Garrett Motion Inc

Previous wording

The following MD&A is intended to help you understand the results of operations and financial condition of Garrett Motion Inc. for the three and six months ended June 30, 2024.

Current wording

The following MD&A is intended to help you understand the results of operations and financial condition of Garrett Motion Inc. for the three and nine months ended September 30, 2024.

Previous wording

For the three months ended June 30, 2024, we repurchased $65 million of Common Stock under our share repurchase program. As of June 30, 2024, we had $176 million of the authorized amount remaining under our share repurchase program.

Current wording

For the three and nine months ended September 30, 2024, we repurchased $52 million and $226 million, respectively, of Common Stock under our share repurchase program. As of September 30, 2024, we had $124 million of the authorized amount remaining under our share repurchase program.

Previous wording

During the second quarter, we completed an offering of $800 million in aggregate principal amount of 7.75% 2032 Senior Notes and made early debt repayments totaling $985 million on our Euro Term Facility and 2023 Dollar Term Facility, both of which were fully repaid as of June 30, 2024.

Current wording

Also as previously disclosed, during the second quarter, we completed an offering of $800 million in aggregate principal amount of 7.75% 2032 Senior Notes and made early debt repayments totaling $985 million on our Euro Term Facility and 2023 Dollar Term Facility, both of which were fully repaid as of June 30, 2024.

Previous wording

The following tables show our revenues by geographic region and product line for the three and six months ended June 30, 2024 and 2023, respectively.

Current wording

The following tables show our revenues by geographic region and product line for the three and nine months ended September 30, 2024 and 2023, respectively.

Previous wording

Aftermarket sales increased by $7 million or 6% (including a unfavorable impact of $1 million or 1% due to foreign currency translation), primarily due to favorable aftermarket conditions and demand for replacement parts in China, North America, and Europe, partially offset by softer sales in Australia.

Current wording

Aftermarket sales decreased by $1 million or 1% (including a favorable impact of $1 million or 0% due to foreign currency translation), primarily due to softer sales in North America, partially offset by favorable aftermarket conditions and demand for replacement parts in Asia and Europe.

Previous wording

For the six months ended June 30, 2024, net sales compared to prior year decreased by $176 million or 9% (including an unfavorable impact of $26 million or 1%), due to foreign currency translation driven by lower Chinese yuan-to-US dollar and lower Japanese yen-to-US dollar exchange rates. This decrease was mainly driven by demand softness in gasoline, diesel, and commercial vehicle applications, and commodity deflation impact on pricing net of inflation pass-through, partially offset by increased demand for replacement parts on aftermarket sales and favorable product mix.

Current wording

For the nine months ended September 30, 2024, net sales compared to prior year decreased by $310 million or 11% (including an unfavorable impact of $25 million or 1% due to foreign currency translation primarily driven by lower Chinese Yuan-to-US dollar and Japanese Yen-to-US dollar exchange rates, partially offset by higher Euro-to-US dollar exchange rates) primarily due to demand softness in gasoline, diesel, and commercial vehicle applications across all regions and pricing decreases, net of inflation pass-through, driven by commodity deflation, partially offset by higher demand for replacement parts on aftermarket sales and favorable product mix.

Previous wording

Gasoline product sales decreased by $95 million or 11% (including an unfavorable impact of $14 million or 2% due to foreign currency translation), primarily driven by soft demand in China and North America partially offset by program ramp-ups in Europe, Japan, and India.

Current wording

Gasoline product sales decreased by $176 million or 14% (including an unfavorable impact of $13 million or 1% due to foreign currency translation), primarily driven by soft demand in China and North America partially offset by program ramp-ups in Europe, Japan, and India.

Previous wording

Diesel product sales decreased by $40 million or 15% (including an unfavorable impact of $4 million or 1% due to foreign currency translation), primarily driven by demand softness for passenger vehicles in Europe, partially offset by sustained demand for light commercial vehicles in China and North America.

Current wording

Diesel product sales decreased by $110 million or 15% (including an unfavorable impact of $3 million or 1% due to foreign currency translation), primarily driven by passenger vehicles in Europe, partially offset by sustained demand for pickup trucks in North and South America.

Previous wording

Commercial vehicle sales decreased by $7 million or 4% (including an unfavorable impact of $4 million or 2% due to foreign currency translation), primarily driven by soft demand in the construction and agriculture industries due to high interest rates and lower crop prices. This decrease was partially offset by sustained demand in China, linked to ramp-up of compressed natural gas programs.

Current wording

Commercial vehicle sales decreased by $30 million or 6% (including an unfavorable impact of $7 million or 1% due to foreign currency translation), primarily driven by construction and agriculture industry softness due to high interest rates and lower crop prices, partially offset by sustained demand in the on-highway industry, especially in China, with natural gas programs applications.

Previous wording

Aftermarket sales increased by $9 million or 4% (including a unfavorable impact of $2 million or 1% due to foreign currency translation), primarily due to favorable aftermarket conditions and the continued high demand for replacement parts in Europe, China, and North America, partially offset by softer sales in Australia.

Current wording

Aftermarket sales increased by $8 million or 2% (including an unfavorable impact of $1 million or 1% due to foreign currency translation), primarily due to favorable aftermarket conditions and continued high demand for replacement parts in Europe, China, and North America, partially offset by softer sales in other Asian countries.

Previous wording

For the three months ended June 30, 2024, cost of goods sold decreased by $104 million, primarily driven by $78 million of lower sales volumes, $27 million of commodity, transportation, and energy deflation, $18 million of productivity, net of labor inflation, and $9 million from foreign currency impacts. These decreases were partially offset by $26 million of unfavorable product mix and $2 million of higher R&D costs, reflecting Garrett's continued investment in new technologies.

Current wording

For the three months ended September 30, 2024, cost of goods sold decreased by $124 million, primarily driven by $113 million of lower sales volumes, $16 million of commodity, transportation, and energy deflation, and $38 million of productivity, net of labor inflation. These decreases were partially offset by $32 million of unfavorable product mix, $6 million of higher R&D costs, reflecting Garrett's continued investment in new technologies, and $5 million from foreign currency impacts.

Previous wording

For the three months ended June 30, 2024, gross profit decreased by $17 million, primarily driven by $34 million of lower sales volumes, $22 million from commodity deflation impact on pricing, net of inflation pass-through, $2 million of higher R&D costs, and $9 million from foreign currency impacts. These decreases were partially offset by $27 million of commodity, transportation, and energy deflation, $21 million of productivity, net of labor inflation, and $2 million of favorable product mix.

Current wording

For the three months ended September 30, 2024, gross profit decreased by $10 million, primarily driven by $46 million of lower sales volumes, $13 million from commodity deflation impacts on pricing, net of inflation pass-through, $6 million of higher R&D costs, and $4 million from foreign currency impacts. These decreases were partially offset by $16 million of commodity, transportation, and energy deflation, $33 million of productivity, net of labor inflation, and $10 million of favorable product mix.

Previous wording

For the six months ended June 30, 2024, cost of goods sold decreased by $142 million, primarily driven by lower sales volumes of $107 million, $44 million of commodity, transportation, and energy deflation, and $29 million of productivity, net of labor inflation and repositioning costs, and $9 million from foreign currency impacts. These decreases were partially offset by $43 million unfavorable product mix and $4 million of higher R&D costs, reflecting Garrett's continued investment in new technologies.

Current wording

For the nine months ended September 30, 2024, cost of goods sold decreased by $266 million, primarily driven by lower sales volumes of $220 million, $60 million of commodity, transportation, and energy deflation, $67 million of productivity, net of labor inflation and repositioning costs, and $4 million from foreign currency impacts. These decreases were partially offset by $75 million unfavorable product mix and $10 million of higher R&D costs, reflecting Garrett's continued investment in new technologies.

Previous wording

For the six months ended June 30, 2024, gross profit decreased by $34 million, primarily driven by $46 million of lower sales, $38 million from commodity deflation impact on pricing net of inflation pass-through, $17 million favorable foreign currency impact, $9 million of unfavorable product mix, and $4 million of higher R&D costs. These decreases were partially offset by $44 million of commodity, transportation, and energy deflation and $36 million of higher productivity, net of labor inflation and repositioning costs.

Current wording

For the nine months ended September 30, 2024, gross profit decreased by $44 million, primarily driven by $92 million of lower sales volumes, $51 million from commodity deflation impact on pricing net of inflation pass-through, $21 million favorable foreign currency impact, and $10 million of higher R&D costs. These decreases were partially offset by $60 million of commodity, transportation, and energy deflation and $69 million of higher productivity, net of labor inflation and repositioning costs and $1 million of favorable product mix.

Previous wording

Selling, general and administrative (“SG&A”) expenses for the three months ended June 30, 2024 decreased by $2 million compared with the prior year, mainly driven by $4 million of lower professional service fees partially offset by $2 million of higher bad debt expense. SG&A expenses also decreased due to $1 million of favorable foreign exchange impact.

Current wording

Selling, general and administrative (“SG&A”) expenses for the three months ended September 30, 2024 decreased by $6 million compared with the prior year, mainly driven by $5 million of lower professional service and legal fees, $2 million of lower bad debt expense and $2 million of lower IT-related costs. These decreases were partially offset by $2 million of higher repositioning costs and $1 million of unfavorable foreign exchange impact.

Previous wording

SG&A expenses for the six months ended June 30, 2024 increased by $6 million compared with the prior year, primarily due to $5 million of higher stock-based compensation expense, $2 million of higher bad debt expense, and $1 million of labor inflation impacts. These increases were partially offset by $2 million of lower professional service fees.

Current wording

SG&A expenses for the nine months ended September 30, 2024 were consistent with the prior year. Year over year variances are primarily related to $5 million of higher stock-based compensation expense and $2 million of higher repositioning costs. These increases were offset by $6 million of lower professional service and legal fees and $2 million of lower IT-related costs. SG&A expenses also increased due to $1 million of unfavorable exchange impact.

Previous wording

For the three months ended June 30, 2024, interest expense increased by $33 million compared to the prior year. This was primarily driven by $27 million of accelerated debt issuance cost amortization and $3 million of higher interest expense due to a different notional amount of debt outstanding during the period and higher variable interest rates, partially offset by the spread reduction on the 2021 Dollar Term Facility. In addition, there were $25 million of marked-to-market remeasurement losses recorded during the three months ended June 30, 2024 on our undesignated interest rate swap contracts, partially offset by $22 million of gains, including settlements of $18 million, on our interest derivatives in the current year.

Current wording

For the three months ended September 30, 2024, interest expense decreased by $11 million compared to the prior year, primarily driven by $10 million lower of debt issuance cost amortization and $9 million of lower interest expense due to a different notional amount of debt outstanding during the period. In addition, we recorded $4 million of gains on our interest derivatives in the current year, in comparison to $7 million of gains in the prior year. We also recognized $9 million of marked-to-market remeasurement losses during the three months ended September 30, 2024 on our undesignated interest rate swap contracts, in comparison to $5 million of marked-to-market remeasurement losses in the prior year.

Previous wording

For the six months ended June 30, 2024, interest expense increased by $37 million compared to the prior year. This was primarily driven by $27 million of accelerated debt issuance cost amortization, $12 million of interest expense on our 2023 Dollar Term Facility versus none in the first six months of 2023, as well as $7 million of interest expense related to our 2032 Senior Notes. These increases in interest expense were partially offset by $28 million of gains, including settlements of $18 million, on our interest derivatives in the current year. In addition, there were $24 million marked-to-market remeasurement losses recorded during the six months ended June 30, 2024 on our undesignated interest rate swap contracts, in comparison to $5 million of marked-to-market remeasurement losses in the prior year.

Current wording

For the nine months ended September 30, 2024, interest expense increased by $26 million compared to the prior year, primarily driven by $17 million of higher accelerated debt issuance cost amortization, and $10 million of higher interest expense related to our 2032 Senior Notes partially offset by lower interest expense related to our 2023 Dollar Term Facility. In addition, we recorded $23 million of gains, net of settlements of $18 million, on our interest derivatives in the current year, in comparison to $18 million of gains in the prior year. We also recognized $33 million of marked-to-market remeasurement losses during the nine months ended September 30, 2024 on our undesignated interest rate swap contracts, in comparison to $12 million of marked-to-market remeasurement losses in the prior year.

Previous wording

For the three months ended June 30, 2024, we had non-operating income of $1 million versus non-operating expense of $8 million in the prior year. The increase in non-operating income was primarily driven by foreign exchange transactional gains, partially offset by $2 million of lower equity income due to sale of an equity interest in an unconsolidated joint venture.

Current wording

For the three months ended September 30, 2024, we had non-operating income of $1 million versus $2 million in the prior year, primarily driven by lower equity income due to the sale of an equity interest in an unconsolidated joint venture.

Previous wording

For the six months ended June 30, 2024, we had non-operating income of $6 million versus an expense of $5 million in the prior year. The increase in non-operating income was primarily driven by foreign exchange transactional gains, partially offset by $2 million of lower equity income due to sale of an equity interest in an unconsolidated joint venture.

Current wording

For the nine months ended September 30, 2024, we had non-operating income of $7 million versus an expense of $3 million in the prior year, primarily driven by foreign exchange transactional gains, partially offset by $2 million of lower equity income due to the sale of an equity interest in an unconsolidated joint venture.

Previous wording

The effective tax rates for thethree months ended June 30, 2024 and 2023 were 26.4% and 29.7%, respectively. The effective tax rates for the six months ended June 30, 2024 and 2023 were 22.5% and 27.3%, respectively.

Current wording

The effective tax rates for thethree months ended September 30, 2024 and 2023 were 31.6% and 18.6%, respectively. The effective tax rates for thenine months ended September 30, 2024 and 2023 were 25.4% and 25.1%, respectively.

Previous wording

The change in the effective tax rate for the three months ended June 30, 2024 compared to the prior period is primarily related to lower U.S. taxes on international operations and lower non-deductible transaction costs, partially offset by tax related to the sale of an equity interest in an unconsolidated joint venture.

Current wording

The change in the effective tax rate for the three months ended September 30, 2024 compared to the prior period is primarily related to global mix of earnings, partially offset by adjustments to tax reserves due to expiration of statute of limitations.

Previous wording

The change in the effective tax rate for the six months ended June 30, 2024 compared to the prior period is primarily related to reversal of tax reserves, lower U.S. taxes on international operations, and lower non-deductible transaction costs, partially offset by tax related to the sale of an equity interest in an unconsolidated joint venture.

Current wording

The change in the effective tax rate for the nine months ended September 30, 2024 compared to the prior period is primarily related to global mix of earnings and tax expense related to the sale of an equity interest in an unconsolidated joint venture, partially offset by reversal of tax reserves and lower non-deductible transaction costs.

Previous wording

In January 2019, the Organization for Economic Co-operation and Development (“OECD”) announced further work in continuation of its Base Erosion and Profit Shifting project, focusing on two “pillars.” Pillar One provides a framework for the reallocation of certain residual profits of multinational enterprises to market jurisdictions where goods or services are used or consumed. Pillar Two consists of two interrelated rules referred to as Global Anti-Base Erosion (“GloBE”) Rules, which operate to impose a minimum tax rate of 15% calculated on a jurisdictional basis. On December 20, 2021, the OECD published GloBE model rules and released multiple rounds of commentary on those rules over the subsequent months. More than 135 OECD member countries have agreed to the key parameters of the model rules, which allow those OECD member countries to begin implementing the GloBE rules in a manner consistent with the agreement reached. The rules were adopted by a number of countries in 2023, with an effective date for fiscal years beginning after December 31, 2023.

Current wording

In January 2019, the Organization for Economic Co-operation and Development (“OECD”) announced further work in continuation of its Base Erosion and Profit Shifting project, focusing on two “pillars.” Pillar One provides a framework for the reallocation of certain residual profits of multinational enterprises to market jurisdictions where goods or services are used or consumed. Pillar Two consists of two interrelated rules referred to as Global Anti-Base Erosion (“GloBE”) Rules, which operate to impose a minimum tax rate of 15% calculated on a jurisdictional basis. On December 20, 2021, the OECD published GloBE model rules and released multiple rounds of commentary on those rules over the subsequent months. More than 135 OECD member countries have agreed to the key parameters of the model rules, which allow those OECD member countries to begin implementing the GloBE rules in a manner consistent with the agreement reached. The rules were adopted by a number of countries, with an effective date for fiscal years beginning after December 31, 2023.

Previous wording

Net income for the six months ended June 30, 2024 decreased by $22 million compared with the prior year, primarily due to $34 million of decreased gross profit, $37 million of higher interest expense, and $6 million of higher SG&A expenses. These decreases were partially offset by a $27 million gain on the sale of equity interest in an unconsolidated joint venture, $11 million of higher non-operating income, and $19 million of lower tax expense.

Current wording

Net income for the three months ended September 30, 2024 decreased by $5 million compared with the prior year, primarily due to $10 million of decreased gross profit and $11 million of higher tax expense. These decreases were partially offset by $11 million of lower interest expense and $6 million of lower SG&A expense.

Previous wording

Net income for the three months ended June 30, 2024 decreased by $7 million compared with the prior year, primarily due to $17 million of decreased gross profit and $33 million of higher interest expense. These decreases were partially offset by a $27 million gain on the sale of equity interest in an unconsolidated joint venture, $9 million of higher non-operating income, and $7 million of lower tax expense.

Current wording

Net income for the nine months ended September 30, 2024 decreased by $27 million compared with the prior year, primarily due to $44 million of decreased gross profit and $26 million of higher interest expense. These decreases were partially offset by a $27 million gain on the sale of an equity interest in an unconsolidated joint venture, $10 million of higher non-operating income, and $8 million of lower tax expense.

Previous wording

We evaluate performance on the basis of EBITDA and Adjusted EBITDA. We define “EBITDA” as our net income calculated in accordance with U.S. GAAP, plus the sum of interest expense net of interest income, tax expense and depreciation. We define “Adjusted EBITDA” as EBITDA, plus the sum of stock compensation expense, repositioning costs, foreign exchange (gain) loss on debt net of related hedging gains, discounting costs on factoring, gain on sale of equity investment, acquisition and divestiture expenses, other non-operating income, capital structure transformation expenses, debt refinancing and redemption costs, net reorganization items and loss on extinguishment of debt (if any).

Current wording

We evaluate performance on the basis of EBITDA and Adjusted EBITDA. We define “EBITDA” as our net income calculated in accordance with U.S. GAAP, plus the sum of interest expense net of interest income, tax expense and depreciation. We define “Adjusted EBITDA” as EBITDA, plus the sum of stock compensation expense, repositioning costs, foreign exchange (gain) loss on debt net of related hedging gains, discounting costs on factoring, gain on sale of equity investment, acquisition and divestiture expenses, other non-operating income, capital structure transformation expenses, debt refinancing and redemption costs, net reorganization items and loss on extinguishment of debt (if any). Adjusted EBITDA now also adjusts for acquisition and divestiture expenses, and debt refinancing and redemption costs, but no adjustments were made to the prior period as there were no similar adjustments in the prior periods. We believe that EBITDA and Adjusted EBITDA are important indicators of operating performance and provide useful information for investors because:

Previous wording

(1)Reflects interest income of $1 million and $5 million for the three months ended June 30, 2024 and 2023, respectively, and $3 million and $5 million for the six months ended June 30, 2024 and 2023, respectively.

Current wording

(1)Reflects interest income of $0 million and $1 million for the three months ended September 30, 2024 and 2023, respectively, and $3 million and $6 million for the nine months ended September 30, 2024 and 2023, respectively.

Previous wording

For thethree months ended June 30, 2024, net income decreased by$7 million versus the prior year as discussed above within Results of Operations for Three and Six Months Ended June 30, 2024.

Current wording

For thethree months ended September 30, 2024, net income decreased by$5 million versus the prior year as discussed above within Results of Operations for Three and Nine Months Ended September 30, 2024.

Previous wording

Adjusted EBITDA decreased by$37 million compared to the prior year, mainly due to soft demand across product lines except aftermarket, pricing net of inflation pass-through, and unfavorable foreign exchange impacts and unfavorable product mix. These decreases were partially offset by strong operational performance through productivity, net of labor inflation, and repositioning costs, as well as commodity, transportation, and energy deflation.

Current wording

Adjusted EBITDA decreased by$8 million compared to the prior year, mainly due to lower volumes, as discussed above, commodity deflation impact on pricing net of inflation pass-through as well as unfavorable foreign exchange impacts. These decreases were partially offset by strong operational performance through productivity, net of labor inflation, as well as commodity, transportation, and energy deflation, and a favorable product mix.

Previous wording

During the three months ended June 30, 2024, we saw soft demand for gasoline, diesel, and commercial vehicle applications, partially offset by favorable demand in aftermarket for replacement parts in North America, China, and Europe. Net sales also decreased due to pricing, net of inflation pass-through, driven by commodity deflation.

Current wording

During the three months ended September 30, 2024, we saw soft demand for gasoline and diesel, driven byregional industry and customer mix headwinds, partially offset by favorable demand in aftermarket for replacement parts. Net sales also decreased due to pricing, net of inflation pass-through, driven by commodity deflation.

Previous wording

The increased productivity from our ability to flex our variable cost structure, while driving sustained fixed cost productivity was partially offset by year-over-year labor inflation and lower equity income following the sale of an equity interest in an unconsolidated joint venture on April 3, 2024.

Current wording

The increased productivity from our ability to flex our variable cost structure, while driving sustained fixed cost productivity, was partially offset by year-over-year labor inflation and lower equity income following prior quarter's sale of an equity interest in an unconsolidated joint venture.

Previous wording

R&D expenses increased $2 million, reflecting our continued investment in new technologies and increased hiring to accelerate growth in the zero emission technologies.

Current wording

R&D expenses increased $6 million, reflecting our continued investment in new technologies and increased hiring to accelerate growth in the zero emission technologies.

Previous wording

Losses in foreign currency from translational, transactional, and hedging effects in the three months ended June 30, 2024, primarily driven by a lower Euro-to-US dollar, lower Chinese yuan-to-US dollar and lower Japanese yen-to-US dollar exchange rates versus the prior year period, accounted for a $7 million decrease in Adjusted EBITDA.

Current wording

Losses in foreign currency from translational, transactional, and hedging effects in the three months ended September 30, 2024, primarily driven by lower Euro-to-US dollar, Chinese Yuan-to-US dollar and Japanese Yen-to-US dollar exchange rates versus the prior year period, accounted for a $4 million decrease in Adjusted EBITDA.

Previous wording

Adjusted EBITDA for the Six Months Ended June 30, 2024

Current wording

Adjusted EBITDA for the Nine Months Ended September 30, 2024

Previous wording

For thesix months ended June 30, 2024, net income decreased by$22 million versus the prior year as discussed above within Results of Operations for Three and Six Months Ended June 30, 2024.

Current wording

For thenine months ended September 30, 2024, net income decreased by$27 million versus the prior year as discussed above within Results of Operations for Three and Nine Months Ended September 30, 2024.

Previous wording

Adjusted EBITDA decreased by$20 million compared to the prior year, mainly due to soft demand across product lines except aftermarket, pricing net of inflation pass-through, and unfavorable foreign exchange impacts. These decreases were partially offset by strong operational performance through productivity, net of labor inflation, as well as commodity, transportation, and energy deflation, and a slightly favorable product mix.

Current wording

Adjusted EBITDA decreased by$45 million compared to the prior year, mainly due to soft demand across all product lines except aftermarket, pricing net of inflation pass-through, and unfavorable foreign exchange impacts. These decreases were partially offset by strong operational performance through productivity, net of labor inflation, as well as commodity, transportation, and energy deflation.

Previous wording

During thesix months ended June 30, 2024, we saw demand softness for gasoline, diesel, and commercial vehicle applications, partially offset by favorable demand in aftermarket for replacement parts in North America, China, and Europe. Net sales also decreased due to pricing decreases, net of inflation pass-through, driven by commodity price decreases.

Current wording

During thenine months ended September 30, 2024, we saw demand softness for gasoline, diesel, and commercial vehicle applications, driven by challenging regional dynamics and customer mix headwinds, partially offset by favorable demand in aftermarket for replacement parts. Net sales also decreased due to pricing decreases, net of inflation pass-through, driven by commodity price decreases.

Previous wording

R&D expenses increased $4 million, reflecting our continued investment in new technologies, and increased hiring to accelerate growth in the zero emission technologies.

Current wording

R&D expenses increased $10 million, reflecting our continued investment in new technologies and increased hiring to accelerate growth in the zero emission technologies.

Previous wording

Losses in foreign currency from translational, transactional, and hedging effects in thesix months ended June 30, 2024, primarily driven by a lower Chinese yuan-to-US dollar and lower Japanese yen-to-US dollar exchange rates and partially offset by higher Euro-to-US dollar exchange rates versus the prior year period, accounted for a $14 million decrease in Adjusted EBITDA.

Current wording

Losses in foreign currency from translational, transactional, and hedging effects in thenine months ended September 30, 2024, primarily driven by lower Chinese Yuan-to-US dollar and Japanese Yen-to-US dollar exchange rates and partially offset by higher Euro-to-US dollar exchange rates versus the prior year period, accounted for a $18 million decrease in Adjusted EBITDA.