Powertrain and safety technology specialist Federal-Mogul Corporation has reported a first quarter 2009 net loss of US$101m on sales down 27% to $1.24bn.
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The supplier booked a $38m restructuring charge in the quarter as it continued to reduce capacity and costs to match the current market.
Operational EBITDA was a postive $70m with the earnings impact of reduced sales in the quarter partially offset by a $50m reduction in the company’s cost base compared with Q1 2008.
The company said its sales were better than the global automotive production downturn of 39% versus Q1 2008, with the US and European markets suffering a 56% and 41% decline, respectively.
“Federal-Mogul’s financial results for the first quarter of 2009 reflect the global automotive market downturn and its related effects,” said president and chief executive officer Jose Maria Alapont.
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By GlobalDataFederal-Mogul recently announced the closure of its Summerton, South Carolina and Dumas, Arkansas facilities and reduced global staff count by around 2,500 during the quarter. Global employment of about 40,000 at the end of Q1 2009 was 20% lower than the same period of 2008. More restructuring actions are planned.
The company recorded gross margin of $158m, or 12.8% of sales in the first quarter of 2009.
Federal-Mogul reported negative cash flow for Q1 2009 of $(196)m, compared to negative cash flow of $(163)m in Q1 2008 when adjusted for a one-time cash receipt of $225m in Q1 2008 in connection with the company’s emergence from Chapter 11.
“Throughout the downturn, we have continued to support the development of leading technologies and innovation while we adapt our cost base to the current sales environment. We remain committed to our sustainable global profitable growth strategy throughout these challenging times,” Alapont said.
