TRW Swings To Second Quarter Loss; Beats Analyst Estimates
August 04 2009 - 7:51AM
Dow Jones News
TRW Automotive Holdings Corp. (TRW), one of the world's largest
maker of safety parts, swung to a second quarter loss as production
cutbacks by auto makers eroded its financial footing.
The company posted a loss of $11 million, or 11 cents a share,
compared with a profit of $127 million, or $1.24 a share a year
earlier. Sales decreased 38.6% to $2.7 billion
However, TRW joined a growing list of auto parts makers that are
beginning to see signs of stabilization after making drastic job
cuts over the past year. TRW's loss narrowed compared to the first
quarter when the company reported a loss of $131 million.
"The restructuring and cost containment actions implemented over
the previous three quarters had a significant impact," TRW Chief
Executive John Plant said in a statement on Tuesday. "Finalizing
the agreement with our lenders to protect our liquidity, in
addition to our cost containment actions, should allow us to manage
through the downturn.
Excluding special items, TRW reported a second-quarter profit of
8 cents a share, beating the average analyst estimate of a loss of
83 cents, according to a survey by Thomson Reuters.
Auto parts makers could find some additional relief through the
"Cash for Clunkers" program heading into the second half of the
year. The enthusiastic response is depleting new car inventory
which will likely cause auto makers to increase their production
plans.
"We remain optimistic the first half of 2009 was the trough in
global automotive production for the current downturn," Plant said.
"Vehicle production forecasts are indicating higher levels of
production for the remainder of 2009 and into 2010."
TRW expects full-year sales to range between $10.5 billion and
$10.9 billion, with third quarter sales expected to be
approximately $2.8 billion.
-By Jeff Bennett, Dow Jones Newswires;
jeff.bennett@dowjones.com; 248-204-5542