recurrence Recurrence Net of Calculated Savings Savings
Slide 26: Significant Maturities Schedule
SIGNIFICANT MATURITIES SCHEDULE PRO FORMA AS OF DECEMBER 31, 2024 3 3 (a) $2,416 3 (b) 3 (c) $85 $832 $- $- $1,234 $1,051 $566 $850 $- $1,600 2024 2025 2026 2027 2028 2029 2030 ≥ 2031 Funded Debt Undrawn Credit Lines Terms: in millions Quarter Highlights Financial Results SBU Results Outlook Importa
Slide 27: Segment Operating Income Reconciliation
SEGMENT OPERATING INCOME RECONCILIATION Three Months Ended Full Year December 31, December 31, 2024 2023 2024 2023 Total Segment Operating Income $ 385 $ 383 $ 1,318 $ 968 Less: Goodwill and Intangible Asset Impairment — 230 125 230 Rationalizations 34 200 86 502 Interest Expense 131 129 522 532 Oth
Slide 28: Reconciliation of Total Debt and Net Debt
RECONCILIATION OF TOTAL DEBT AND NET DEBT Pro forma December 31, September 30, June 30, December 31, 2024 2024 2024 2023 Accounts Receivable $ 2,482 $ 3,380 $ 3,043 $ 2,731 Inventories 3,597 3,812 4,048 3,698 Accounts Payable — Trade (4,052) (4,050) (4,181) (4,326) Working Capital 4 (a) $ 2,027 $ 3,
Slide 29: Reconciliation of Net Leverage
RECONCILIATION OF NET LEVERAGE Terms: in millions Quarter Highlights Financial Results SBU Results Outlook Important Disclosures Appendix Q4 2024 - 29
Slide 30: Reconciliation of Free Cash Flow
RECONCILIATION OF FREE CASH FLOW Terms: in millions Quarter Highlights Financial Results SBU Results Outlook Important Disclosures Appendix Q4 2024 - 30
Slide 31: Reconciliation of Adjusted Net Income and EPS Q4 2024
RECONCILIATION OF ADJUSTED NET INCOME (LOSS) AND ADJUSTED DILUTED EARNINGS PER SHARE FOURTH QUARTER 2024 Rationalizations, Indirect Tax Americas Asset Write-offs, Pension As Goodyear Asset and Settlements Storm As Accelerated Settlement Reported Forward Costs Other Sales and Discrete Insurance Adjus
Slide 32: Reconciliation of Adjusted Net Income and EPS Q4 2023
RECONCILIATION OF ADJUSTED NET INCOME (LOSS) AND ADJUSTED DILUTED EARNINGS PER SHARE FOURTH QUARTER 2023 Terms: in millions, except per share amounts Quarter Highlights Financial Results SBU Results Outlook Important Disclosures Appendix Q4 2024 - 32
Slide 33: Reconciliation of Adjusted Net Income and EPS Full Year 2024
RECONCILIATION OF ADJUSTED NET INCOME (LOSS) AND ADJUSTED DILUTED EARNINGS PER SHARE FULL YEAR 2024 Rationalizations, Indirect Tax Debica Fire Americas Asset Write-offs, Intangible Goodyear South Pension As Settlements and Impact and Asset and Storm As Accelerated Asset Forward Africa Flood Settleme
Slide 34: Reconciliation of Adjusted Net Income and EPS Full Year 2023
RECONCILIATION OF ADJUSTED NET INCOME (LOSS) AND ADJUSTED DILUTED EARNINGS PER SHARE FULL YEAR 2023 Terms: in millions, except per share amounts Quarter Highlights Financial Results SBU Results Outlook Important Disclosures Appendix Q4 2024 - 34
Slide 35: Historical Key Metrics: Income Statement
HISTORICAL KEY METRICS INCOME STATEMENT Terms: Units & $ in millions, except per share amounts Quarter Highlights Financial Results SBU Results Outlook Important Disclosures Appendix Q4 2024 - 35
Slide 36: Historical Key Metrics: Balance Sheet and Cash Flow
HISTORICAL KEY METRICS BALANCE SHEET AND CASH FLOW 4 (b) Terms: in millions Quarter Highlights Financial Results SBU Results Outlook Important Disclosures Appendix Q4 2024 - 36
Slide 37: End Notes
END NOTES 1 Segment Operating Income (SOI) results fourth quarter and full year 2024 versus 2023: (a) Raw materials variance excludes raw material cost saving measures; (b) Goodyear Forward includes cost actions and margin expansion and excludes Goodyear Forward fees; (c) Estimated impact of general
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