AURORA, Ontario, May 8, 2014 /PRNewswire/ --
Magna International Inc. (TSX: MG; NYSE: MGA) today reported financial results for the first quarter ended March 31, 2014.
THREE MONTHS ENDED March 31, 2014 March 31, 2013 Sales $ 8,961 $ 8,361 Adjusted EBIT(1) $ 605 $ 467 Income from operations before income taxes $ 581 $ 457 Net income attributable to Magna International Inc. $ 393 $ 369 Diluted earnings per share $ 1.76 $ 1.57
(1) All results are reported in millions of U.S. dollars, except per share figures, which are in U.S. dollars. 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, 2014
We posted sales of $8.96 billion for the first quarter ended March 31, 2014, an increase of 7% over the first quarter of 2013. We achieved this sales increase in a period when vehicle production increased 4% in North America and 8% in Europe, each relative to the first quarter of 2013. In the first quarter of 2014, our North American, European, and Asian production sales, as well as tooling, engineering and other sales and complete vehicle assembly sales all increased, while our Rest of World production sales declined, each relative to the comparable quarter in 2013.
Complete vehicle assembly sales increased 2% to $813 million for the first quarter of 2014 compared to $798 million for the first quarter of 2013, while complete vehicle assembly volumes decreased 5% to approximately 36,000 units.
During the first quarter of 2014, income from operations before income taxes was $581 million, net income attributable to Magna International Inc. was $393 million and diluted earnings per share were $1.76, increases of $124 million, $24 million and $0.19, respectively, each compared to the first quarter of 2013.
Excluding other expense, after tax in the first quarters of 2014 and 2013 and the impact of the Austrian tax reform in the first quarter of 2014, income from operations before income taxes, net income attributable to Magna International Inc. and diluted earnings per share increased $140 million, $70 million and $0.40 respectively, each compared to the first quarter of 2013.
During the first quarter ended March 31, 2014, we generated cash from operations of $671 million before changes in non-cash operating assets and liabilities, and invested $197 million in non-cash operating assets and liabilities. Total investment activities for the first quarter of 2014 were $271 million, including $217 million in fixed asset additions and $54 million in investments and other assets.
A more detailed discussion of our consolidated financial results for the first quarter ended March 31, 2014 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.
Yesterday, our Board of Directors declared a quarterly dividend of $0.38 with respect to our outstanding Common Shares for the quarter ended March 31, 2014. This dividend is payable on June 13, 2014 to shareholders of record on May 30, 2014.
Subject to approval by the Toronto Stock Exchange and the New York Stock Exchange, our Board of Directors approved an amendment to our normal course issuer bid to increase the maximum number of Common Shares that may be purchased under the Bid from 12 million to 20 million of our Common Shares. The new maximum represents approximately 9.0% of our public float of Common Shares as of November 6, 2013. No other terms of the Bid have been amended.
UPDATED 2014 OUTLOOK
Light Vehicle Production (Units) North America 16.8 million Europe 19.5 million Production Sales North America $17.1 - $17.7 billion Europe $9.8 - $10.2 billion Asia $1.6 - $1.8 billion Rest of World $0.7 - $0.8 billion Total Production Sales $29.2 - $30.5 billion Complete Vehicle Assembly Sales $2.9 - $3.2 billion Total Sales $34.9 - $36.6 billion Operating Margin(1) Mid to high 6% range Tax Rate(1) Approximately 24.5% Capital Spending Approximately $1.4 billion (1) Excluding other expense, net
In this 2014 outlook, in addition to 2014 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.
We are a leading global automotive supplier with 315 manufacturing operations and 82 product development, engineering and sales centres in 29 countries. We have over 128,000 employees focused on delivering superior value to our customers through innovative products and 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 Thursday, May 8, 2014 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 1-800-272-6255. The number for overseas callers is 1-416-981-9093. 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 Thursday afternoon prior to the call.
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, Asia and Rest of World segments; total sales; complete vehicle assembly sales; consolidated operating margin; effective income tax rate; fixed asset expenditures; 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 impact of economic or political conditions on consumer confidence, consumer demand for vehicles and vehicle production; restructuring, downsizing or other significant non-recurring costs, including in our European business; fines or penalties imposed by antitrust and regulatory authorities, including the German Cartel Office; our ability to grow our business with Asian-based customers; continued underperformance of one or more of our operating Divisions; ongoing pricing pressures, including our ability to offset price concessions demanded by our customers; our ability to successfully launch material new or takeover business; 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, Russia, Brazil, Argentina, Eastern Europe and other non-traditional markets for us; a prolonged disruption in the supply of components to us from our suppliers; shutdown of our or our customers' or sub-suppliers' production facilities due to a work stoppage or labour dispute; scheduled shutdowns of our customers' production facilities (typically in the third and fourth quarters of each calendar year); 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; our ability to consistently develop innovative products or processes; impairment charges related to goodwill and long-lived assets; 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 sufficient due diligence on acquisition targets; warranty and recall costs; risk of production disruptions due to natural disasters; pension liabilities; legal claims and/or regulatory actions against us; 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; changes in credit ratings assigned to us; changes in laws and governmental regulations; costs associated with compliance with environmental laws and regulations; liquidity risks as a result of an unanticipated deterioration of economic conditions; our ability to achieve future investment returns that equal or exceed past returns; the unpredictability of, and fluctuation in, the trading price of our Common Shares; 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:
Louis Tonelli, Vice-President, Investor Relations at +1-905-726-7035.
For teleconferencing questions, please contact Nancy Hansford at +1-905-726-7108.
SOURCE Magna International Inc.