Power steering specialist China Automotive Systems boosted third quarter net sales 18.4% year on year to US$36.9m as sales of steering components for passenger and light-duty increased 22% to $24.6m. Net income rose 7.2% to $2.8m.
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“Our third quarter results were negatively impacted by the normal seasonality and the Beijing Olympics. Many OEMs reduced production and held off orders for components this summer. However, we continued to manage to generate growth in a slow market, as we continue to win new customers and expand our market share in China,” said CEO Qizhou Wu.
Gross profit for the third quarter of 2008 was US$9.9m compared with US$11.4m in the same quarter in 2007, and US$14.5m for the second quarter of 2008. Gross margin was 26.7% in the third quarter compared with 31.1% in the second quarter of 2008.
Operating income for the third quarter of 2008 was US$3.7m as compared with US$6.6m reported in the same quarter of 2007 and compared with US$5.5m for the second quarter of 2008.
The lower operating income was partially due to lower gross profit resulting from higher raw material prices as well as higher labour and transportation costs related to rising sales. CAAS also invested more in R&D as more personnel joined to design new products.
