Axalta Sets Two Records Ahead of Aug. 5 Merger Vote
Axalta Coating Systems Ltd. reported second-quarter 2026 net sales of $1.35 billion, up 3% from the same period last year, as the company prepares for a shareholder vote on its proposed merger with AkzoNobel.
The coatings manufacturer posted record quarterly adjusted EBITDA of $305 million, a 5% year-over-year increase. Adjusted EBITDA margin rose 30 basis points to 22.7%.
Adjusted diluted earnings per share reached a quarterly record of $0.72, up 13% from $0.64 a year earlier.
“We delivered an excellent second quarter with record Adjusted EBITDA and Adjusted Diluted EPS, expanded margins and strong free cash flow generation demonstrating the earnings power of our business model,” said Chris Villavarayan, Axalta CEO and president.
Net income declined $21 million to $89 million, while diluted earnings per share decreased from $0.50 to $0.41. Axalta attributed the decline primarily to an additional $31 million in merger- and acquisition-related costs.
Adjusted net income, which excludes merger- and acquisition-related expenses and other adjustments, increased 10% to $153 million.
Cash provided by operating activities rose 7% to $152 million. Free cash flow increased 6% to $107 million despite costs associated with the proposed merger.
Performance Coatings Sales Rise 4%
Performance Coatings generated second-quarter sales of $872 million, a 4% increase from the prior-year period. Favorable currency translation, acquisition contributions and positive price mix more than offset slightly lower volumes.
Refinish sales increased 6% to $545 million, supported by acquisitions, pricing and currency effects. Industrial sales rose 2% to $327 million as volume growth in Europe and Asia and favorable price mix offset lower North American volumes.
Performance Coatings adjusted EBITDA increased 10% to $218 million. The segment’s adjusted EBITDA margin improved 130 basis points to 25.1%.
Mobility Coatings Reaches Sales Record
Mobility Coatings reported record quarterly sales of $474 million, up 1% year over year.
Light Vehicle sales declined slightly because of lower organic sales, partially offset by favorable currency translation. Commercial Vehicle sales increased 7%, with volume growth reported across all four regions.
The segment generated adjusted EBITDA of $87 million and an adjusted EBITDA margin of 18.4%. Axalta said stronger Commercial Vehicle volumes were more than offset by favorable one-time items recorded during the second quarter of 2025 that did not recur.
Company Maintains Full-Year Outlook
Axalta expects third-quarter adjusted EBITDA of $295 million to $305 million and adjusted diluted earnings per share of approximately $0.70.
For full-year 2026, the company projects low-single-digit sales growth, adjusted EBITDA of $1.14 billion to $1.17 billion and adjusted diluted earnings per share of $2.55 to $2.70. Axalta expects free cash flow of more than $500 million.
The company ended the quarter with total net leverage of 2.2 times, which it described as the lowest level in its history.
Axalta shareholders are scheduled to vote Aug. 5 on the proposed merger of equals with AkzoNobel.
“We look forward to Axalta’s Special General Meeting on August 5 to approve the compelling merger of equals with AkzoNobel,” Villavarayan said.
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