AURORA, Ontario, May 8, 2014 /PRNewswire/ --
Magna International Inc. (TSX: MG; NYSE: MGA) today
reported financial results for the first quarter ended March 31, 2014.
THREE MONTHS ENDED
March 31, 2014 March 31, 2013
Sales $ 8,961 $ 8,361
Adjusted
EBIT(1) $ 605 $ 467
Income from
operations
before income
taxes $ 581 $ 457
Net income
attributable
to Magna
International
Inc. $ 393 $ 369
Diluted
earnings per
share $ 1.76 $ 1.57
(1) All results are reported in millions of U.S. dollars, except per share
figures, which are in U.S. dollars.
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, net.
THREE MONTHS ENDED MARCH 31,
2014
We posted sales of $8.96 billion
for the first quarter ended March 31,
2014, an increase of 7% over the first quarter of 2013. We
achieved this sales increase in a period when vehicle production
increased 4% in North America and
8% in Europe, each relative to the
first quarter of 2013. In the first quarter of 2014, our North
American, European, and Asian production sales, as well as tooling,
engineering and other sales and complete vehicle assembly sales all
increased, while our Rest of World production sales declined, each
relative to the comparable quarter in 2013.
Complete vehicle assembly sales increased 2% to $813 million for the first quarter of 2014
compared to $798 million for the
first quarter of 2013, while complete vehicle assembly volumes
decreased 5% to approximately 36,000 units.
During the first quarter of 2014, income from operations before
income taxes was $581 million, net
income attributable to Magna International Inc. was $393 million and diluted earnings per share were
$1.76, increases of $124 million, $24
million and $0.19,
respectively, each compared to the first quarter of 2013.
Excluding other expense, after tax in the first quarters of 2014
and 2013 and the impact of the Austrian tax reform in the first
quarter of 2014, income from operations before income taxes, net
income attributable to Magna International Inc. and diluted
earnings per share increased $140
million, $70 million and
$0.40 respectively, each compared to
the first quarter of 2013.
During the first quarter ended March 31,
2014, we generated cash from operations of $671 million before changes in non-cash operating
assets and liabilities, and invested $197
million in non-cash operating assets and liabilities. Total
investment activities for the first quarter of 2014 were
$271 million, including $217 million in fixed asset additions and
$54 million in investments and other
assets.
A more detailed discussion of our consolidated financial results
for the first quarter ended March 31,
2014 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 $0.38 with respect to our
outstanding Common Shares for the quarter ended March 31, 2014. This dividend is payable on
June 13, 2014 to shareholders of
record on May 30, 2014.
OTHER MATTERS
Subject to approval by the Toronto Stock Exchange and the New
York Stock Exchange, our Board of Directors approved an amendment
to our normal course issuer bid to increase the maximum number of
Common Shares that may be purchased under the Bid from 12 million
to 20 million of our Common Shares. The new maximum represents
approximately 9.0% of our public float of Common Shares as of
November 6, 2013. No other terms of
the Bid have been amended.
UPDATED 2014 OUTLOOK
Light Vehicle Production (Units)
North America 16.8 million
Europe 19.5 million
Production Sales
North America $17.1 - $17.7 billion
Europe $9.8 - $10.2 billion
Asia $1.6 - $1.8 billion
Rest of World $0.7 - $0.8 billion
Total Production Sales $29.2 - $30.5 billion
Complete Vehicle Assembly Sales $2.9 - $3.2 billion
Total Sales $34.9 - $36.6 billion
Operating Margin(1) Mid to high 6% range
Tax Rate(1) Approximately 24.5%
Capital Spending Approximately $1.4 billion
(1) Excluding other expense, net
In this 2014 outlook, in addition to 2014 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 315
manufacturing operations and 82 product development, engineering
and sales centres in 29 countries. We have over 128,000 employees
focused on delivering superior value to our customers through
innovative products and 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
first quarter results on Thursday, May 8, 2014 at 2:00 p.m. EDT. The conference call
will be chaired by Don Walker, Chief Executive Officer. The number to use for this
call is 1-800-272-6255. The number for overseas callers is 1-416-981-9093. 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 Thursday afternoon prior to the call.
FORWARD-LOOKING STATEMENTS
The previous discussion contains statements that constitute
"forward-looking statements" or "forward-looking information"
within the meaning of applicable securities legislation, including,
but not limited to, statements relating to Magna's expected
production sales, based on expected light vehicle production in
North America and Europe; Magna's expected production sales in
the North America, Europe, Asia
and Rest of World segments; total sales; complete vehicle assembly
sales; consolidated operating margin; effective income tax rate;
fixed asset expenditures; and future purchases of our Common Shares
under the Normal Course Issuer Bid. The forward-looking information
in this document 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 impact of economic or political
conditions on consumer confidence, consumer demand for vehicles and
vehicle production; restructuring, downsizing or other significant
non-recurring costs, including in our European business; fines or
penalties imposed by antitrust and regulatory authorities,
including the German Cartel Office; our ability to grow our
business with Asian-based customers; continued underperformance of
one or more of our operating Divisions; ongoing pricing pressures,
including our ability to offset price concessions demanded by our
customers; our ability to successfully launch material new or
takeover business; 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, India, Russia, Brazil, Argentina, Eastern
Europe and other non-traditional markets for us; a prolonged
disruption in the supply of components to us from our suppliers;
shutdown of our or our customers' or sub-suppliers' production
facilities due to a work stoppage or labour dispute; scheduled
shutdowns of our customers' production facilities (typically in the
third and fourth quarters of each calendar year); 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; our
ability to consistently develop innovative products or processes;
impairment charges related to goodwill and long-lived assets;
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 sufficient
due diligence on acquisition targets; warranty and recall costs;
risk of production disruptions due to natural disasters; pension
liabilities; legal claims and/or regulatory actions against us;
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; changes in
credit ratings assigned to us; changes in laws and governmental
regulations; costs associated with compliance with environmental
laws and regulations; liquidity risks as a result of an
unanticipated deterioration of economic conditions; our ability to
achieve future investment returns that equal or exceed past
returns; the unpredictability of, and fluctuation in, the trading
price of our Common Shares; 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:
Louis Tonelli, Vice-President,
Investor Relations at +1-905-726-7035.
For teleconferencing questions, please contact Nancy Hansford at
+1-905-726-7108.