Donnelly Corporation has announced net income of $9.7 million, or $0.91 per share, on second quarter revenues of $247 million, all-time records for earnings and revenue. For the second quarter of 2001, the Company reported net income of $5.0 million, or $0.49 per share, on revenues of $227 million. Second quarter 2002 net income benefited from strong growth and improved operating margins in Electronics Operations and the ongoing benefit from overhead reduction actions taken in 2001. Sales increased $20 million, or 9%, in the second quarter on a year-over-year basis, due primarily to the strong growth of key products including electrochromic mirrors, OnStar telematics mirrors, and electronic sensor related products.
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For the first six months of 2002, net income was $12.1 million, or $1.15 per share, on revenues of $458 million. For the comparable 2001 period, Donnelly reported net income of $5.0 million, or $0.48 per share, on revenues of $447 million. Strong growth in Electronic Operations was partially offset by weak European automotive production levels and the slow ramp-up of product launches by North American customers.
“The second quarter’s outstanding performance validates our strategy of becoming a technology-driven, global product-based organization focused on building a full pipeline of higher value-added products,” said Chairman and CEO Dwane Baumgardner. “In each of the core areas of integrated interior and exterior mirror systems, electronic vision systems, electronic sensors and engineered window systems, we have begun to see returns on our investments in new product development. The strong performance of our Electronics Operations is based on new higher value-added features and helped by robust North American automotive production. Furthermore, we have been able to better leverage these opportunities by continuing our focus on aggressive cost- control, and I am confident that we will be able to deliver continuing improvements,” concluded Baumgardner.
As previously announced, on June 25, 2002 Donnelly entered into a merger agreement under which the Company will become a wholly-owned subsidiary of Magna International Inc. upon consummation of the transaction. The closing of the merger transaction is conditioned on regulatory, shareholder and other approvals and on other conditions in the merger agreement. Donnelly’s financial results for the second quarter were not impacted by that transaction.
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