Federal-Mogul Corp., the auto-parts supplier controlled by billionaire Carl Icahn, dropped the most in almost three months after the slowdown in Europe’s vehicle market contributed to a third straight quarterly loss.
The shares fell 6.9 percent to $8.45 at the close in New York, the biggest decline since Dec. 3. They have gained 5.4 percent this year, as the Standard & Poor’s 500 Index rose 6.3 percent.
Federal-Mogul said today that it will shut more factories, mostly in western Europe, and shift the work by 2015 to lower-cost locations such as Mexico, China and Poland. Last year, the Southfield, Michigan-based company announced a $60 million restructuring that included closing three plants by this July. Vehicle sales in the Europe slumped to a 19-year low in 2012.
“This was really a very disappointing quarter,” Brian Sponheimer, a Gabelli & Co. analyst in Rye, New York, said in an interview. He has a buy rating on Federal-Mogul shares.
Sponheimer said Federal Mogul “needs to effectively address its cash in 2013 and there needs to be a clearer path toward profitability” in its division that sell to automakers.
Federal-Mogul said in a statement today that it used $480 million more cash in 2012 than it took in, and ended the year with $467 million.
The fourth-quarter net loss narrowed to $80 million, or 81 cents a share, from $239 million, or $2.42, a year earlier, the Southfield, Michigan-based company said. The loss excluding items such as legal, impairment and restructuring costs was $41 million, Federal-Mogul said. The single analyst estimate compiled by Bloomberg was for adjusted profit of $15 million.
Sales fell 3.6 percent to $1.6 billion, beating the $1.55 billion average of two estimates. Gross margin fell to 10.5 percent of sales, from 14.9 percent a year earlier.
Federal-Mogul didn’t break out its 2012 sales by country or region. In 2011, Germany, France, Italy, Switzerland and the U.K. combined for 39 percent of the company’s revenue, according to data compiled by Bloomberg.
Icahn controlled 78 percent of Federal-Mogul’s shares as of Dec. 31, according to data compiled by Bloomberg.