Magna International has posted a small rise in net profit for the first half of 2005 ended June 30 of $US397 million or $3.73 a share vs $367m ($3.77) a year ago.
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Operating income dropped to $577m vs $652m in 2004 on sales of $11,576m (2004: $10,216m).
Second quarter net income was $225m vs $188m a year ago while operating income dropped to $323m from $331m. Sales rose to a record $5,858m, up 15% from $5,113.
Earnings per share were $2.06 for the second quarter ended June 30, 2005, compared to $1.93 for the second quarter ending June 30, 2004.
In a statement, Magna said higher Q2 sales reflected increases of 19% year on year in North American average dollar content per vehicle and 16% in European average dollar content per vehicle.
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By GlobalDataDuring Q2, North American vehicle production declined approximately 1% and European vehicle production declined approximately 3%.
European complete vehicle assembly sales (by Magna Steyr) decreased 8% or $90 million to $1.05 billion in Q2 2005 compared to $1.14 billion for Q2 2004.
Magna said results are expected to continue to be impacted by the negative conditions in the automotive industry, including weak automotive production, OEM price concessions, higher commodity costs and general economic uncertainty.
In addition, our 2005 results are expected to be negatively impacted by certain unusual items, including rationalisation and other charges associated with certain of our operations, including operations that supplied MG Rover, and restructuring charges arising from our recently completed privatisations,” it added.
It expects 2005 average dollar content per vehicle to be between $710 and $730 in North America and between $305 and $325 in Europe and anticipates 2005 European complete vehicle assembly sales between $4.0 billion and $4.2 billion.
Magna has assumed 2005 vehicle production volumes will be about 15.7 million units in North America and 16.1 million units in Europe.
“In 2005, excluding [the impact of unusual items], we anticipate lower diluted earnings per share than 2004,” it added.
