CTS Corporation (NYSE:CTS) Q2 2024 Earnings Conference Call July 30, 2024 10:00 AM ET

Company Participants

Kieran O'Sullivan - President & CEO
Ashish Agrawal - CFO

Conference Call Participants

Joshua Buchalter - TD Cowen
John Franzreb - Sidoti & Company
Hendi Susanto - Gabelli Funds

Operator

Good morning or good afternoon, all. Welcome to the CTS Corporation Second Quarter 2024 Conference Call. My name is Adam, and I will be your operator today. [Operator Instructions]

I’ll now hand the floor to CEO, Kieran O'Sullivan to begin. So Kieran, please go ahead when you're ready.

Kieran O'Sullivan

Thanks, Adam. Good morning, and thank you for joining our second quarter 2024 earnings call. We achieved earnings in line with our expectations despite softness in the transportation end market. CTS is focused on future growth through continued diversification of our customer base and end markets. Yesterday, we completed the acquisition of SyQwest, LLC, a leading designer and manufacturer of sonar and underwater acoustic sensing and electronic solutions, primarily for the U.S. naval defense market.

SyQwest's products enable the sonar systems that guide and protect our submarines and surface ships. We extend a warm welcome to Bob Tarini and the SyQwest team, and look forward to leveraging our combined capabilities to drive growth in defense. The acquisition is expected to be accretive in 2025.

Ashish will take us through the safe harbor statement. Ashish?

Ashish Agrawal

I would like to remind our listeners that this conference call contains forward-looking statements. These statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Additional information regarding these risks and uncertainties is contained in the press release issued today, and more information can be found in the company's SEC filings.

To the extent that today's discussion refers to any non-GAAP measures under Regulation G, the required explanations and reconciliations are available with today's earnings press release and supplemental slide presentation, which can be found in the Investors section of the CTS website.

I will now turn the discussion back to our CEO, Kieran O'Sullivan.

Kieran O'Sullivan

Thanks, Ashish. We finished the second quarter with sales of $130 million, a decline of 10% from the second quarter of 2023. For the quarter, non-transportation sales were up 4%, and transportation sales were down 22% from the same period last year. Sequentially, non-transportation sales were up 11%, sales to the transportation end market were down 3% versus the first quarter of 2024. Non-transportation sales were 51% of overall company revenue in the second quarter.