GUELPH, ON, Aug. 7, 2018 /CNW/ -
- Sales increase 22.1% over the second quarter of 2017 ("Q2
2017") to reach $2.2 billion, a new
record;
- Operating Earnings increased 26.3% over Q2 2017 to reach
$272.3 million, a new record;
- Net Earnings up 21.7% and earnings per share, on a diluted
basis, up 21.6% over Q2 2017 reaching $197.1
million and $2.98
respectively, both record levels as well;
- Continued business wins maintains strong launch book at nearly
$4.5 billion;
- Strong content per vehicle growth in North America and Europe;
- Industrial segment sales up 80.2% and operating earnings up
146.8% thanks to the acquisition of MacDon, market share gains and
strong volumes for access equipment at Skyjack;
- Industrial segment represents nearly 50% of overall earnings
thanks to solid growth; and
- Transportation segment sales up 7.2% thanks to launches despite
key customer production cuts.
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
|
June 30
|
|
|
|
June 30
|
(in millions of
dollars, except earnings per share figures)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
$
|
|
$
|
|
$
|
|
$
|
Sales
|
2,157.4
|
|
1,766.2
|
|
4,051.4
|
|
3,422.2
|
Operating Earnings
(Loss)
|
|
|
|
|
|
|
|
|
Transportation
|
138.8
|
|
161.5
|
|
279.1
|
|
307.9
|
|
Industrial
|
133.5
|
|
54.1
|
|
208.2
|
|
99.9
|
Operating Earnings
(Loss)1
|
272.3
|
|
215.6
|
|
487.3
|
|
407.8
|
Net Earnings
(Loss)
|
197.1
|
|
161.9
|
|
353.8
|
|
307.0
|
Net Earnings (Loss)
per Share – Diluted
|
2.98
|
|
2.45
|
|
5.35
|
|
4.65
|
Earnings before
interest, taxes and amortization ("EBITDA")1
|
368.2
|
|
297.0
|
|
674.3
|
|
576.7
|
Operating Earnings
(Loss) – Adjusted1
|
276.6
|
|
215.6
|
|
491.6
|
|
407.8
|
Net Earnings (Loss) –
Adjusted1
|
200.3
|
|
161.9
|
|
357.0
|
|
307.0
|
Net Earnings (Loss)
per Share – Diluted – Adjusted1
|
3.03
|
|
2.45
|
|
5.40
|
|
4.65
|
EBITDA –
Adjusted1
|
372.5
|
|
297.0
|
|
678.6
|
|
576.7
|
Operating Highlights
Sales for the second quarter of 2018 ("Q2 2018") were
$2,157.4 million, up $391.2 million from $1,766.2 million in Q2 2017.
Sales for the Transportation segment ("Transportation")
increased by $101.7 million, or 7.2%
in Q2 2018 compared with Q2 2017. The sales in Q2 2018 were
impacted by:
- additional sales from launching programs in North America and Europe;
- increased volumes from our light vehicle automotive customers
in Europe; and
- additional sales from our medium and heavy duty truck and
off-highway vehicle customers; offset by the following issues that
had an impact on mature program volumes:
-
- lower production volumes on programs in North America with key customers; and
- lower volumes on programs due to a customer's disruption of
production caused by a fire at one of their suppliers.
The Industrial segment ("Industrial") product sales increased
80.2%, or $289.5 million, to
$650.6 million in Q2 2018 from Q2
2017. The sales increase was due to:
- increased sales related to the acquisition of MacDon;
- strong market share gains and increased volumes for
telehandlers in North
America;
- strong market share gains and increased volumes for booms in
North America and Europe; and
- strong market share gains for scissors in Europe and increased volumes in North America; partially offset by
- an unfavourable impact on sales from the changes in foreign
exchange rates from Q2 2017.
The Company's operating earnings for Q2 2018 were $272.3 million. This compares to
$215.6 million in Q2 2017, an
increase of $56.7 million.
Q2 2018 operating earnings for Transportation were lower by
$22.7 million, or 14.1% over Q2
2017. The Transportation segment's earnings were impacted by
the following:
- increased volumes from our light vehicle automotive customers
in Europe;
- production volumes increasing on launching programs in
North America and Europe;
- volume increase from our medium and heavy duty truck and
off-highway vehicle customers;
- a favourable foreign exchange impact from the revaluation of
the operating balances on the balance sheet from Q1 2018; offset
by
- sales declines on mature higher margin programs, as detailed
above, insufficiently offset by lower margins on programs in the
early stages of launch;
- increased management, R&D and sales costs supporting
growth;
- one-time restructuring costs incurred in Q2 2018; and
- an unfavorable impact on operating earnings from the changes in
foreign exchange rates from Q2 2017.
Industrial segment operating earnings in Q2 2018 increased
$79.4 million, or 146.8% from Q2
2017. The Industrial operating earnings results were
predominantly driven by:
- increased earnings related to the acquisition of MacDon;
- net increase in access equipment volumes; and
- a favourable foreign exchange impact from the revaluation of
the operating balances on the balance sheet from Q1 2018; partially
offset by
- an unfavourable impact on operating earnings from the changes
in foreign exchange rates from Q2 2017; and
- increased management, R&D, and sales costs supporting
growth.
"We are thrilled to announce another quarter of record sales and
earnings, both growing at a strong double digit level." said
Linamar CEO Linda Hasenfratz.
"Our diversification strategy is paying off in spades with our
Industrial segment now rivalling Transportation in terms of
earnings thanks to robust performance at both MacDon and
Skyjack. Launches are doing a fantastic job of growing CPV
and sales, both key to long term growth and quoting activity
remains at a very high level. Our future has never looked
brighter despite political uncertainty."
Dividends
The Board of Directors today declared an eligible dividend in
respect to the quarter ended June 30,
2018 of CDN$0.12 per share on
the common shares of the company, payable on or after September 12, 2018 to shareholders of record on
August 24, 2018.
Forward Looking Information, Risk and Uncertainties
Certain information provided by Linamar in this press release,
MD&A, the consolidated financial statements and other documents
published throughout the year which are not recitation of
historical facts may constitute forward-looking statements. The
words "may", "would", "could", "will", "likely", "estimate",
"believe", "expect", "plan", "forecast" and similar expressions are
intended to identify forward-looking statements. Readers 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 of the factors and
risks and uncertainties that cause results to differ from current
expectations include, but are not limited to, changes in the
competitive environment in which Linamar operates, OEM outsourcing
and insourcing; sources and availability of raw materials; labour
markets and dependence on key personnel; dependence on certain
customers and product programs; technological change in the sectors
in which the Company operates and by Linamar's competitors; delays
in or operational issues with product launches; foreign currency
risk; long-term contracts that are not guaranteed; acquisition and
expansion risk; foreign business risk; cyclicality and seasonality;
capital and liquidity risk; legal proceedings and insurance
coverage; credit risk; emission standards; tax laws; securities
laws compliance and corporate governance standards; fluctuations in
interest rates; environmental emissions and safety regulations;
trade and labour disruptions; world political events; pricing
concessions to customers; and governmental, environmental and
regulatory policies.
The foregoing is not an exhaustive list of the factors that may
affect Linamar's forwarding looking statements. These and
other factors should be considered carefully and readers should not
place undue reliance on Linamar's forward-looking statements.
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
Q2 2018 Conference Call Information
Linamar will hold
a webcast call on August 7, 2018 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) conference ID 8482418, with a call-in required 10
minutes prior to the start of the conference call. The URL
for the webcast is https://www.icastpro.ca/lin180807. 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, 2018 and at www.sedar.com by the start of
business on August 8, 2018. A
taped replay of the conference call will also be made available
starting at 8:00 p.m. on August 7, 2018 for ten days. The number for
replay is (855) 859-2056, Conference ID 8482418.
Q3 2018 Conference Call Information
Linamar will hold
a webcast call on November 7, 2018 at
5:00 p.m. EST to discuss its third
quarter results. The numbers for this call are (647) 427-3383
(local/overseas) or (888) 424-9894 (North
America) conference ID 6058968, with a call-in required 10
minutes prior to the start of the conference call. The URL
for the webcast is https://www.icastpro.ca/lin181107. The
conference call will be chaired by Linda
Hasenfratz, Linamar's Chief Executive Officer. A copy
of the Company's quarterly/year-end financial statements, including
the Management's Discussion & Analysis will be available on the
Company's website after 4 p.m. EST on
November 7, 2018 and at www.sedar.com
by the start of business on November
8, 2018. A taped replay of the conference call will
also be made available starting at 8:00
p.m. on November 7, 2018 for
ten days. The number for replay is (855) 859-2056, Conference
ID 6058968.
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 Transportation segment and the Industrial
segment, which are further divided into 5 operating groups –
Machining & Assembly, Light Metal Casting, Forging, Skyjack and
Agriculture, all world leaders in the design, development and
production of highly engineered products. The Company's Machining
& Assembly, Light Metal Casting and Forging operating groups
focus on precision metallic components, modules and systems for
powertrain, driveline and body systems designed for global
electrified and traditionally powered vehicle and industrial
markets. The Company's Skyjack and MacDon companies are noted for
their innovative, high quality mobile industrial and harvesting
equipment, notably class-leading aerial work platforms,
telehandlers, draper headers and self-propelled windrowers. Linamar
has more than 28,700 employees in 60 manufacturing locations, 8
R&D centers and 25 sales offices in 17 countries in North and
South America, Europe and Asia which generated sales of $6.5 billion in 2017. For more information about
Linamar Corporation and its industry leading products and services,
visit www.linamar.com or follow us on Twitter at @LinamarCorp.
___________________________________________
1 For more information refer to the section entitled
"Non-GAAP and Additional GAAP Measures" in the Company's separately
released Management's Discussion and Analysis
("MD&A").
|
SOURCE Linamar Corporation