Magna Announces First Quarter Results
Magna Announces First Quarter Results PR Newswire AURORA, Ontario, May 10, 2013 AURORA, Ontario, May 10, 2013 /PRNewswire/ -- Magna International Inc. (TSX: MG; NYSE: MGA) today reported financial results for the first quarter ended March 31, 2013. THREE MONTHS ENDED March 31, 2013 March 31, 2012 Sales $ 8,361 $ 7,666 Adjusted EBIT(1) $ 467 $ 444 Income from operations before income taxes $ 457 $ 439 Net income attributable to Magna International Inc. $ 369 $ 343 Diluted earnings per share $ 1.57 $ 1.46 All results are reported in millions of U.S. dollars, except per share figures, which are in U.S. dollars. (1) Adjusted EBIT is the measure of segment profit or loss as reported in the Company's attached unaudited interim consolidated financial statements. Adjusted EBIT represents income from operations before income taxes; interest expense, net; and other expense, net. THREE MONTHS ENDED MARCH 31, 2013 We posted sales of $8.36 billion for the first quarter ended March 31, 2013, an increase of 9% over the first quarter of 2012. We achieved this sales increase in a period when vehicle production increased 1% in North America and decreased 9% in Europe, each relative to the first quarter of 2012. Our North American, European and Rest of World production sales, as well as tooling, engineering and other sales all increased in the first quarter of 2013 relative to the comparable quarter in 2012. Complete vehicle assembly sales increased 33% to $798 million for the first quarter of 2013 compared to $599 million for the first quarter of 2012, while complete vehicle assembly volumes increased 25% to approximately 37,000 units. During the first quarter of 2013, income from operations before income taxes was $457 million, net income attributable to Magna International Inc. was $369 million and diluted earnings per share were $1.57, increases of $18 million, $26 million and $0.11, respectively, each compared to the first quarter of 2012. During the first quarter ended March 31, 2013, we generated cash from operations of $607 million before changes in non-cash operating assets and liabilities, and invested $456 million in non-cash operating assets and liabilities. Total investment activities for the first quarter of 2013 were $242 million, including $194 million in fixed asset additions and $48 million in investments and other assets. A more detailed discussion of our consolidated financial results for the first quarter ended March 31, 2013 is contained in the Management's Discussion and Analysis of Results of Operations and Financial Position and the unaudited interim consolidated financial statements and notes thereto, which are attached to this Press Release. DIVIDENDS Yesterday, our Board of Directors declared a quarterly dividend of $0.32 with respect to our outstanding Common Shares for the quarter ended March 31, 2013. This dividend is payable on June 17, 2013 to shareholders of record on May 31, 2013. UPDATED 2013 OUTLOOK Light Vehicle Production (Units) North America 15.9 million Europe(1) 18.4 million Production Sales $15.7 - $16.1 billion North America $9.3 - $9.6 billion Europe Rest of World $2.2 - $2.5 billion Total Production Sales $27.2 - $28.2 billion Complete Vehicle Assembly $2.8 - $3.1 billion Sales Total Sales $32.6 - $34.0 billion Operating Margin(2)(3) Mid to high 5% range Tax Rate(2) Approximately 24% Capital Spending Approximately $1.4 billion (1) Beginning in the first quarter of 2013, we disclose total European light vehicle production rather than Western European light vehicle production (2) Excluding other expense, net (3) Excluding $158 million amortization of intangibles related to acquisition of E-Car In this 2013 outlook, in addition to 2013 light vehicle production, we have assumed no material acquisitions or divestitures. In addition, we have assumed that foreign exchange rates for the most common currencies in which we conduct business relative to our U.S. dollar reporting currency will approximate current rates. ABOUT MAGNA We are a leading global automotive supplier with 315 manufacturing operations and 87 product development, engineering and sales centres in 29 countries. Our 121,000 employees are focused on delivering superior value to our customers through innovative processes and World Class Manufacturing. Our product capabilities include producing body, chassis, interior, exterior, seating, powertrain, electronic, vision, closure and roof systems and modules, as well as complete vehicle engineering and contract manufacturing. Our common shares trade on the Toronto Stock Exchange (MG) and the New York Stock Exchange (MGA). For further information about Magna, visit our website at http://www.magna.com . We will hold a conference call for interested analysts and shareholders to discuss our first quarter results on Friday, May 10, 2013 at 2:00 p.m. EDT. The conference call will be chaired by Don Walker, Chief Executive Officer. The number to use for this call is 1-800-728-2056. The number for overseas callers is 1-416-641-6705. Please call in at least 10 minutes prior to the call. We will also webcast the conference call at http://www.magna.com . The slide presentation accompanying the conference call will be available on our website Friday afternoon prior to the call. FORWARD-LOOKING STATEMENTS The previous discussion contains statements that constitute "forward-looking statements" or "forward-looking information" within the meaning of applicable securities legislation, including, but not limited to, statements relating to Magna's expected production sales, based on expected light vehicle production in North America and Europe; Magna's expected production sales in the North America, Europe and Rest of World segments; total sales; complete vehicle assembly sales; consolidated operating margin; effective income tax rate; fixed asset expenditures; implementation of improvement plans in our underperforming operations, and/or restructuring actions; and future purchases of our Common Shares under the Normal Course Issuer Bid. The forward-looking information in this document is presented for the purpose of providing information about management's current expectations and plans and such information may not be appropriate for other purposes. Forward-looking statements may include financial and other projections, as well as statements regarding our future plans, objectives or economic performance, or the assumptions underlying any of the foregoing, and other statements that are not recitations of historical fact. We use words such as "may", "would", "could", "should", "will", "likely", "expect", "anticipate", "believe", "intend", "plan", "forecast", "outlook", "project", "estimate" and similar expressions suggesting future outcomes or events to identify forward-looking statements. Any such forward-looking statements are based on information currently available to us, and are based on assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate in the circumstances. However, whether actual results and developments will conform with our expectations and predictions is subject to a number of risks, assumptions and uncertainties, many of which are beyond our control, and the effects of which can be difficult to predict, including, without limitation: the potential for a deterioration of economic conditions or an extended period of economic uncertainty; declines in consumer confidence and the impact on production volume levels; risks arising from the recession in Europe, including the potential for a deterioration of sales of our three largest German-based OEM customers; inability to sustain or grow our business with OEMs; restructuring actions by OEMs, including plant closures; restructuring, downsizing and/or other significant non-recurring costs; continued underperformance of one or more of our operating divisions; our ability to successfully launch material new or takeover business; liquidity risks; bankruptcy or insolvency of a major customer or supplier; a prolonged disruption in the supply of components to us from our suppliers; scheduled shutdowns of our customers' production facilities (typically in the third and fourth quarters of each calendar year); shutdown of our or our customers' or sub-suppliers' production facilities due to a labour disruption; our ability to successfully compete with other automotive suppliers; a reduction in outsourcing by our customers or the loss of a material production or assembly program; the termination or non-renewal by our customers of any material production purchase order; a shift away from technologies in which we are investing; risks arising due to the failure of a major financial institution; impairment charges related to goodwill, long-lived assets and deferred tax assets; shifts in market share away from our top customers; shifts in market shares among vehicles or vehicle segments, or shifts away from vehicles on which we have significant content; risks of conducting business in foreign markets, including China, India, South America and other non-traditional markets for us; exposure to, and ability to offset, volatile commodities prices; fluctuations in relative currency values; our ability to successfully identify, complete and integrate acquisitions or achieve anticipated synergies; our ability to conduct appropriate due diligence on acquisition targets; ongoing pricing pressures, including our ability to offset price concessions demanded by our customers; warranty and recall costs; risks related to natural disasters and potential production disruptions; factors that could cause an increase in our pension funding obligations; legal claims and/or regulatory actions against us; our ability to understand and compete successfully in non-automotive businesses in which we pursue opportunities; changes in our mix of earnings between jurisdictions with lower tax rates and those with higher tax rates, as well as our ability to fully benefit tax losses; other potential tax exposures; inability to achieve future investment returns that equal or exceed past returns; the unpredictability of, and fluctuation in, the trading price of our Common Shares; work stoppages and labour relations disputes; changes in credit ratings assigned to us; changes in laws and governmental regulations; costs associated with compliance with environmental laws and regulations; and other factors set out in our Annual Information Form filed with securities commissions in Canada and our annual report on Form 40-F filed with the United States Securities and Exchange Commission, and subsequent filings. In evaluating forward-looking statements, we caution readers not to place undue reliance on any forward-looking statements and readers should specifically consider the various factors which could cause actual events or results to differ materially from those indicated by such forward-looking statements. Unless otherwise required by applicable securities laws, we do not intend, nor do we undertake any obligation, to update or revise any forward-looking statements to reflect subsequent information, events, results or circumstances or otherwise. For further information about Magna, please see our website at http://www.magna.com . Copies of financial data and other publicly filed documents are available through the internet on the Canadian Securities Administrators' System for Electronic Document Analysis and Retrieval (SEDAR) which can be accessed at http://www.sedar.com and on the United States Securities and Exchange Commission's Electronic Data Gathering, Analysis and Retrieval System (EDGAR) which can be accessed at http://www.sec.gov For further information, please contact Louis Tonelli, Vice-President, Investor Relations at +1-905-726-7035. For teleconferencing questions, please contact Karin Kaminski at +1-905-726-7103.