Visteon's Operating Results Improve Year Over Year Before
Special Items
DEARBORN, Mich., Jan. 23 Visteon Corporation
today announced a net loss of $34 million for the Fourth Quarter or
$0.27 per share. The results include special charges of $51 million after
taxes, associated primarily with the Voluntary Salaried Separation Program in
the U.S. and the previously announced European Plan for Growth.
Excluding these special charges, the company earned $17 million, or $0.13
per share, meeting consensus expectations for the quarter and improving
$31 million, or $0.24 per share, compared with the same quarter a year ago.
In the Fourth Quarter of 2001, Visteon incurred a loss of $14 million, or
$0.11 per share, with no special charges recorded in the period.
For the full year 2002, the company recorded a net loss of $352 million,
or $2.75 per share, compared with a net loss of $118 million, or $0.91 per
share, for the full year 2001. Results for full year 2002 include special
charges of $142 million after taxes related to previously announced
restructuring actions. In addition, the company recorded a non-cash write-off
for all of the value of goodwill reflected in its financial statements of
$265 million after taxes, associated with adoption of Statement of Financial
Accounting Standards No. 142 in the First Quarter. Results for the full year
2001 include special charges of $121 million after taxes or $0.93 per share.
Excluding special items, the company's full year earnings for 2002 were
$55 million or $0.43 per share. This reflects an improvement of $52 million,
or $0.41 per share, compared with full year 2001 earnings of $3 million, or
$0.02 per share, excluding special items.
"We had a solid year in 2002 as we continue to position ourselves for the
future," said Pete Pestillo, Chairman and Chief Executive Officer. "Our
restructuring actions, greater customer diversification, and a strong team
effort led to improved operating results during the year. An intense focus on
cash allowed us to improve our cash flow, reduce our debt levels, and expand
our cash balances while funding our restructuring actions and our continued
customer diversification. Additionally, through working with Ford and our
labor partners we have taken great strides in improving our long-term
competitive position in Europe."
Sales and Non-Ford Business Wins
Sales for the Fourth Quarter 2002 totaled $4.5 billion, up $50 million, or
1%, from the same period a year ago. Non-Ford sales were $984 million, up
$162 million, or 20%, from the Fourth Quarter 2001. Non-Ford sales
represented 22% of total sales for the quarter, reflecting the company's
continued diversification of its sales base.
Sales for the full year 2002 totaled $18.4 billion, up $552 million, or
3%, from the same period a year ago. Non-Ford sales were $3.6 billion for the
full year 2002, up $429 million, or 13%, from 2001 levels.
In 2002, Visteon won more than $1 billion in net non-Ford new business
from more than a dozen global automakers in every region of the world and
almost one half was outside of North America. In addition, Visteon won more
than $500 million in new business with Ford, which was offset by returned and
lost business.
Cash and Debt-to-Capital
For the full year 2002, Visteon generated $501 million in operating cash
flow as the company increased trade payables, decreased receivables, and
reduced inventory. The company ended the year with $1.3 billion in cash and
marketable securities, up nearly $100 million from a year ago. Additionally,
the company reduced its outstanding debt by nearly $300 million, lowering debt
to $1.6 billion. The company's debt-to-capital ratio also improved during
2002, to 36% at year-end.
Outlook
"Our objective is to continue to improve our profitability in 2003.
Although we recognize it will be a challenging year, we are working hard to do
better in 2003 than we did in 2002," said Pestillo.
Visteon Corporation is a leading full-service supplier that delivers
consumer-driven technology solutions to automotive manufacturers worldwide and
through multiple channels within the global automotive aftermarket. Visteon
has about 77,000 employees and a global delivery system of more than 180
technical, manufacturing, sales, and service facilities located in 25
countries.
VISTEON CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DATA
(in millions, except per share amounts, percentages and as noted)
2002
over/(under)
2002 2001
Fourth Full Fourth Full
Quarter Year Quarter Year
Sales
Ford and affiliates $3,559 $14,779 $(112) $123
Other customers 984 3,616 162 429
Total sales $4,543 $18,395 $50 $552
Depreciation and
amortization (1)
Depreciation $131 $551 $(7) $(11)
Amortization 21 80 (5) (24)
Total depreciation and
amortization $152 $631 $(12) $(35)
Selling, administrative
and other expenses (2)
Amount $240 $865 $33 $52
Percent of revenue 5.3% 4.7% 0.7 pts 0.1 pts
Income (loss) before income
taxes, minority interests
and change in accounting
As reported $(49) $(117) $(28) $52
Excluding special items (2) 32 106 53 83
Net income (loss)
As reported $(34) $(352) $(20) $(234)
Before cumulative effect
of change in accounting (34) (87) (20) 31
Excluding special items (2) 17 55 31 52
Earnings (loss) per share
(basic and diluted)
As reported $(0.27) $(2.75) $(0.16) $(1.84)
Before cumulative effect
of change in accounting (0.27) (0.68) (0.16) 0.23
Excluding special
items (2) 0.13 0.43 0.24 0.41
Effective tax rate 36% 36% (2)pts (1)pts
EBITDA, as adjusted (2)
Amount $189 $773 $37 $32
Percent of revenue 4.2% 4.2% 0.8 pts -- pts
After tax returns (2)
On sales 0.6% 0.5% 0.8 pts 0.4 pts
On assets 0.9 0.7 1.3 0.5
On equity 2.3 1.8 4.0 1.7
Capital expenditures
Amount $262 $723 $26 $(29)
Percent of revenue 5.8% 3.9% 0.5 pts (0.3)pts
Operating cash flow (3) $493 $501 $331 $723
Cash and borrowing
(at end of period)
Cash and marketable
securities $1,278 $97
Borrowing 1,646 (276)
(1) Fourth Quarter 2001 and Full Year 2001 comparable amounts include
amortization of goodwill of $6 million ($4 million after-tax) and
$23 million ($17 million after-tax), respectively.
(2) Fourth Quarter 2002 amounts exclude costs related to restructuring
of $81 million ($51 million after-tax), of which $23 million was
recorded as selling, administrative and other expense. Full Year
2002 amounts exclude costs related to restructuring and other items
of $223 million ($142 million after-tax), of which $23 million was
recorded as selling, administrative and other expense; and the
write-down in the value of goodwill associated with the adoption of
SFAS 142 of $265 million after-tax. Full Year 2001 amounts exclude
costs related to restructuring items of $192 million ($121 million
after-tax), of which $42 million was recorded as selling,
administrative and other expense.
(3) Includes capital expenditures; excludes $17 million, $88 million,
$24 million and $94 million of cash paid related to restructuring
actions for Fourth Quarter 2002, Full Year 2002, Fourth Quarter 2001
and Full Year 2001, respectively; excludes $5 million of net cash
outflows and $10 million of net cash inflows related to the sale of
receivables in the Fourth Quarter 2002 and Full Year 2002,
respectively.
VISTEON CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
For the Years Ended
December 31, Fourth Quarter
2002 2001 2000 2002 2001
(in millions, except per share amounts)
Sales
Ford and
affiliates $14,779 $14,656 $16,448 $3,559 $3,671
Other customers 3,616 3,187 3,019 984 822
Total sales 18,395 17,843 19,467 4,543 4,493
Costs and expenses
Costs of sales 17,588 17,105 18,129 4,324 4,298
Selling,
administrative
and other
expenses 888 855 897 263 207
Total costs
and expenses 18,476 17,960 19,026 4,587 4,505
Operating income
(loss) (81) (117) 441 (44) (12)
Interest income 23 55 109 6 9
Interest expense 103 131 167 25 26
Net interest
expense (80) (76) (58) (19) (17)
Equity in net
income of
affiliated
companies 44 24 56 14 8
Income (loss)
before income
taxes, minority
interests and
change in
accounting (117) (169) 439 (49) (21)
Provision (benefit)
for income taxes (58) (72) 143 (23) (11)
Income (loss)
before minority
interests and
change in
accounting (59) (97) 296 (26) (10)
Minority interests
in net income
of subsidiaries 28 21 26 8 4
Income (loss)
before change in
accounting (87) (118) 270 (34) (14)
Cumulative effect
of change in
accounting,
net of tax (265) -- -- -- --
Net income
(loss) $(352) $(118) $270 $(34) $(14)
Basic and diluted
earnings (loss)
per share
Before cumulative
effect of change
in accounting $(0.68) $(0.91) $2.08 $(0.27) $(0.11)
Cumulative effect
of change in
accounting (2.07) -- -- -- --
Basic and
diluted $(2.75) $(0.91) $2.08 $(0.27) $(0.11)
Cash dividends
per share $0.24 $0.24 $0.12 $0.06 $0.06
VISTEON CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
December 31,
2002 2001
(in millions)
Assets
Cash and cash equivalents $1,204 $1,024
Marketable securities 74 157
Total cash and marketable securities 1,278 1,181
Accounts receivable - Ford and affiliates 1,401 1,560
Accounts receivable - other customers 828 834
Total receivables 2,229 2,394
Inventories 878 942
Deferred income taxes 199 167
Prepaid expenses and other current assets 153 153
Total current assets 4,737 4,837
Equity in net assets of affiliated companies 191 158
Net property 5,443 5,329
Deferred income taxes 566 322
Goodwill -- 363
Other assets 233 153
Total assets $11,170 $11,162
Liabilities and Stockholders' Equity
Trade payables $2,083 $1,915
Accrued liabilities 1,021 945
Income taxes payable 14 30
Debt payable within one year 348 629
Total current liabilities 3,466 3,519
Long-term debt 1,298 1,293
Postretirement benefits other than pensions 2,283 2,079
Other liabilities 1,142 967
Deferred income taxes 3 13
Total liabilities 8,192 7,871
Stockholders' equity
Capital stock
Preferred stock, par value $1.00, 50 million
shares authorized, none outstanding -- --
Common stock, par value $1.00, 500 million shares
authorized, 131 million shares issued, 129 million
and 130 million shares outstanding, respectively 131 131
Capital in excess of par value of stock 3,298 3,311
Accumulated other comprehensive (loss) (140) (231)
Other (33) (25)
Earnings retained for use in business
(accumulated deficit) (278) 105
Total stockholders' equity 2,978 3,291
Total liabilities and stockholders' equity $11,170 $11,162
VISTEON CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
For the Years Ended
December 31,
2002 2001 2000
(in millions)
Cash and cash equivalents
at January 1 $1,024 $1,412 $1,849
Cash flows provided by (used in)
operating activities 1,146 436 (526)
Cash flows from investing activities
Capital expenditures (723) (752) (793)
Acquisitions and investments
in joint ventures, net -- (7) (28)
Purchases of securities (508) (346) (126)
Sales and maturities of securities 588 260 61
Other 36 102 44
Net cash used in
investing activities (607) (743) (842)
Cash flows from financing activities
Commercial paper (repayments)
issuances, net (194) 8 352
Payments on short-term debt -- (1) (1,775)
Proceeds from issuance
of short-term debt -- 1 1,374
Proceeds from issuance
of other debt 115 114 1,279
Principal payments on other debt (245) (144) (290)
Purchase of treasury stock (24) (25) --
Cash dividends (31) (31) (16)
Other (4) 3 --
Net cash (used in) provided
by financing activities (383) (75) 924
Effect of exchange rate
changes on cash 24 (6) 7
Net increase (decrease) in cash
and cash equivalents 180 (388) (437)
Cash and cash equivalents
at December 31 $1,204 $1,024 $1,412
