TRW has announced that its fourth quarter earnings doubled over a year earlier, although that result was boosted by one-offs.
The company reported GAAP fourth quarter net earnings of US$425m or US$3.27 per diluted share, which compares to net earnings of US$204m or US$1.56 per diluted share in the prior year period.
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However, TRW said that special items influenced the result. Excluding special items, TRW reported fourth quarter 2011 net earnings of US$238m or US$1.84 per diluted share, which compares to net earnings of US$225m or US$1.72 per diluted share in the prior year period.
TRW warned late last year that vehicle production schedules moderated slightly in the second half of 2011, although demand for its products continued to grow in emerging markets.
TRW’s full-year 2011 sales grew to a record US$16.2bn, an increase of US$1.9bn or 13% compared to 2010. For the year, GAAP net earnings were US$1,157m, or US$8.82 per diluted share, which compares to net earnings of US$834m, or US$6.49 per diluted share in the prior year.
Similar to the company’s quarterly results, the 2011 and 2010 full year results contain special items such as restructuring charges, a gain related to favourable resolution of a commercial matter, charges related to the termination of a service contract, debt retirement charges, a gain on business acquisition, and favourable net tax items. Excluding special items, TRW reported full year 2011 net earnings of US$971m, or US$7.42 per diluted share, which compares to net earnings of US$844m, or US$6.57 per diluted share in 2010 (net earnings 15% ahead of 2010).
“TRW’s solid fourth quarter performance sustained the positive momentum established earlier in the year and propelled the Company to its second consecutive year of record earnings,” said John C. Plant, Chairman and Chief Executive Officer. “Achieving record sales and net earnings in 2011 despite the fragile and uncertain business environment demonstrates the strong market position of the company.”
2012 Outlook
TRW’s planning assumptions for industry production volumes in 2012 are approximately 13.9m units in North America and 18.4m units in Europe, up 6% and down 8%, respectively, compared to 2011 levels. Within the forecast for North America, the company expects production for the Detroit Three manufacturers will be about equal to their 2011 production levels.
TRW said that it continues to expect expansion in vehicle production volumes in China and the rest of world regions. Based on these production levels and the company’s expectations for foreign currency exchange rates, full year 2012 sales are expected to range between US$16bn and $16.4bn, with first quarter sales expected to be approximately US$4.1bn.
“TRW is positioned to sustain its positive momentum as we enter 2012 given its strong market position and continued growth opportunities resulting from increased global demand for TRW’s innovative technologies,” said Mr Plant. “Continuing to execute the Company’s aggressive growth strategy is a key objective in 2012 that will further position the Company for long-term success.”
