Abc Technologies Holdings Inc
TSX:ABCT
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Abc Technologies Holdings Inc
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Greetings, and welcome to ABC Technologies Q3 Fiscal 2022 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.
I would now like to turn the conference over to your host, Nathan Barton, VP, Investor Relations. Thank you, sir. You may begin.
Thank you, operator, and thanks, everyone, for joining us today for ABC Technologies Q3 fiscal 2022 earnings conference call. With me on the call are Todd Sheppelman, President and Chief Executive Officer of ABC Technologies; and David Smith, Chief Financial Officer of ABC Technologies. This call is being webcast live on ABC Technologies Investor Relations website, and the webcast and accompanying slides will be available for replay for 12 months following this call. The content of today's call is the property of ABC Technologies. It can't be reproduced or transcribed without prior written consent from the company.
Before we begin, I would like to remind you that today's call will include forward-looking statements within the meaning of applicable securities laws, which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. Any such statements should be considered in conjunction with our cautionary statements in our earnings release and risk factor discussions in our filings with the Canadian securities regulatory authorities on SEDAR. Please refer to Slide 2 of the presentation for additional information. We assume no obligation to update any of these forward-looking statements or information unless required by law.
I want to remind our investors that we are on a fiscal year that began July 1, 2021, all references to Q3 fiscal 2022 are to our fiscal quarter ended March 31, 2022, and Q3 fiscal 2021 are to our fiscal quarter ended March 31, 2021. References to fiscal 2022 are to the 12 months ending June 30, 2022. I also want to note that while ABC shares trade in Canadian dollars, the company reports its financials in U.S. dollars.
With that, I'd like to turn the call over to Todd Sheppelman.
Thank you, Nathan, and good morning, everyone. I'm excited to welcome you to our third quarter earnings call. This quarter marks 1 year since our very first earnings season as a public company and what a year it's been. We've had some very significant wins and accomplishments over the year, and I remain excited about our journey. After our initial public offering in February 2021, Apollo acquired a majority stake in June of the same year, which was followed by Oaktree taking on the remaining minority stake in October.
We subsequently closed on 2 key acquisitions and launched a private placement as well as a rights offering, while booking record levels of new business to support future growth and optimizing our cost structure, all against the backdrop of a very demanding macroeconomic environment. In response to these challenges, ABC has remained focused on controlling the controllable factors of our business and has remained resilient as demonstrated by our sequentially improving financial results promised at the beginning of the fiscal year and executing on our early steps of our new M&A road map.
On that note, let's go into the highlights for the quarter, beginning on Slide 4. David will provide his full rundown of our financials in his upcoming remarks. But at a high level, our revenue and adjusted EBITDA for the third quarter landed at 286 and $30 million, respectively. Both were up year-over-year as well as quarter-over-quarter benefiting from less volatile OEM production schedules, contributions from recent acquisitions with offsets from ongoing supply chain disruptions, which impacted both OEM customers and ABC directly.
Moving now to a broader production environment, which has been a hot topic for more than 1 year. This quarter was no different. We continue to navigate numerous challenges, including ongoing but lessening semiconductor shortages, COVID lockdowns and persistent material and labor cost inflation. In the context of this taxing environment, OEM customer plants are still running at reduced volumes, but ABC's focus on prioritized truck and SUV platforms aided out-performance relative to IHS production figures.
We have seen new difficulties unfold this quarter of both humanitarian and operational in nature, as with the crisis in Ukraine. Our thoughts are with those affected, and we have endeavored to assist in this humanitarian effort. Through Karl Etzel, employees of our Muhlacker, Germany plant and joint effort with the company have donated to the Ukrainian cause. We've also continued to support Ukrainian relief efforts by actively hiring individuals who have been evacuated from the region and are providing support to them and their families through our plant in Poland. As for the impact to our business, there's been a little bit of flow through to our results for the quarter, given our North American geographical emphasis, but we will continue to monitor customer volume developments closely.
Shifting gears to our operational performance. We also delivered several highlights this quarter that we're very proud of. First, ABC registered its highest new business wins by revenue in recent history as several high-volume truck and SUV platforms were awarded. Second, the acquisition of dlhBowles and Karl Etzel, which were announced at signing last quarter and closed in the first week of March. We are already seeing positive contribution from both in our financial results. With early signs of success through integration activities, synergies and cross-sell opportunities.
Finally, on April 30, we signed a definitive agreement to sell the real estate associated with Karl Etzel to a German real estate investor in a sale-leaseback transaction that will bring in approximately USD 50 million of proceeds, which will be used to pay down debt. Though there is still a high level of uncertainty as to when the macroeconomic crisis affecting the industry will normalize. We continue to expect these challenges to be transient in nature and are confident that the long-term growth trajectory and solid fundamentals of our business remain unchanged. Despite the near-term headwinds, we see many reasons to remain optimistic about the longer-term industry dynamics as well as the overall ABC story.
Moving to Slide 5. Q3 results were once again impacted by factors outside of our control, including semiconductor shortages, inflated input costs and other OEM production issues. Beginning with the cost pressures, ABC has seen ongoing and significant inflation with respect to raw materials, including resin, glass fiber, rubber, paint and steel as well as higher logistics and labor costs. Beyond the impacts of elevated resins quantified in these bridges, ABC has also contended with rising wage pressures across North America as well as fuel and container surcharges on truck, rail and air transport that were at 15-year highs in some areas. Combined with sub-optimal utilization in our plants, primarily as the result of OEM production scheduling issues, these items drove the adjusted margins that you see on the right of the page and below the level ABC is capable of operating at in a normal production environment.
Next is, we continue to live with the impact of the pandemic. Last quarter's reprieve from COVID outbreaks and lockdowns were again interrupted in March and April. While Shanghai and other new lockdowns across China did not have a material impact on results for the current quarter, we anticipate impacts in future quarters as logistics backups unwind and other supply chain disruptions continue, though at a lesser degree than we've seen in prior quarters. And finally, before we move off this slide, I'll end on the impact to our business from the Russian-Ukraine conflict. As I touched on earlier, ABC has been materially insulated from negative impacts due to our primarily North American geographic exposure. Importantly, however, we expect that select OEM customers may be affected in the coming quarters, though with limited impact on ABC and its European plants.
On Slide 6, you'll see our regular update of the larger production and inventory environment. [ In a ] revision to what we've seen IHS signal in prior quarters, the production forecast is once again declined in the near term. According to IHS, a normalized production environment reflecting approximately 4 million vehicles produced per quarter will not return until at least the beginning of the calendar year 2023. With that said, there's still a lot to look forward to on the demand side of the industry. North American OEM production, which was roughly 3.6 million vehicles in the third quarter, is expected to rebound steadily to 4.1 million vehicles over the next 12 months and average almost 4.2 million vehicles per quarter through the end of 2029.
On the right side of this slide, you'll see that the total U.S. inventory has remained steady at near low record levels. With 1 million vehicles on dealer lots, the current average inventory of 25 days is roughly 65% lower than dealers have historically kept on hand pre-COVID. As we look forward, ABC is well prepared and looking forward to capitalizing on a return to a more normalized production and inventory environment.
On Slide 7, I'll touch briefly on some of the important launches and program wins for the quarter, beginning with one of our most significant sales achievements to date. This past quarter was the largest for new business wins in many years, demonstrated continued strength in quoting activity from the customer, along with ABC's ability to capitalize on these opportunities. We received over $1.5 billion of lifetime new business wins during the quarter, which puts us well ahead of our plan for the year. The balanced mix between replacement and new wins for this quarter highlights both our ability to continue to meet existing customer requirements while offering innovative new products that are taking share in the marketplace.
In addition to major [ ICE wins ] we've had, we had another strong quarter of EV wins with $114 million of lifetime revenue from 7 awarded programs. Many of these wins were in ABC's pickup truck and SUV space, where we continue to win as the vehicle shift from internal combustion engines to battery electric vehicles. On the left-hand side, you'll see some of the important launches for the quarter. These include the mid-cycle updates of the Chevy Silverado and GMC Sierra for both light-duty and heavy-duty, an exterior systems launch for the Hyundai Santa Fe and Kia Sorento through Mobis and an interior systems launch on the Kia Sportage. For this quarter, our launches really highlight that the new business wins over the past years with the Asian OEMs that we mentioned during the IPO really coming to fruition. Last but not least, we're also in the middle of multiple launches on the new all-electric Cadillac Halo vehicle, [ The Larry ].
On Slide 8, I'd like to touch on some of the new innovations and technologies that we are introducing to customers as well as implementing internally to drive greater productivity and cost efficiencies. One of our more recent innovations is the screw less air box that you see here on the left. This air box provides the ability to service the air filter without the difficulties of removing screws for the risk of having parts fall into the engine and allows for installation and removal of the air box upper with just one hand. This patent-pending design provides cost reduction, weight savings, tool and production cycle time savings in addition to making servicing the vehicle much more efficient.
Another development I'd like to highlight today is the Ford Bronco rear bumper ADAS sensor integration. Adding to our long list of prior innovations, ABC is the first company in the industry to integrate park assist sensors into a blow-molded bumper, representing a new baseline for blow-molded bumper systems capabilities. The sensors can be assembled via snap fit features, eliminating any additional hardware required to retain the sensors in place. This technology allows for rugged SUVs and other light trucks and transit vehicles to include park assist functionality in lightweight plastic [ interior ] systems and designs.
Additionally, ABC has been recently nominated as a finalist for the prestigious Automotive News PACE pilot award and recognition of our recent industry-first process developments for variable cooling and our blow-molding technology. This innovation drives reductions in cycle time and energy consumption in the manufacturing process, allowing for additional production capacity and at a lower cost versus traditional blow-molding processing. These are among the many innovations and developments that continue to differentiate ABC as a preferred Tier 1 supplier of highly engineered technical plastics.
With that, I'll turn the call over to David.
Thanks, Todd. I'll start with an overview of our financial performance in our fiscal third quarter ended March 31. This slide shows sales, adjusted EBITDA, EBITDA margin and free cash flow, and I will spend some time to give color to the significant aspects of our major income statement line.
ABC's revenue for Q3 fiscal '22 was $285.8 million, up 31.1% from Q3 fiscal 2021. As expected, Q3 revenue was supported by the acquisition of both Karl Etzel and dlhBowles, which contributed 1 month of the quarter as well as rebounding North America auto production, partially offset by volume-related losses from semiconductor shortages affecting our OEM customers' production. Cost of goods sold as a percentage of sales was 86.6%, up from 85.8% a year ago.
SG&A expenses were $29.3 million in Q3 fiscal 2022 compared to $38.2 million in the prior year. Last year's higher SG&A expenses were primarily a result of onetime items, including $7.7 million in transaction costs to complete our IPO as well as $6.5 million of transactional recruitment and other bonuses related to the IPO. These positive variances to SG&A expenses in fiscal '21 were partially offset by higher wages of $2.8 million, higher depreciation expense of $1.6 million, acquisition-related costs of $1.3 million and directors and officers insurance of $0.8 million.
In Q3 of the current fiscal year, operating income was $9.6 million compared to an operating loss of $6.3 million in Q3 fiscal 2021. As noted, the large year-over-year swing is largely attributable to $14.2 million of costs related to the IPO included in Q3 fiscal 2021. The current quarter net loss of $6.3 million compares to a net loss of $20.7 million in Q3 fiscal 2021. Primary contributors to this year-over-year variance are a $7.4 million increase in gross profit in Q3 fiscal 2022 due to higher sales, $8.9 million due to lower selling and general and administrative costs and a reduction in interest expense of $12.1 million, offset by a $13.6 million swing to income tax expense from recovery.
In Q3 fiscal 2022, there was a net loss per share of $0.07 on a fully diluted basis against a net loss per share of $0.39 in Q3 fiscal 2021. Adjusted EBITDA for Q3 fiscal 2022 increased 18.9% to $30 million from $25 million in the prior year. This quarter's adjusted EBITDA margin was 9.5% compared to 10.3% a year ago. Adjusted free cash flow was $7.7 million versus $9.9 million in the prior year period, primarily due to higher net cash flows from operating activities of $7.2 million, offset by higher purchases of property, plant and equipment of $4.6 million and lower onetime advisory bonus and other costs of $4.2 million. As a result of cost pressures, the company's joint ventures did not issue dividends in Q3 fiscal '22.
Our business continues to be adversely impacted by reduced production volumes at our OEM customers due to the semiconductor chip shortage, which leads to unpredictable production scheduling and related production and efficiencies. We note this impact appears to be lessening in degree. With increasing severity, however, the company is experiencing higher input costs, not just from resin, which has been well publicized, but also glass, rubber, paint and steel as well as elevated labor in several markets and freight costs. Excluding the semiconductor shortage and other OEM production issues, management estimates revenue would have been $310 million. Management further estimates that adjusted EBITDA would have been $44 million in Q3 fiscal 2022, excluding the impact from the semiconductor shortage, other OEM production issues and inflated resin costs.
Finally, before I move on to the next slide, I'd like to know for modeling purposes that our adjusted EBITDA includes our 50% proportionate share of our JV's EBITDA. And likewise, the computation of adjusted EBITDA margin includes 50% of the JV's revenue in the denominator. Given that the JVs are included in the income statement on the equity method basis, you need to reflect our -- you need to refer to our MD&A to see the JV proportionate sales and adjusted EBITDA details. Our MD&A is filed on SEDAR and is also available on our investor website.
Briefly, Slide 11 shows the walk from cash from ops down to adjusted free cash flow. As you can see, cash from ops is down just slightly versus last quarter, but has seen a significant improvement since the beginning of the year against the backdrop of recovering customer volumes and normalization of working capital. We expect this recovery to continue in Q4 and into fiscal 2023. The working capital tailwind we experienced over the last 2 quarters is expected to normalize throughout fiscal 2023.
Moving on to Slide 12 now, where you will see details of our capital structure and liquidity. During the quarter, we increased the size of our credit facility to $550 million, extended its maturity by 2 years to February 2027 and improved pricing. We remain fully compliant with all covenants under the amended credit agreement. And as we've previously mentioned, we maintained a high draw on our revolver due to lower levels of industry production. This has resulted in a commensurate and expected temporary increase in leverage. Importantly, management expects our leverage multiple to decline in the near term as improved financial performance, the integration of our recent acquisitions and the proceeds of the sale of Karl Etzel real estate allows us to pay down debt and return leverage levels below 3x.
With that, I'll turn it back over to Todd for a few closing remarks. Todd?
Yes. Thanks, David. I'll wrap up by saying that steadily increasing OEM production, albeit, still at depressed levels has provided greater production predictability compared to prior quarters. However, ABC still remains impacted by both the weaker OEM production environment and elevated input costs. We continue to build upon the strength of the prior 2 quarters in terms of total new business awards, including the EV space with our third quarter being the highest and recent of ABC's history for new business wins, including a key replacement of a high-volume North American truck and SUV platform.
Additionally, the combination of a [ USD 14 million ] with flat lining dealer inventories at record lows suggests that demand continues to outpace supply. [ For shadow ] in the need for multiple years of elevated production in order to replace lost volumes and meet heightened consumer demand, a phenomenon that bodes well for ABC's growth prospects for years to come. As I've already mentioned, we were thrilled to close on 2 M&A transactions in our pipeline during the fiscal Q3 and market volatility continues to present numerous high-quality opportunities that ABC intends to capitalize on. There are still targets in the pipeline that meet our mandate of diversifying ABC's customer and geographic footprint while driving profitability, scale, cash flow and increased ability to serve our customers globally.
In closing, ABC has remained agile and resilient in response to the ongoing challenges in the broader market. We have booked record amounts of new business, continued to develop innovations and technologies desirable to our customers and have capitalized on market volatility through our acquisition activities. Though we expect ongoing supply chain issues for the next several quarters to remain, we see ample opportunities for growth and improved efficiencies in the future as supply chains allow for a rebound to more normal production levels. Management continues to believe that ongoing market volatility precludes the ability to provide meaningful financial guidance. However, as the market normalizes and fundamentals continue to strengthen, we hope to be able to provide clarity to the market for our upcoming fiscal year when we report next quarter's results.
That concludes our prepared remarks. I'd like to thank you for listening and for your support. David and I, are now happy to take questions.
[Operator Instructions] The first question comes from Ryan Brinkman with JPMorgan.
On last quarter's call, I think you were limited in what you could say about [ the then ] pending acquisitions. I'm curious if now post closing, you might be able to help us a bit more [ granularly ] on what the margin profile is of the business is acquired? And what impact do you expect them to have on the financials of the combined business going forward.
So I think what we've said is that you'll continue to see the performance from the acquisitions come through in our quarterly performance as we continue to go forward and have a full quarter coming up here. We just had 1 month right now. I think we've been, as we mentioned before, hesitant to go into too much detail just from a competitive nature's standpoint on the specifics of each one as we also don't break out necessarily the individual performance of our plants. But we're very positive that these are very strong accretive acquisitions that we have and that you'll start seeing that fundamentally come through very strong in the future quarters as well as cash flow, EBITDA and revenue. We've had great success to date on the integration. We've -- actually, it's been, I think, a faster integration and we're seeing more synergies from a customer cross-sell opportunity than we expected this early. So I think I would just say that they have been positive, they remained positive, and you'll see that in the results coming through.
Okay. I wanted to check...
We [ did disclose ] sales and net income. Just some throughout the MD&A, there is both sales and net income, but that's about as granular I think as we feel comfortable being at this time.
Okay. Sure. And then I wanted to check in on your commodity pass-through arrangements. In the case of the contracts that automatically adjust, is there anything to keep in mind going forward about the timing of any of these resets. For example, could the timing of a disproportionate amount of contracts resetting at higher prices? Could that impact the cadence of your quarterly earnings going forward? Or do you expect them to sort of more or less reset ratably throughout the year? And then in the case of those contracts, which do not automatically adjust, but are instead more subject to, I guess, ad hoc negotiation, how would you rate the progress of those negotiations and the willingness of automaker customers to fully offset the material cost inflation that you might be seeing?
Todd, I can just jump in, maybe for the first part, just. Right. Yes, the first part, Ryan, with respect to the indexing arrangements we have and the pass-through arrangements, nothing really has changed relative to timing or the way the contracts work. I'd still say we're roughly 50% hedged in the traditional ABC business, and about 25% of that sort of is just direct pass-through with no timing. And then the other parts have a bit of a lag to them, either 3 months or 6 months based on the individual customer contracts.
And then, Todd, do you want to just talk about our customer negotiations?
Yes. Ryan, I'd just say on the second half of that with the conversations, we certainly have had conversations with customers. They're at various stages. Some have progressed to some satisfactory conclusion on the negotiation side. Some were still in the middle of and others were at the beginning of the conversations.
And as you can imagine, these are long, complex dialogues and conversations that we're having, and it's not something that we settle in a matter of hours or days. It's a long lengthy conversation, but we feel confident in the ability to make progress in this area, and you'll see that flowing through over time as well. It's really hard to forecast the specifics of when they're going to hit.
But just in general, the Tier 1s have been really the gathering point of a lot of these inflationary pressures in the marketplace. And it's -- we can't just eat those costs and the OEMs certainly have been -- had some ability to price adjust in the marketplace. And we can't just be at the pinch point for all of the costs there. So we're certainly having those conversations, and we're -- we will continue to do so and drive to resolution and agreements.
Then just sort of last question, I guess a similar question, but instead of the material cost, maybe you can comment on some of the non-commodity supply chain costs you're seeing such as electricity, natural gas, diesel, even labor, et cetera. Are automakers understanding that these costs are going to have to be reimbursed to suppliers over time also because like you said they've got that sort of release valve with consumer pricing. And how are you intending to recover these higher costs over time? And over what time frame do you think you could recover them?
Yes. I think the answer to that, Ryan, is similar to the previous conversation. It's all part of the larger conversation. Those are all key inputs that we're seeing with significant rising costs were -- everybody is aware of the rise in the transportation costs and the field associated with that. But just also there are shortages across the marketplace on transportation, whether it's availability of drivers, availability of ships through COVID lockdowns or even the Russian-Ukraine conflict, has put a pinch on European ship transportation, which has really been shorted airspace. So aerospace is tight as well. So all of those costs are part of the conversation. They're all inflationary pressures and significant cost increases that we've seen. And we're bundling those up as part of the larger conversation we're seeing on rising input material cost.
The next question comes from Nauman Satti with Laurentian Bank.
So my first question is on the volumes for April and sort of half of May. I'm just wondering any help understanding if those volumes have improved sequentially. And I remember in last quarter or the one before that you had mentioned that some of the OEMs would give cancellation a week in advance or just a few days in advance. Has those things sort of changed? Has the production scheduling being improved when we look at things on a sequential basis? And any color on how April and May are trending?
Nauman, I appreciate the question. I think I would say that we had certainly increased visibility, and I think the OEMs have increased visibility as well into where their ability to produce vehicles are at. It's continued to get better, as you mentioned, sequentially on a month-over-month, quarter-over-quarter basis. We're certainly not seeing as much impact from just the pure chip problems that we had over the prior 12 months or more. But there are certainly other supply chain issues out there. The COVID lockdowns in Shanghai are one of them. Transportation is another one that has had impact. So we're probably seeing more on the transportation side of the equation than we have in the past and then lessening from a chip standpoint.
But you've -- I'm sure you've read in the press that there's still several OEMs that are having cancellations, but it's certainly been at a lessening pace that we've seen in the past, and we continue to believe that, that will continue to improve going forward. And so we remain optimistic that the sequential growth at a -- I think, slow steady pace is really what we anticipate is going to continue to happen, but there will be continued disruptions when -- eventually when Shanghai opens back up, there's going to be a mass rush to get parts out of there, which is going to really limit the open capacity on moving parts. And so that's going to be a difficult situation as production unwinds or shipping unwinds in the Shanghai area. But we're preparing for that. We're working with our supply base. We're working with the OEMs in constant contact with that. But I think we can all anticipate there will be spotty disruptions in the fourth quarter as those things unwind.
And just in your presentation on Slide 7, where you mentioned the largest quarter business win, which is about $1.5 billion. I'm wondering how much of business do you expect to fall off from traditional sort of ICE business that you do as EV business sort of comes up?
Yes. I think I would say, Nauman, that there's a transition going underway. It's not necessarily a step function and new business wins are always lumpy, and they can vary from quarter-to-quarter and whether it's ICE or whether it's BEV. I think we've seen in the past that we've had -- there was a rush of BEV programs then maybe just a little bit of a downturn in that just slightly as timing happens over the OEMs. And this past quarter, we had both a mix of BEV as well as a lot of ICE come through. And that's predominantly because of the -- just the nature of the awards. These are high-volume programs that we were awarded on large truck and SUV platforms that have some of the highest volumes in the marketplace. Our content is high on several of these vehicles.
And so when you do get an award in that space, even if it's an internal combustion engine, it can be a significant high volume. So I think I would say that going forward, we're going to continue to see and expect higher BEV sales going forward, but it will be spotty and lumpy, and it's not just a straight-line trajectory based on the timing of the OEM's electric vehicle programs and how they sequence those into their launch activities. They can't just launch 25 vehicles at one time, so every OEM has their own sequence and -- but we're going after those programs. We're in lots of discussions around the globe on those programs and some very exciting vehicles coming up, and we're right in the mix for a lot of those.
Okay. And in your MD&A, where you've sort of given this contribution from the 2 acquisitions, 1 month contribution for dlhBowles, it appears it's relatively less than what they had in, I would assume, January and February. Is that just a seasonality element, or if something else has changed there?
Yes. I think it's a little bit of seasonality there. Again, we only had 1 month -- or sorry, 1 week of -- or 1 month of the -- or [ partial month of ] yes, of the earnings. And I just think that there's maybe a little bit of input cost that they're experiencing as well, probably not as significantly as what we're exposed to, just given the product lines and what their raw material indexes are and input costs are. So I just think it's more transitory in nature, and we fully expect that going forward, they will be able to continue to maintain those margins.
And I would just highlight that the March results were in line with our underwriting model. So very much in line with what we expected.
Okay. That's good to hear. And maybe just one last one from my end. You guys did these 2 acquisitions, but how is the pipeline looking? Are you guys still active? Or you want to wait and sort of absorb these 2 before you sort of go out and do another one?
I would say that the pipeline is very strong and active right now. I would say that the 3 of us on this call plus several other of our leadership team are very busy working on numerous different opportunities. I think the difficulties in the market are opportunities for us given the relative strength that we have in the marketplace versus others and just the relative position that we have just allows us to be kind of a natural acquisition point for several of these companies that we're looking for. And so I would say that we're not just going to rest on our laurels of 2 acquisitions. Those are going very well, and we're going to continue our activity and the pipeline alignment is strong and there's almost daily additional opportunities that we're evaluating and looking at. So we're very bullish about the ability to continue to look and see and evaluate opportunities in the acquisition space. And I think that they're very good logical synergies and add-ons into ABC. So we're very excited about the M&A activity for sure.
The next question comes from Andrew Lopez with TD Securities.
Actually, Ryan already asked my question there. So I'll just say congratulations on the strong quarter, and I'll return to you, if I have anything.
[Operator Instructions] Our next question comes from Peter Sklar with BMO Capital Markets.
So just looking at your North American revenues, which were quite strong, whether you want to look at it year-over-year or quarter-over-quarter. In the write-up, you -- there were 2 factors, obviously, the 1 month of the acquisitions, but obviously, you've indicated the mix was strong. So obviously, GM truck production was strong, but can you call out other platforms that ABC is exposed to in North America where you had volumes above the industry?
Yes. I would say, Peter, that we're -- we certainly have different vehicles within there that have higher ABC content than others. So we're not just -- we have an average mix, but some of the ones that were at relatively higher volumes and came back from where they were lower in the prior quarters. So I would certainly say that with ship availability, you saw a lot more vehicles in the CUV space being produced in just trucks and high-end SUVs, which is really the story of some of the prior quarters. So the CUVs have certainly a lot of volume associated with them. They're the bread and butter right now from a volume standpoint. And the OEMs are eager to get more of those out into the marketplace, particularly given the dealer inventory situation.
So I think it was a volume thing, but it was also a content per vehicle that we have on those vehicles and typically CUVs. We've got some good content levels just given the -- that there's more typically spoilers on those, you see more interior content on those given the rare storage compartments into the back of the SUV. So just a better opportunity for more content. You've got dual wash systems. You've got multi-zone HVAC systems. And so we just see typically higher dollar content on those and the volume is certainly higher. So we just expect that to continue. I would say that there were several CUVs that had been down for long periods of time that went back to better volume production over this past quarter. And I think we'll see continued ups and downs as OEMs are continuing to focus their mix on available chips, but we're just happy to see that there were additional chips not just for pickup trucks and large SUVs, but it kind of came back into our sweet spot of some of the CUVs evolve.
So Todd, would you be...
Peter, I'd just add that, again, more than GM, but on some of the other OEMs as well. So across the ones in the [ D 3 ] and some of the Asians that we're supplying also good strong volumes.
Right. So Todd and David, you prepared to call out specifically some of the platforms that given your content and given the volume increases that contributed to this growth in revenue?
Yes. I wouldn't say it was necessarily just 1 or 2, Peter, I think it was pretty strong across the board that we saw. So I don't -- as we've looked at the numbers, there's nothing that necessarily just jumps out and says it was just this one particular vehicle. I think it's just the continued strength that we've seen in the overall marketplace and that on a lot of these vehicles, we have above the average content. So we're able to outpace and outgrow where the market is from an IHS CAGR growth rate standpoint, and we're continuing to win more businesses launch new businesses. And so it's just a combination of the new business that we've launched. We went through several of those examples that is additional content with -- for us. So it's just -- its net sales increase regardless of what the volume of the marketplace is on a number of vehicles produced spaces. So we just continue to expand our overall breadth in the marketplace across the OEMs being on more platforms. And then our CPV, we continue to drive up. So I would just say it was a combination of all those factors, really.
Okay. And then the other question I have, I'm looking at Page 7 of the deck where you disclose your wins. And the way you express your wins is life of program revenue. And it's kind of hard to take that number and translate it into -- like into a growth rate? And then also, I mean, there's business falling off. Some of this replacement business, some of it's new wins. So I wanted to know, like for your North American business over the next 5 years, do you have a view on what your growth rate will be above what the industry is doing? So [ Detroit 3 ] is growing 5%, like how much can ABC grow above that? Is it 2%, 3%, 5%? Like you have the order book and all the details in the cadence. So I'm just wondering if you have a view on that.
Yes, sure. So I'd say that at a high level, we have had and continue to have the ability to outgrow the marketplace on a CAGR basis. I think that still holds true. We're in the middle of our budget cycle right now. So we're putting all those details together. But I think as we said during the road show and consistently on these calls that we do have the ability to outgrow the market, and we'll continue to do so and are confident in the ability to do that.
Just could be -- just one other piece of information just from a typical lifespan of these vehicles, we see somewhere in the neighborhood of 6 years on average for a lifetime revenue and again, that can be lumpy depending on the specific vehicles that are in there. But I would just say for -- as a macro number, typical program life that we see in the industry across all of our platforms is about 6 years. But then the slight caution of some go 7 years, some go 5 years. So depending on the volume on those programs. But on a macro basis, I think 6 years is a pretty good number to use.
This concludes the question-and-answer session. I would like to turn the conference back over to Todd Sheppelman for any closing remarks.
Well, first of all, I just appreciate the ongoing support of everybody that's on the line here. I would say overall, a very solid quarter. We were happy to see the volumes coming back and the ability to still flow through. But I believe that we have still got a lot more to do as world gets back to normal and we get some of the inefficiencies out of the system. The visibility, as I've mentioned with the OEMs is getting better, but it's still mixed with both COVID issues as well as non-chip supply related issues are still out there. And we're certainly not in a friction-free system right now. Never will get totally friction-free, but there's just a lot more overall in the system right now than we typically would see.
The integration of the 2 acquisitions that we've done is going extremely well. Those have been very, very positive for us. And I think have really helped us understand the ability to integrate fastly and to continue to move on going forward. And there's really more opportunities for us in the marketplace and that opportunity set is growing almost on a daily basis that we're looking at and evaluating. So we're still very excited about the acquisition, but we're not just resting on that. We're still very focused also on our organic growth, which I think you saw come through again. And then for the past several quarters, we've had extremely strong new business wins. And replacement wins are as important to maintain your base. But as we mentioned on the call, there was a good mix on new businesses added to the program as well. So we're very happy with the combination of organic along with the acquisition.
And [ then just say in closing ] that we remain extremely positive as a management team on the ABC story. We're executing on what we said we were going to do when we did the IPO and the road show and the early calls with each of you. And we are continuing on that path. And I think it's -- we are all in and excited about where we're at. So I appreciate you participating on the call, and we'll talk with several of you in the upcoming day.
This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.