Magna International Inc.
) adjusted earnings per share of $1.53 in the third quarter of
2013 improved 35.4% from $1.13 in the year-ago quarter and
outpaced the Zacks Consensus Estimate of $1.33. Net income
increased 32.8% to $352 million from $265 million in the year-ago
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On a reported basis, the company reported profit of $319 million
or $1.39 per share compared with $390 million or $1.66 a share in
the third quarter of 2012.
Revenues went up 12.5% to $8.34 billion in the reported quarter,
beating the Zacks Consensus Estimate of $8.26 billion. The
increase was driven by improvement in North American, European
and Rest of World (ROW) production sales and higher tooling,
engineering and Complete Vehicle Assembly sales.
Vehicle production rose 4% to 3.8 million units in North America
and 1% to 4.4 million units in Europe. Adjusted operating income
increased 26.5% to $439 million in the quarter from $347 million
in the year-ago quarter.
External Production Sales
(comprising North America, Europe and ROW units) went up 13.5% to
$7 billion in the reported quarter.
Revenues from North America increased 11% to $4 billion, driven
by product launches, positive impact of acquisitions and
increased production, partly offset by adverse impact of currency
translations, price concessions and production stoppage for some
Revenues from Europe went up 18% to $2.4 billion in the period.
The year-over-year improvement was attributable to the launch of
new programs and impact of acquisitions and increase in sales
value in the U.S.
Revenues from ROW augmented 16% to $574 million driven by the
launch of new programs, primarily in China and Brazil, partly
offset by decrease in sales value in the U.S and price
Revenues from the
Complete Vehicle Assembly
segment went up 10% to $680 million in the quarter, with a 16%
rise in assembly volumes to 33,818 units.
Tooling, Engineering & Other
expanded 6% to $695 million in the quarter.
Magna International had $1.1 billion in cash and cash equivalents
as of Sep 30, 2013, compared with $1.4 billion as of Sep 30,
2012. The company had long-term debt of $295 million as of Sep
30, 2013, compared with $258 million as of Sep .30, 2012.
In the first nine months of 2013, the company's cash flow from
operations increased to $1.3 billion compared with $1.1 billion a
year ago. Capital expenditures declined 11.3% to $706 million in
the period compared with $796 million in the first nine months of
Dividend & Share Repurchase
On Nov 5, 2103 the board of directors declared a quarterly
dividend of 32 cents per share. The dividend is payable on Dec
13, 2013 to shareholders of record as of Nov 29, 2013.
The board of directors approved Magna's plans to purchase up to
12 million of common shares, which is about 5.4% of the public
float. This repurchase program is subject to approval from the
Toronto Stock Exchange and the New York Stock Exchange.
For full-year 2013, Magna expects revenues between $28.1 billion
and $28.7 billion in the External Production segment. Complete
Vehicle Assembly sales are projected in the range of $3 billion
to $3.2 billion.
For 2013, total revenue of the company is expected between $33.9
billion and $34.8 billion. Operating margin is expected to be
around 5.9% with a tax rate of 22.5%. Capital expenditures are
expected to be about $1.3 billion.
Magna International, based in Aurora, Canada, is a leading
manufacturer and supplier of automotive components. The company
designs, develops and manufactures automotive systems,
assemblies, modules and components, apart from engineering and
assembling complete vehicles, primarily for sale to original
equipment manufacturers (OEMs) of cars and light trucks. The
company currently carries a Zacks Rank #2 (Buy).
Other stocks worth considering in the same industry are
). All carry a Zacks Rank #1 (Strong Buy).