AURORA, Ontario, November 6, 2013 /PRNewswire/ --
Magna International Inc. (TSX: MG; NYSE: MGA) today
reported financial results for the third quarter ended September
30, 2013.
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
2013 2012 2013 2012
Sales $ 8,338 $ 7,411 $ 25,661 $ 22,804
Adjusted EBIT(1) $ 444 $ 352 $ 1,458 $ 1,271
Income from operations
before income taxes $ 391 $ 500 $ 1,391 $ 1,409
Net income attributable to
Magna International Inc. $ 319 $ 390 $ 1,103 $ 1,082
Diluted earnings per share $ 1.39 $ 1.66 $ 4.74 $ 4.60
All results are reported in millions of U.S. dollars, except per
share figures, which are in U.S. dollars.
(1)Adjusted EBIT is the measure of segment profit or loss as
reported in the Company's attached unaudited interim consolidated
financial statements.
Adjusted EBIT represents income from operations before income
taxes; interest expense, net; and other expense (income), net.
THREE MONTHS ENDED SEPTEMBER 30,
2013
We posted sales of $8.34 billion
for the third quarter ended September 30,
2013, an increase of 13% from the third quarter of 2012. We
achieved this sales increase in a period when vehicle production
increased 4% in North America and
1% in Europe, both relative to the
third quarter of 2012. In the third quarter of 2013, our North
American, European and Rest of World production sales, as well as
complete vehicle assembly sales and tooling, engineering and other
sales increased, in each case relative to the comparable quarter in
2012.
Complete vehicle assembly sales increased 10% to $680 million for the third quarter of 2013
compared to $620 million for the third quarter of 2012, while
complete vehicle assembly volumes increased 16% to approximately
34,000 units.
During the third quarter of 2013, income from operations before
income taxes was $391 million, net
income attributable to Magna International Inc. was $319 million and diluted earnings per share were
$1.39, decreases of $109 million, $71
million and $0.27
respectively, each compared to the third quarter of 2012.
During the third quarter of 2013, we recorded restructuring
charges which negatively impacted income from operations before
income taxes by $48 million, net
income attributable to Magna International Inc. by $33 million and diluted earnings per share by
$0.14.
During the third quarter of 2012, we recorded a re-measurement
gain on the acquisition of the controlling 27% interest in Magna
E-Car Systems Partnership ("E-Car"). This positively impacted
income from operations before income taxes by $153 million, net income attributable to Magna
International Inc. by $125 million
and diluted earnings per share by $0.53.
During the third quarter ended September
30, 2013, we generated cash from operations of $574 million before changes in non-cash operating
assets and liabilities, and invested $110
million in non-cash operating assets and liabilities. Total
investment activities for the third quarter of 2013 were
$347 million, including
$280 million in fixed asset additions and a $67 million increase in investments and other
assets.
NINE MONTHS ENDED SEPTEMBER 30,
2013
We posted sales of $25.66 billion
for the nine months ended September 30,
2013, an increase of 13% from the nine months ended
September 30, 2012. This higher sales
level reflected increases in our North American, European and Rest
of World production sales, as well as complete vehicle assembly
sales and tooling, engineering and other sales, in each case
relative to the first nine months of 2012.
During the nine months ended September
30, 2013, vehicle production increased 4% to 12.09 million
units in North America and
decreased 2% to 14.38 million units in Europe, each compared to the first nine months
of 2012.
Complete vehicle assembly sales increased 22% to $2.27 billion for the nine months ended
September 30, 2013 compared to
$1.86 billion for the nine months
ended September 30, 2012, while
complete vehicle assembly volumes increased 19% to approximately
110,000 units.
During the nine months ended September
30, 2013, income from operations before income taxes was
$1.39 billion, net income
attributable to Magna International Inc. was $1.10 billion and diluted earnings per share were
$4.74, a decrease of $18 million, and increases of $21 million and $0.14, respectively, each compared to the first
nine months of 2012.
During the nine months ended September
30, 2013, we recorded restructuring charges which negatively
impacted income from operations before taxes by $54 million, net income attributable to Magna
International Inc. by $39 million and
diluted earnings per share by $0.17.
During the nine months ended September
30, 2012, we recorded a re-measurement gain on the
acquisition of the controlling 27% interest in E-Car. This
positively impacted income from operations before income taxes by
$153 million, net income attributable
to Magna International Inc. by $125
million and diluted EPS by $0.53.
During the nine months ended September
30, 2013, we generated cash from operations before changes
in non-cash operating assets and liabilities of $1.90 billion, and invested $578 million in non-cash operating assets and
liabilities. Total investment activities for the first nine months
of 2013 were $874 million, including
$706 million in fixed asset additions
and a $168 million increase in
investments and other assets.
Don Walker, Magna's Chief
Executive Officer commented: "I am pleased with our strong
results for the quarter, which were higher than the third quarter
of 2012, excluding unusual items. On a year to date basis,
all of our reporting segments have generated improved operating
results year over year. In our Europe segment, we have reported seven
consecutive quarters of year over year improvements in Adjusted
EBIT. We believe our strong share price performance reflects,
among other things, our continued increases in operating
results."
A more detailed discussion of our consolidated financial results
for the third quarter and nine months ended September 30, 2013 is contained in the
Management's Discussion and Analysis of Results of Operations and
Financial Position and the unaudited interim consolidated financial
statements and notes thereto, which are attached to this Press
Release.
DIVIDENDS
Yesterday, our Board of Directors declared a quarterly dividend
of $0.32 with respect to our
outstanding Common Shares for the quarter ended September 30, 2013. This dividend is payable on
December 13, 2013 to shareholders of
record on November 29, 2013.
OTHER MATTERS
Subject to approval by the Toronto Stock Exchange and the New
York Stock Exchange, our Board of Directors approved a normal
course issuer bid to purchase up to 12 million of our Common
Shares, representing approximately 5.4% of our public float of
Common Shares. This new normal course issuer bid is expected to
commence on or about November 13,
2013 and will terminate one year later.
Vince Galifi, Magna's Chief
Financial Officer stated: "The Board's decision to approve a
new share repurchase program reflects their confidence in our
business prospects, our desire to maintain financial flexibility,
and our objective to provide increased value to shareholders."
UPDATED 2013 OUTLOOK
Light Vehicle Production (Units)
North America 16.1 million
Europe(1) 18.8 million
Production Sales
North America $16.2 - $16.5 billion
Europe $9.7 - $9.9 billion
Rest of World $2.2 - $2.3 billion
Total Production Sales $28.1 - $28.7 billion
Complete Vehicle Assembly Sales $3.0 - $3.2 billion
Total Sales $33.9 - $34.8 billion
Operating Margin(2)(3) Approximately 5.9%
Tax Rate(2) Approximately 22.5%
Capital Spending Approximately $1.3 billion
(1) Effective the first quarter of 2013, we disclose total European
rather than Western European light vehicle production
(2) Excluding other expense (income), net
(3) Excluding $158 million amortization of intangibles related to
the acquisition of E-Car
In this 2013 outlook, in addition to 2013 light vehicle
production, we have assumed no material acquisitions or
divestitures. In addition, we have assumed that foreign exchange
rates for the most common currencies in which we conduct business
relative to our U.S. dollar reporting currency will approximate
current rates.
ABOUT MAGNA
We are a leading global automotive supplier with 312
manufacturing operations and 87 product development, engineering
and sales centres in 29 countries. We have over 125,000 employees
focused on delivering superior value to our customers through
innovative processes and World Class Manufacturing. Our product
capabilities include producing body, chassis, interior, exterior,
seating, powertrain, electronic, vision, closure and roof systems
and modules, as well as complete vehicle engineering and contract
manufacturing. Our common shares trade on the Toronto Stock
Exchange (MG) and the New York Stock Exchange (MGA). For further
information about Magna, visit our website at
http://www.magna.com.
We will hold a conference call for interested analysts and
shareholders to discuss our third quarter results on Wednesday, November 6, 2013 at 8:00 a.m. EST. The conference call will be
chaired by Don Walker, Chief
Executive Officer. The number to use for this call is
1-800-757-8473. The number for overseas callers is 1-416-981-9011.
Please call in at least 10 minutes prior to the call. We will also
webcast the conference call at http://www.magna.com.
The slide presentation accompanying the conference call will be
available on our website Wednesday morning prior to the
call.
For teleconferencing questions, please
contact Karin Kaminski at
905-726-7103.
FORWARD-LOOKING STATEMENTS
The previous discussion contains statements that constitute
"forward-looking information" or "forward-looking statements"
within the meaning of applicable securities legislation, including,
but not limited to, statements relating to: forecast light vehicle
production volumes in North
America and Europe; Magna's
expected production sales in its North
America, Europe and Rest of
World segments; total sales; complete vehicle assembly sales;
consolidated operating margin; average effective income tax rate;
capital spending; future repurchases of Common Shares under our
Normal Course Issuer Bid; and other matters. The forward-looking
information in this press release is presented for the purpose of
providing information about management's current expectations and
plans and such information may not be appropriate for other
purposes. Forward-looking statements may include financial and
other projections, as well as statements regarding our future
plans, objectives or economic performance, or the assumptions
underlying any of the foregoing, and other statements that are not
recitations of historical fact. We use words such as "may",
"would", "could", "should", "will", "likely", "expect",
"anticipate", "believe", "intend", "plan", "forecast", "outlook",
"project", "estimate" and similar expressions suggesting future
outcomes or events to identify forward-looking statements. Any such
forward-looking statements are based on information currently
available to us, and are based on assumptions and analyses made by
us in light of our experience and our perception of historical
trends, current conditions and expected future developments, as
well as other factors we believe are appropriate in the
circumstances. However, whether actual results and developments
will conform with our expectations and predictions is subject to a
number of risks, assumptions and uncertainties, many of which are
beyond our control, and the effects of which can be difficult to
predict, including, without limitation: the potential for a
deterioration of economic conditions or an extended period of
economic uncertainty; declines in consumer confidence and the
impact on production volume levels; continuing economic uncertainty
in various geographic regions, including Western Europe; inability to sustain or grow
our business with OEMs; restructuring actions by OEMs, including
plant closures; restructuring, downsizing and/or other significant
non-recurring costs; continued underperformance of one or more of
our operating divisions; our ability to successfully launch
material new or takeover business; liquidity risks; bankruptcy or
insolvency of a major customer or supplier; a prolonged disruption
in the supply of components to us from our suppliers; scheduled
shutdowns of our customers' production facilities (typically in the
third and fourth quarters of each calendar year); shutdown of our
or our customers' or sub-suppliers' production facilities due to a
labour disruption; our ability to successfully compete with other
automotive suppliers; a reduction in outsourcing by our customers
or the loss of a material production or assembly program; the
termination or non-renewal by our customers of any material
production purchase order; a shift away from technologies in which
we are investing; risks arising due to the failure of a major
financial institution; impairment charges related to goodwill,
long-lived assets and deferred tax assets; shifts in market share
away from our top customers; shifts in market shares among vehicles
or vehicle segments, or shifts away from vehicles on which we have
significant content; risks of conducting business in foreign
markets, including China,
Russia, India, South
America and other non-traditional markets for us; exposure
to, and ability to offset, volatile commodities prices;
fluctuations in relative currency values; our ability to
successfully identify, complete and integrate acquisitions or
achieve anticipated synergies; our ability to conduct appropriate
due diligence on acquisition targets; ongoing pricing pressures,
including our ability to offset price concessions demanded by our
customers; warranty and recall costs; risk of production
disruptions due to natural disasters; pension liabilities; legal
claims and/or regulatory actions against us; our ability to
understand and compete successfully in non-automotive businesses in
which we pursue opportunities; changes in our mix of earnings
between jurisdictions with lower tax rates and those with higher
tax rates, as well as our ability to fully benefit tax losses;
other potential tax exposures; inability to achieve future
investment returns that equal or exceed past returns; the
unpredictability of, and fluctuation in, the trading price of our
Common Shares; work stoppages and labour relations disputes;
changes in credit ratings assigned to us; changes in laws and
governmental regulations; costs associated with compliance with
environmental laws and regulations; and other factors set out in
our Annual Information Form filed with securities commissions in
Canada and our annual report on
Form 40-F filed with the United States Securities and Exchange
Commission, and subsequent filings. In evaluating forward-looking
statements, we caution readers not to place undue reliance on any
forward-looking statements and readers should specifically consider
the various factors which could cause actual events or results to
differ materially from those indicated by such forward-looking
statements. Unless otherwise required by applicable securities
laws, we do not intend, nor do we undertake any obligation, to
update or revise any forward-looking statements to reflect
subsequent information, events, results or circumstances or
otherwise.
For further information about Magna, please see our website
at http://www.magna.com. Copies of financial data and
other publicly filed documents are available through the internet
on the Canadian Securities Administrators' System for Electronic
Document Analysis and Retrieval (SEDAR) which can be accessed
at http://www.sedar.com and on the United States
Securities and Exchange Commission's Electronic Data Gathering,
Analysis and Retrieval System (EDGAR) which can be accessed
at http://www.sec.gov
For further information: please contact Louis Tonelli, Vice-President, Investor
Relations at +1-905-726-7035.
(MG. MGA)