Visteon shares fell back by 10% on the NYSE yesterday after the company reported a fall in its Q4 profits. However, the company posted solid full year 2010 results and the CEO was upbeat about the company’s reorganisation and prospects.
Visteon posted fourth quarter operating earnings of USD86m or USD1.66 a share, compared with USD276m or USD2.12 a share, a year earlier when the company was in bankruptcy.
Fourth quarter sales fell to USD1.89bn from USD1.97bn billion as divestitures and plant closures partly offset higher vehicle production schedules.
Full-year 2010 sales were put at USD7.47bn, 12% ahead of 2009 yielding net income for full year 2010 of USD1.03bn (but that net income figure included substantial gains from bankruptcy reorganisation). Adjusted EBITDA for full year 2010 was USD614m, an increase of US$160m on 2009.
“Our full year financial results significantly improved from last year, reflecting our ongoing operational actions, benefits from our restructuring initiatives and an upswing in global vehicle production volumes,” said Donald J. Stebbins, chairman, chief executive officer and president. “We capitalised on sales growth in China and other emerging markets through our extensive manufacturing and engineering presence in these key regions.”
Product sales for full year 2010 were USD7.32bn up more than 14% from 2009, reflecting higher customer vehicle production volumes and favourable currency effects. The improved production environment was partially offset by the impact of divestitures and plant closures completed in 2009 and the first half of 2010, which reduced product sales by USD422m.
Visteon said that approximately 29% and 25% of 2010 product sales were to Hyundai-Kia and Ford, respectively. Renault-Nissan and PSA Peugeot-Citroën collectively accounted for about 14% of sales. On a regional basis, Asia Pacific and Europe accounted for 40% and 36% of total product sales, respectively, while North America accounted for 18% and South America 6%.
Visteon reported an expected backlog of approximately USD700m of consolidated net new business for the period 2011 through 2013. Hyundai-Kia accounted for 61% of that, with Ford Motor Co. and PSA Peugeot-Citroën accounting for 16% and 7%, respectively.
“We retained the support and confidence of our customers throughout our reorganisation efforts,”” Stebbins said. “We very much appreciate this support, which reflects positively on our relationships and our capability to provide competitive, differentiated and solution-driven products and applications to our customers around the world.”
Visteon expects full year 2011 product sales in the range of USD7.3bn to USD7.5bn and adjusted EBITDA in the range of USD620m to USD660m.