USA: Delphi's better Q2 results reflect GM orders boost
Delphi has today reported a 29 percent year-over-year increase in earnings for the second quarter of 2002 as the company benefited from a 5.4 percent improvement in revenue. The company highlighted the role played by its non-GM operations in the improvement, but there can be little doubt that higher North American production by its biggest customer - GM - was the major factor.
Delphi reported net earnings of $220 million, or 39 cents per share, in the second quarter. That compared with $171 million, or 30 cents per share, a year ago.
"Non-GM revenue grew 13 percent versus the same period last year, which contributed to solid results for the quarter," said Delphi Chairman, CEO and President J.T. Battenberg III. "In 2001 and early 2002, we announced restructuring plans to re-size the company to benefit from an anticipated rebound. Our continued restructuring, portfolio transformation and customer diversification initiatives are on track to yield improved results."
"We experienced strong growth in our non-GM revenue during the quarter as several previously announced customer programs began ramping up to volume production levels," said Delphi Chief Financial Officer Alan S. Dawes. "Our leading edge Recognition occupant sensing system, new rear seat entertainment systems, diesel common rail injection and new aftermarket sales channels all made an impact in the quarter."
During Q2 2002 Delphi further reduced its global workforce by 1,250 as part of its previously announced restructuring.
"These and other restructuring actions helped Delphi to offset increased healthcare and pension costs and improve our gross margin by 0.3 percent," said Dawes.
Delphi says it has now completed approximately 75 percent of the 2002 restructuring plan, which called for the reduction of 6,100 global positions by the end of March 2003.