Magna International, the world’s seventh largest automotive parts maker, has reported a weaker than expected fourth-quarter profit, even though revenues rose 34% from the year-earlier period.
According to a Reuters report, Magna said it made a profit of $US140 million, or $1.38 a share, for the period ended December 31, up from income of $110 million, or $1.10 a share, in the previous-year quarter.
Magna reportedly posted earnings from operations of $150 million, or $1.48 a share, compared with earnings from operations of $110 million, or $1.10 a share in 2002.
Analysts had forecast, on average, profit of $1.64 a share, according to Reuters Research.
Reuters noted that, in December, Magna said it would take a charge of 28 cents per share with 18 cents linked to write-downs at subsidiary Decoma International’s European operations while the remaining 10 cents relates to the impact of the Ontario government’s rollback of corporate income tax cuts.
At the time, Magna also reiterated its November quarterly forecast of diluted earnings per share from operations in the range of $1.50 to $1.70, the report added.
According to Reuters, Magna’s revenues in the latest quarter rose to $4.6 billion from $3.4 billion, due partly to the strengthening of the Canadian dollar against the US dollar.
The company, which derives much of its business from the ‘Big Three US carmakers, reportedly said its content per vehicles rose 21% in North America and 64% in Europe.