DENVER - Gates Industrial (NYSE:GTES) Corporation plc (NYSE: GTES), a global manufacturer of power transmission and fluid power solutions, announced today that certain selling stockholders affiliated with Blackstone (NYSE:BX) Inc. have initiated a secondary offering of 11,635,224 ordinary shares. The company itself is not offering any shares and will not receive any proceeds from the sale.
Goldman Sachs (NYSE:GS) & Co. LLC is acting as the book-running manager for the offering. Details of the offering are included in the registration statement and prospectus filed with the Securities and Exchange Commission (SEC), which investors are encouraged to read for more comprehensive information about Gates and the offering. These documents are available for free on the SEC's website through the EDGAR system, or by request from Goldman Sachs & Co. LLC.
The press release specifies that this announcement is not an offer to sell or a solicitation of an offer to buy the securities, and the securities will not be sold in any jurisdiction where such offer, solicitation, or sale would be illegal before registration or qualification under the securities laws of such jurisdiction.
Gates operates in various sectors of the industrial and consumer markets, with products sold in over 130 countries. The company's offerings are essential in a wide array of applications in numerous end markets, including transportation.
The press release also contains forward-looking statements that involve risks and uncertainties, cautioning that actual results may differ materially from those projected. Gates does not commit to updating any forward-looking statements except as required by law. The company's filings with the SEC provide further detail on these risks and uncertainties.
This news article is based on a press release statement from Gates Industrial Corporation plc .
In other recent news, Gates Industrial Corporation reported a slight decrease in core sales of 3.8%, amounting to $831 million, in the third quarter of 2024. Despite this, the company's gross margin experienced an increase, and the adjusted earnings per share (EPS) guidance was raised. The company also returned $125 million to shareholders via share repurchases. The management, including CEO Ivo Jurek and CFO Brooks Mallard, expressed optimism for the future, particularly in the Chinese market and the automotive replacement sector.
Strategies such as footprint optimization and inventory management were discussed as measures to drive growth and profitability. The company anticipates $40 million in annualized savings from the footprint optimization plan by the end of 2025. Gates Industrial also mentioned the potential for future mergers and acquisitions, while prioritizing stock buybacks.
Despite the decrease in core sales, the company achieved a record Q3 gross margin and expects a 100 basis point improvement in adjusted EBITDA margin in 2024. The company also plans to maintain operational capacity and high inventory levels in preparation for demand growth. These recent developments indicate Gates Industrial's commitment to navigating complex market environments and driving future growth.
InvestingPro Insights
Gates Industrial Corporation plc (NYSE: GTES) has shown impressive market performance, with a year-to-date price total return of 43.82% and a one-year return of 76.74% as of the latest data. This strong performance aligns with one of the InvestingPro Tips, which highlights the company's high return over the last year.
The company's current market capitalization stands at $4.9 billion, with a P/E ratio of 25.48. Despite the robust stock performance, Gates Industrial faces some challenges. An InvestingPro Tip points out that the company suffers from weak gross profit margins. However, this is somewhat offset by a solid operating income margin of 30.11% for the last twelve months as of Q3 2024.
Interestingly, Gates Industrial has achieved a perfect Piotroski Score of 9, according to another InvestingPro Tip. This score suggests strong financial health and potential for future growth, which could be reassuring for investors considering the secondary offering announced by the company.
For those seeking a more comprehensive analysis, InvestingPro offers additional tips and insights on Gates Industrial. There are 5 more InvestingPro Tips available, which could provide valuable context for understanding the company's financial position and future prospects.
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