USA: One time tax charge takes Visteon to $1.36 billion Q3 loss
Visteon Corp. lost $US1.36 billion in the third quarter, primarily from a one-time charge for deferred tax assets, and warned of challenging conditions ahead, the Associated Press (AP) reported.
The loss amounted to $10.86 a share, and compared with a net loss of $168 million, or $1.34 a share, in the year-ago quarter.
Visteon reportedly said it incurred charges of $1.2 billion in the July-September period, including $872 million as it increased valuation allowances against its deferred tax assets.
AP noted that the former Ford division said last month it would take a non-cash charge of $825 million to $900 million in the third quarter to write down deferred tax assets, which it attributed to Ford's decision to cut planned vehicle production in the fourth quarter. Ford is Visteon's largest customer.
Excluding special charges but including some restructuring costs, Visteon said it lost $152 million, or $1.21 a share, in the most recent quarter, AP added, noting that the consensus estimate of Wall Street analysts compiled by Thomson First Call was for a loss of 90 cents a share.
According to the Associated Press, sales in the quarter were $4.15 billion, up 7% from $3.88 billion a year ago. The company reportedly said non-Ford sales for the quarter amounted to 33% of total revenue, 7% greater than the year-ago period.
Sales to Ford amounted to $2.7 billion, a $101 million decrease from the third quarter of 2003 and the lowest total for any quarter in Visteon's history, AP said.
President and CEO Mike Johnston reportedly said he expected revenue to increase in the fourth quarter, but "our current cost structure combined with escalating material surcharges will challenge our operating performance for the rest of the year."