PHINIA INC.
For the period ended Oct 29, 2026. Filed Oct 29, 2026.
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Oct 29, 2026 · Filed Oct 29, 2026
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Contents
EX-99.1 · Net Leverage
Net Leverage
The Company defines net leverage as net debt divided by trailing twelve-month Adjusted EBITDA. Management believes this measure is useful to investors in assessing the Company’s leverage profile and ability to service its debt obligations.
| Adjusted EBITDA and EBITDA Margin (Unaudited) | ||||
|---|---|---|---|---|
| (in millions) | ||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
| 2026 | 2025 | 2026 | 2025 | |
| Net earnings | $67 | $13 | $144 | $85 |
| Depreciation and tooling amortization | 33 | 32 | 98 | 94 |
| Interest expense | 21 | 20 | 62 | 60 |
| Provision for income taxes | 3 | 6 | 50 | 59 |
| Amortization of acquisition-related intangibles | 8 | 8 | 24 | 22 |
| Interest income | (2) | (3) | (6) | (11) |
| EBITDA | 130 | 76 | 372 | 309 |
| Restructuring expense | 5 | 4 | 16 | 11 |
| Merger and acquisition costs2 | 2 | 4 | 5 | 9 |
| Losses (gains) for other one-time events | 1 | (2) | 1 | (2) |
| Separation-related costs1 | 2 | 53 | 3 | 43 |
| Other postretirement (income) expense, net | (1) | 1 | (4) | 3 |
| Equity in affiliates’ earnings, net of tax | (4) | (3) | (13) | (11) |
| Adjusted EBITDA | $135 | $133 | $380 | $362 |
| Net sales | $912 | $908 | $2,730 | $2,594 |
| Adjusted EBITDA margin % | 14.8% | 14.6% | 13.9% | 14.0% |
| Net Earnings to Adjusted Net Earnings (Unaudited) | ||||
|---|---|---|---|---|
| (in millions) | ||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
| 2026 | 2025 | 2026 | 2025 | |
| Net earnings | $67 | $13 | $144 | $85 |
| Amortization of acquisition-related intangibles | 8 | 8 | 24 | 22 |
| Restructuring expense | 5 | 4 | 16 | 11 |
| Merger and acquisition expense2 | 2 | 4 | 5 | 9 |
| Losses (gains) for other one-time events | 1 | (2) | 1 | (2) |
| Separation-related costs1 | 2 | 53 | 3 | 43 |
| Tax effects and adjustments | (17) | (17) | (17) | (15) |
| Adjusted net earnings | $68 | $63 | $176 | $153 |
| Adjusted Net Earnings Per Diluted Share (Unaudited) | ||||
|---|---|---|---|---|
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
| 2026 | 2025 | 2026 | 2025 | |
| Net earnings per diluted share | $1.80 | $0.33 | $3.79 | $2.10 |
| Amortization of acquisition-related intangibles | 0.22 | 0.20 | 0.63 | 0.55 |
| Restructuring expense | 0.13 | 0.10 | 0.42 | 0.27 |
| Merger and acquisition expense2 | 0.05 | 0.10 | 0.13 | 0.22 |
| Losses (gains) for other one-time events | 0.03 | (0.05) | 0.03 | (0.05) |
| Separation-related costs1 | 0.05 | 1.34 | 0.08 | 1.07 |
| Tax effects and adjustments | (0.45) | (0.43) | (0.44) | (0.37) |
| Adjusted net earnings per diluted share | $1.83 | $1.59 | $4.64 | $3.79 |
| Adjusted Free Cash Flow (Unaudited) | ||||
|---|---|---|---|---|
| (in millions) | ||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
| 2026 | 2025 | 2026 | 2025 | |
| Net cash provided by operating activities | $87 | $119 | $231 | $216 |
| Capital expenditures, including tooling outlays | (17) | (26) | (71) | (95) |
| Effects of separation-related transactions | 3 | 11 | 29 | — |
| Adjusted free cash flow | $73 | $104 | $189 | $121 |
1 Separation-related costs primarily relate to indemnities related to the Tax Matters Agreement between the Company and its former parent, and professional fees and other costs associated with the spin-off of the Company from its former parent, including the adjustment of certain historical liabilities allocated to the Company in connection with the spin-off.
2 Merger and acquisition expense primarily relate to professional fees for acquisition initiatives.
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