Linamar Corporation (TSX: LNR)
-- Sales increase 31.4% over the fourth quarter of 2009 ("Q4 2009");
-- Adjusted net earnings of $20.2 million or $0.31 per share up almost
double over 2009;
-- Adjusted operating earnings up $15.3 million or 115% over Q4 2009;
-- Launch book accelerates to over $2.1 billion;
-- Global expansion and diversification strategies realized through
acquisition in France;
-- Access business up 69% over prior year on an adjusted basis, market
continues to show positive signs of recovery;
-- The revolving credit facility due to expire in late 2011 was early
renewed for a 4 year term and the facility increased to $600 million.
Three Months Ended
December 31
2010 2009
(in millions of dollars, except earnings per share
figures) $ $
----------------------------------------------------------------------------
Sales $ 593.7 $ 451.9
Operating Earnings (Loss)
Powertrain/Driveline 38.1 28.8
Industrial (11.0) (21.0)
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Operating Earnings (Loss) $ 27.1 $ 7.8
Unusual Items $ 1.4 $ 5.4
Operating Earnings (Loss) - Adjusted $ 28.5 $ 13.2
Net Earnings (Loss) attributable to shareholders of
the company 19.2 14.6
Unusual Items 1.0 (3.9)
Net Earnings (Loss) attributable to shareholders of
the company - Adjusted 20.2 10.7
Earnings (Loss) per Share 20.2 10.7
Earnings (Loss) per Share - Adjusted 0.31 0.17
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Unusual Items
Taxable Items before Tax
1) Capital asset impairments due to market
conditions - 2.8
2) Closure announcement of Invar - 6.4
3) Access equipment contract converted from
previous period sale to a rental contract - 2.5
4) Change in key accounting estimates 5.9 (6.3)
5) Exchange gains on $130 million USD Private
Placement Notes (4.5) -
-------------------------
1.4 5.4
Tax Impact (0.4) (1.6)
-------------------------
1.0 3.8
Non-Taxable Items
6) Rate changes on future income taxes in Canada - (3.7)
7) Utilization of previously unrecognized tax
losses - (4.0)
-------------------------
Total Unusual Items 1.0 (3.9)
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Operating Highlights
Sales for the fourth quarter of 2010 ("Q4 2010") were $593.7
million, up $141.8 million from $451.9 million from Q4 2009:
Sales for the Powertrain/Driveline segment increased by $121.3
million, or 27.7% in Q4 2010 to $558.9 million compared to $437.6
million in Q4 2009. The sales increase in the fourth quarter was
impacted by:
-- significant levels of maturing volumes and newly launched programs from
the company's substantial book of launch business; and
-- higher sales driven by moderately increased consumer demand in the US
and Asia.
Industrial segment sales increased 143.4%, or $20.5 million from
Q4 2009 to $34.8 million. The sales increase was due to:
-- significant increases in demand in the access equipment markets
The company's adjusted operating earnings for Q4 2010 were $28.5
million. This compares to $13.2 million adjusted operating profit
for Q4 2009, an increase of $15.3 million:
-- the increase was driven primarily by improved margins as production
volumes increased on mature and launching new programs in the
Powertrain/Driveline segment; and
-- improved margins on the increased volumes in the access equipment.
-- Q4 2010 adjusted operating earnings of $38.0 million for the
Powertrain/Driveline segment were higher by $12.6 million from the
adjusted operating earnings of $25.4 million in Q4 2009;
-- the adjusted operating losses for the Industrial segment were $9.5
million in Q4 2010, a decrease in loss of $2.7 million from Q4 2009.
"We are very pleased with our 4th quarter results capping off a
year of rapid recovery from the lows of 2009," said Linamar CEO
Linda Hasenfratz, "Sales, earnings, content per vehicle, global
market presence and booked business launches are all growing,
poising Linamar for continued successful growth in the coming
years."
Dividends
The Board of Directors today declared an eligible dividend in
respect to the quarter ended December 31, 2010 of CDN$0.08 per
share on the common shares of the company, payable on or after
April 15, 2011 to shareholders of record on April 1, 2011.
Risk and Uncertainties (forward looking statements)
Linamar no longer provides a financial outlook.
Certain information provided by Linamar in these unaudited
interim financial statements, MD&A and other documents
published throughout the year that are not recitation of historical
facts may constitute forward-looking statements. The words
"estimate", "believe", "expect" and similar expressions are
intended to identify forward-looking statements. Persons reading
this report are cautioned that such statements are only predictions
and the actual events or results may differ materially. In
evaluating such forward-looking statements, readers should
specifically consider the various factors that could cause actual
events or results to differ materially from those indicated by such
forward-looking statements.
Such forward-looking information may involve important risks and
uncertainties that could materially alter results in the future
from those expressed or implied in any forward-looking statements
made by, or on behalf of, Linamar. Some risks and uncertainties may
cause results to differ from current expectations. The factors
which are expected to have the greatest impact on Linamar include
but are not limited to (in the various economies in which Linamar
operates): the extent of OEM outsourcing, industry cyclicality,
trade and labour disruptions, pricing concessions and cost
absorptions, delays in program launches, the company's dependence
on certain engine and transmission programs and major OEM
customers, currency exposure, and technological developments by
Linamar's competitors.
A large proportion of the company's cash flows are denominated
in foreign currencies. The movement of foreign currency exchange
rates against the Canadian dollar has the potential to have a
negative impact on financial results. The company has employed a
hedging strategy as appropriate to attempt to mitigate the impact
but cannot be completely assured that the entire exchange effect
has been offset.
Other factors and risks and uncertainties that could cause
results to differ from current expectations are discussed in the
MD&A and include, but are not limited to: fluctuations in
interest rates, environmental emission and safety regulations,
governmental, environmental and regulatory policies, and changes in
the competitive environment in which Linamar operates. Linamar
assumes no obligation to update the forward-looking statements, or
to update the reasons why actual results could differ from those
reflected in the forward-looking statements.
Conference Call Information
Q4 Conference Call Information
Linamar will hold a conference call on March 9, 2011 at 5:00
p.m. EST to discuss its fourth quarter/year end results. The
numbers for this call are (647) 427-3420 (local/overseas) or (888)
300-0053 (North America) confirmation number 42706437, with a
call-in required 10 minutes prior to the start of the conference
call. The conference call will be chaired by Linda Hasenfratz,
Linamar's Chief Executive Officer. A copy of the company's full
quarterly financial statements, including the Management's
Discussion & Analysis will be available on the company's
website after 4 p.m. EST on March 9, 2011 and at www.sedar.com by
the start of business on March 10, 2011. A taped replay of the
conference call will also be made available starting at 11:00 p.m.
on March 9, 2011 for seven days. The number for replay is (800)
642-1687, Conference ID 42706437. The conference call can also be
accessed by web cast at www.linamar.com, by accessing the investor
relations/events menu, and will be available for a 7 day
period.
Q1 Conference Call Information
Linamar will hold a conference call on May 11, 2011 at 5:00 p.m.
EST to discuss its first quarter results. The numbers for this call
are (647) 427-3420 (local/overseas) or (888) 300-0053 (North
America) confirmation number 42722371, with a call-in required 10
minutes prior to the start of the conference call. The conference
call will be chaired by Linda Hasenfratz, Linamar's Chief Executive
Officer. A copy of the company's full quarterly financial
statements, including the Management's Discussion & Analysis
will be available on the company's website after 4 p.m. EST on May
11, 2011 and at www.sedar.com by the start of business on May 12,
2011. A taped replay of the conference call will also be made
available starting at 11:00 p.m. on May 11, 2011 for seven days.
The number for replay is (800) 642-1687, Conference ID 42722371.
The conference call can also be accessed by web cast at
www.linamar.com, by accessing the investor relations/events menu,
and will be available for a 7 day period.
Linamar Corporation (TSX: LNR) is a diversified global
manufacturing company of highly engineered products powering
vehicles, motion, work and lives. The company is made up of 4 key
divisions - Manufacturing, Driveline, Industrial Commercial Energy
(ICE) and Skyjack, all world leaders in the design, development and
production of highly engineered products. The company's
Manufacturing and Driveline divisions focus on precision metallic
components, modules and systems for engine, transmission and
driveline systems designed for passenger vehicle markets. The ICE
group concentrates on similar products for on and off highway
vehicle, energy and other industrial markets. The company's Skyjack
division is noted for their innovative, high quality mobile
industrial equipment, notably its class-leading aerial work
platforms and telehandlers. With more than 12,500 employees in 39
manufacturing locations, 5 R&D centers and 13 sales offices in
11 countries in North America, Europe and Asia, Linamar generated
sales of more than $2.2 Billion in 2010. For more information about
Linamar Corporation and its industry leading products and services,
visit www.linamar.com.
Frank Hasenfratz Linda Hasenfratz
Chairman of the Board Chief Executive Officer
Guelph, Ontario
March 9, 2011
Contacts: Linamar Corporation Linda Hasenfratz (519)
836-7550
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