GUELPH, ON, May 7, 2014 /CNW/ - (TSX: LNR)
- Sales increase 23.2% over the first quarter of 2013 ("Q1 2013")
to reach record levels of $1,042.7
billion;
- Operating earnings up 56.3% over Q1 2013 to reach record levels
of $112.1 million;
- Net earnings up 64.6% over Q1 2013 and earnings per share up
64.0% over Q1 2013 reaching $79.7
million and $1.23
respectively, a new record for both;
- Net margins reach 7.6%, well above target levels of 4 to
6%;
- Launch book at more than $3.0
billion;
- Industrial segment showed significant margin improvements from
Q1 2013 with operating earnings up 111.9% to $30.3 million on a sales increase of 31.2%;
- Powertrain/Driveline showed strong margin improvements as well
with operating earnings up 42.5% to $81.8
million from Q1 2013 on a sales increase of 21.6%;
- Return on Capital Employed reached 19.5% continuing our trend
of solid improvements for the last 11 quarters;
- Return on Equity improved 26% from Q1 2013 to reach 22.6%;
and
- Total debt to capital continues to improve reaching 28.4%, one
of the strongest balance sheets in our peer group.
|
|
|
Three Months
Ended |
|
|
|
March 31 |
|
|
|
2014 |
|
|
2013 |
(in millions of dollars, except earnings per share
figures) |
|
|
$ |
|
|
$ |
Sales |
|
|
1,042.7 |
|
|
846.6 |
Operating Earnings (Loss) |
|
|
|
|
|
|
Powertrain/Driveline |
|
|
81.8 |
|
|
57.4 |
Industrial |
|
|
30.3 |
|
|
14.3 |
Operating Earnings (Loss) |
|
|
112.1 |
|
|
71.7 |
Net Earnings (Loss) |
|
|
79.7 |
|
|
48.4 |
Net Earnings (Loss) per Share |
|
|
1.23 |
|
|
0.75 |
Operating Highlights
Sales for the first quarter of 2014 ("Q1 2014") were $1,042.7 million, up $196.1 million from $846.6
million in Q1 2013.
Sales for the Powertrain/Driveline segment
("Powertrain/Driveline") increased by $153.2
million, or 21.6% in Q1 2014 compared with Q1 2013.
The sales increase in Q1 2014 was impacted by:
- increased European sales due to substantial levels of programs
launching, market growth resumption and our new German camshaft
business acquired in Q4 2013;
- the significant levels of newly launched programs in
North America;
- the ramp up of launching programs in Asia; and
- increased volumes from our on and off highway vehicle customers
in both North America and
Asia.
The Industrial segment ("Industrial") product
sales increased 31.2% or $42.9
million to $180.4 million in
Q1 2014 from Q1 2013. The sales increase was due to:
- increases in demand in the access equipment markets in both
North America and Europe;
- increased market share particularly in boom and telehandler
products at Skyjack; and
- the favourable impact of the strengthening U.S. dollar.
The Company's operating earnings for Q1 2014
were $112.1 million. This
compares to $71.7 million in Q1 2013,
an increase of $40.4 million.
Q1 2014 operating earnings for
Powertrain/Driveline were higher by $24.4
million or 42.5% over Q1 2013. The
Powertrain/Driveline segment experienced the following in Q1
2014:
- improved margins as production volumes increased on launching
and mature programs;
- higher margins as a result of a favourable sales mix to highly
capital intensive programs, which inherently have higher margins to
meet return expectations; and
- better margins as a result of productivity and efficiency
improvements.
Industrial segment operating earnings in Q1 2014
increased $16.0 million or 111.9%
over Q1 2013. The increase in Industrial operating earnings was
predominantly driven by:
- market share growth and increased demand in the access
equipment market;
- productivity and efficiency improvements driven by higher
volumes on new products and cost savings initiatives on mature
products; and
- the favourable impact of the strengthening U.S. dollar on
margins.
"What a terrific quarter for us at Linamar with
sales exceeding that $1 billion mark
and another exceptional level of margin improvement," said Linamar
CEO Linda Hasenfratz. "We
continue to deliver double digit growth top and bottom line,
excellent return on equity for our shareholders, and enjoyed
significant growth in content per vehicle in every region. We
continue to build our launch book now north of $3 billion in annual sales currently under
launch. The market is opportunistic for continued growth and
our team delivering on every count. We are so pleased with
the quarter, a great start to 2014."
Dividends
The Board of Directors today declared an eligible dividend in
respect to the quarter ended March 31,
2014 of CDN$0.10 per share on
the common shares of the company, payable on or after June 3, 2014 to shareholders of record on
May 23, 2014.
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
Q1 2014 Conference Call Information
Linamar will hold a conference call on
May 7, 2014 at 5:00 p.m. EST to discuss its first quarter
results. The numbers for this call are (647) 427-3383
(local/overseas) or (888) 424-9894 (North
America) confirmation number 3087972, 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 quarterly financial
statements, including the Management's Discussion & Analysis
will be available on the company's website after 4 p.m. EST on May 7,
2014 and at www.sedar.com by the start of business on
May 8, 2014. A taped replay of
the conference call will also be made available starting at
11:00 p.m. on May 7, 2014 for seven days. The number for
replay is (855) 859-2056, Conference ID 3087972. 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.
Audio only streaming of the conference call
available at http://www.media-server.com/m/p/edy3x8h7
Q2 2014 Conference Call Information
Linamar will hold a conference call on
August 7, 2014 at 5:00 p.m. EST to discuss its second quarter
results. The numbers for this call are (647) 427-3383
(local/overseas) or (888) 424-9894 (North
America) confirmation number 3091591, 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 quarterly financial
statements, including the Management's Discussion & Analysis
will be available on the company's website after 4 p.m. EST on August 7,
2014 and at www.sedar.com by the start of business on
August 8, 2014. A taped replay
of the conference call will also be made available starting at
11:00 p.m. on August 7, 2014 for seven days. The number
for replay is (855) 859-2056, Conference ID 3091591. 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.
Audio only streaming of the conference call
available at http://www.media-server.com/m/p/bw8knbrh
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 2
operating segments - the Powertrain/Driveline segment and the
Industrial segments which are further divided into 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 its innovative, high quality mobile
industrial equipment, notably its class-leading aerial work
platforms and telehandlers. With more than 18,000 employees in 44
manufacturing locations, 5 R&D centers and 15 sales offices in
12 countries in North America,
Europe and Asia, Linamar generated sales of $3.6 billion in 2013. For more information about
Linamar Corporation and its industry leading products and services,
visit www.linamar.com.
(signed) |
|
|
|
|
|
(signed) |
|
|
|
|
|
|
|
Frank Hasenfratz |
|
|
|
|
|
Linda Hasenfratz |
Chairman of the Board |
|
|
|
|
|
Chief Executive Officer |
Guelph, Ontario
May 7, 2014
SOURCE Linamar Corporation