ATS Automation Tooling Systems, Inc. (ATSAF) Q2 2023 Earnings Conference Call November 9, 2022 8:30 AM ET

Company Participants

David Galison - Head, IR

Andrew Hider - CEO & Director

Ryan McLeod - CFO

Conference Call Participants

Mark Neville - Scotiabank

David Ocampo - Cormark Securities

Justin Keywood - Stifel

Maxim Sytchev - National Bank Financial

Sabahat Khan - RBC Capital Markets

Operator

Good morning, ladies and gentlemen, and welcome to the ATS Automation Second Quarter Conference Call and Webcast. This call is being recorded on November 9, 2022 at 8:30 a.m. Eastern time. [Operator Instructions].

I will now turn the call over to David Galison, Head of Investor Relations at ATS.

David Galison

Thank you, operator, and good morning, everyone. On the call today are Andrew Hider, Chief Executive Officer of ATS; and Ryan McLeod, Chief Financial Officer. Please note that our remarks today are accompanied by a slide deck, which can be viewed via our webcast and available at atsautomation.com. We caution that the statements made on the webcast and conference call may contain forward-looking information and our cautionary statement regarding such information, including the material factors that could cause actual results to differ materially from the statements and the material factors or assumptions applied in making these statements are detailed on Slide 2 of the slide deck.

Now it's my pleasure to turn the call over to Andrew.

Andrew Hider

Thank you, David. Good morning, ladies and gentlemen, and thank you for joining us. Today, ATS reported another quarter of record order bookings and backlog. The business delivered solid revenues and adjusted earnings in line with our expectations, even as supply chain delays and cost increases continue to present significant challenges. The macro environment is still challenging, and we remain committed to profitable growth, underpinned by our disciplined approach to strategic markets and focus on mitigating risks and driving continuous improvement through our ABM.

During the quarter, we made on planned progress in integrating recent acquisitions. Notably, customer interest is developing for solutions that combine the capabilities of SP, Comecer, and BioDot, and along with it, potential access to new submarkets. Today, I will update you on the business and Ryan will provide his financial report.

Starting with our financial value drivers. Q2 revenues were $589 million, up 13% from Q2 last year, driven by a combination of acquired businesses and continued strength across our core operations. Organic revenue growth was 4% year-over-year. Order bookings for the quarter were $804 million, up 58% year-over-year. This quarter, we booked the single largest order in ATS' history, $167 million in the EV market. In addition, as we announced last week, we received further follow-on EV orders valued at $140 million, which are part of the same multiphase enterprise program. Our adjusted EBIT margin in Q2 was 12.8%. Today, we also announced a plan to enhance our cost structure and efficiency. Ryan will provide more information in his remarks.