Visteon Corporation first quarter 2011 net profit was $39m, or $0.75 per share, on product sales of $1.97bn, compared with net income of $233m on product sales of $1.85bn for the first quarter of 2010. But last year’s result included a $237m net gain related to the termination of company-paid medical, prescription drug and life insurance coverage benefits under US post-retirement employee benefit (OPEB) plans. Adjusted EBITDA for Q1 2011 was $159m, compared with $161m in first quarter 2010.
“Our first-quarter results reflect higher sales resulting from increased vehicle production volumes across all products, regions and major customers,” said chairman, CEO and president Donald Stebbins.
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Hyundai-Kia and Ford each accounted for about 28% of Visteon’s Q1 product sales of $1.97bn, with Renault-Nissan accounting for 8% and PSA Peugeot-Citroen 7%. On a regional basis, Asia accounted for 40% of total product sales – up from 35% a year earlier – while Europe represented 39%, North America 16% and South America 5%.
Product sales increased by $127m compared with first quarter 2010. The impact of divestitures and closures lowered sales on a year on year basis by $88m. Excluding those, sales increased $215m, or about 12%, principally reflecting higher production volumes across all major customers, Visteon said.
Product gross margin for first quarter 2011 was $149m, compared with $417m a year earlier. Adjusting for the $251m gain related to OPEB termination in first quarter 2010, gross margin decreased $17m year-over-year as benefits from higher production volumes and currency were offset by divestitures and closures, customer agreements and net cost performance.
During first quarter 2011, Visteon won a substantial amount of new business, with the majority to be manufactured in Asia. Annual sales from these new business wins are expected to be more than $300m.
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By GlobalDataIt has increased its sales and earnings guidance for full year 2011 and now expects full-year 2011 product sales in the range of $7.75bn to $7.85bn and adjusted EBITDA in the range of $640m to $680m.
Visteon operates two manufacturing facilities and three customer service centres in Japan. While the effects of the earthquakes and tsunami in Japan in March did not materially impact the first-quarter results, customer production schedules remain fluid and subject to change, it noted.
“Visteon anticipates production disruptions to continue through the second and into the third quarter of 2011 and is working closely with its customers and suppliers to minimise the impact of such disruptions. As events in Japan continue to evolve, the company’s full-year 2011 outlook remains subject to change,” it said in a statement.
