Gentex Reports Record Financial Results for the Fourth Quarter and Year
ZEELAND, Mich., Jan. 27, 2004 -- Gentex Corporation, the Zeeland, Michigan-based manufacturer of automatic-dimming rearview mirrors and commercial fire protection products, today reported record revenues and net income for the fourth quarter and year ended December 31, 2003.
The Company achieved record fourth quarter revenues of $123.9 million, a 15 percent increase over the fourth quarter of 2002 when the Company reported revenues of $107.3 million. Net income in the 2003 fourth quarter increased 21 percent to $29.1 million, or 37 cents per share, compared with net income of $24.1 million, or 31 cents per share in 2002.
For the year ended December 31, 2003, Gentex reported a 24 percent increase in net income to $106.8 million, or $1.37 per share, on a 19 percent increase in revenues to $469.0 million. The Company reported net income of $85.8 million, or $1.12 per share, on revenues of $395.3 million in 2002.
"We are pleased with the record financial results that we achieved for both the fourth quarter and calendar year 2003," said Gentex Executive Vice President Garth Deur. "The penetration of auto-dimming mirrors continues to increase on a global basis as our customers offer auto-dimming plus other mirror-borne electronic features to consumers in nearly every vehicle segment that exists today."
Total auto-dimming mirror unit shipments in the fourth quarter of 2003 increased by 20 percent over the same quarter last year to 2.7 million units. For calendar year 2003, total mirror unit shipments increased by 17 percent to a record 10.3 million units, compared with calendar year 2002.
Automotive revenues increased by 15 percent from $102.8 million in the fourth quarter of 2002 to $118.2 million in the fourth quarter of 2003. For calendar year 2003, automotive revenues increased by 19 percent from $374.2 million in 2002 to $446.3 million in 2003.
Deur said that the Company continued to ship an increasing number of mirrors that include advanced electronic features beyond automatic dimming, such as compass and temperature displays, LED turn signals, HomeLink, LED map lamps or PRNDL lighting, etc. The majority of the mid-size vehicle models utilizing the Company's auto-dimming mirrors also offer one or more of these features in the mirror. In calendar year 2003, approximately 56 percent of the total interior mirror units that the Company shipped had one or more of those features, compared with 53 percent in 2002 and 41 percent in 2001.
Deur added that he believes that the growth prospects remain positive for automotive unit shipments in calendar 2004.
"We currently estimate that we can potentially achieve a 10-15 percent year-over-year rate of growth in unit shipments in calendar 2004 compared with 2003," said Deur. This estimate is based on recent J.D. Power expectations for light vehicle industry production in North America and Western Europe in calendar 2004 of approximately 16.3 million and 16.1 million vehicles, respectively. (**)
Revenues in the Fire Protection Products Group increased by 25 percent from $4.6 million in the fourth quarter of 2002 to $5.7 million in the fourth quarter of 2003. Revenues for calendar year 2003 increased by eight percent from $21.0 million in 2002 to $22.7 million in 2003. The increased revenues for both periods is due to higher demand for signaling devices, as well as general improvement in this industry sector.
On January 22, 2004, the Company paid a cash dividend of $0.15 per share to shareholders of record of the common stock at the close of business on January 8, 2004. The ex-dividend date was January 6, 2004. Due to the required period of time for the settlement of stock trades, this means that you must have purchased shares of Gentex common stock on or before January 2, 2004, in order to have received this cash dividend.
(**) Certain matters discussed in this news release, including unit shipment growth rate projections and estimates, are forward-looking statements which involve certain risks and uncertainties, and are subject to change based on various market, industry and other important factors. The Company cautions investors that numerous factors (some of which are outlined in the Company's Form 10-K filed with the Securities and Exchange Commission and other interim reports) and future events may affect the Company's actual results, and may cause those results to differ materially from those expressed in this news release. Furthermore, Gentex undertakes no obligation to update, amend, or clarify forward-looking statements whether as a result of new information, future events, or otherwise.
A conference call related to this news release will be simulcast live on the Internet beginning today at 9:30 a.m. Eastern Standard Time. To access that call, go to www.gentex.com and select "Audio Webcast" from the lower right corner of that home page. Other conference calls hosted by the Company will also be available at that site in the future.
Gentex Corporation is an international company that provides high-quality products to the worldwide automotive industry and North American fire protection market.
The Company develops, manufactures and markets interior and exterior automatic-dimming automotive rearview mirrors that utilize proprietary electrochromic technology to dim in proportion to the amount of headlight glare from trailing vehicle headlamps. More than 95 percent of the Company's revenue is derived from the sale of those products to the world automotive industry.
Gentex was the first company in the world to successfully develop and produce a commercial automatic-dimming rearview mirror. After more than 15 years of supplying these products in the highly competitive global automotive industry, the Company remains the leading supplier of these mirrors. Gentex OEM customers include Acura, Audi, Bentley, BMW, DaimlerChrysler, Fiat, Ford, General Motors, Honda, Hyundai, Infiniti, Isuzu, Kia Motors, Lexus, Mazda, Mitsubishi, Nissan, Opel, Renault Samsung, Rover, Rolls Royce, SsangYong Motors, Toyota, Volkswagen and Volvo Car Corporation.
Founded in 1974, Gentex has its manufacturing facilities in Zeeland, Michigan, and automotive sales and engineering offices in Detroit, Michigan; Germany, Japan, the United Kingdom, France and Korea. The Company is recognized for its quality products; for its proprietary manufacturing skills and equipment and application of world class manufacturing principles; for its commitment to developing and maintaining a highly skilled workforce, and for encouraging employee ownership of the Company's stock.
GENTEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended
December 31,
2003 2002
Net Sales $123,914,515 $107,347,349
Costs and Expenses
Cost of Goods Sold 70,896,590 62,651,572
Engineering, Research & Development 7,151,010 5,789,209
Selling, General & Administrative 6,001,114 6,047,132
Other Expense (Income) (3,218,392) (2,816,601)
Total Costs and Expenses 80,830,322 71,671,312
Income Before Income Taxes 43,084,193 35,676,037
Provision for Income Taxes 14,003,000 11,596,000
Net Income $29,081,193 $24,080,037
Earnings Per Share
Basic $0.38 $0.32
Diluted $0.37 $0.31
Weighted Average Shares:
Basic 76,633,413 75,913,348
Diluted 78,154,561 76,845,120
Year Ended
December 31,
2003 2002
Net Sales $469,019,365 $395,258,436
Costs and Expenses
Cost of Goods Sold 272,518,466 235,611,182
Engineering, Research & Development 26,613,770 22,973,027
Selling, General & Administrative 23,311,853 21,474,066
Other Expense (Income) (11,588,919) (11,872,630)
Total Costs and Expenses 310,855,170 268,185,645
Income Before Income Taxes 158,164,195 127,072,791
Provision for Income Taxes 51,403,000 41,301,500
Net Income $106,761,195 $85,771,291
Earnings Per Share
Basic $1.39 $1.14
Diluted $1.37 $1.12
Weighted Average Shares:
Basic 76,584,876 75,515,271
Diluted 77,684,490 76,602,402
CONDENSED CONSOLIDATED BALANCE SHEETS
Dec 31, Dec 31,
2003 2002
ASSETS
Cash and Short-Term Investments $393,606,656 $215,650,801
Other Current Assets 91,742,675 61,147,608
Total Current Assets 485,349,331 276,798,409
Plant and Equipment - Net 126,806,882 124,982,665
Long-Term Investments and Other Assets 150,373,553 207,391,593
Total Assets $762,529,766 $609,172,667
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities $50,480,480 $29,060,035
Long-Term Debt 0 0
Deferred Income Taxes 18,405,955 6,472,270
Shareholders' Investment 693,643,331 573,640,362
Total Liabilities & Shareholders'
Investment $762,529,766 $609,172,667
NVS MIRROR UNIT SHIPMENTS
(Thousands)
Fourth Quarter Year Ended
Ended December 31, December 31,
2003 2002 % Change 2003 2002 % Change
Domestic Interior 1,026 872 18% 3,863 3,498 10%
Domestic Exterior 436 396 10% 1,730 1,539 12%
Total Domestic Units 1,462 1,268 15% 5,592 5,037 11%
Foreign Interior 891 760 17% 3,269 2,807 17%
Foreign Exterior 363 239 52% 1,399 962 45%
Total Foreign Units 1,254 998 26% 4,668 3,769 24%
Total Interior Mirrors 1,917 1,631 18% 7,132 6,305 13%
Total Exterior Mirrors 799 635 26% 3,128 2,501 25%
Total Mirror Units 2,716 2,266 20% 10,260 8,806 17%
Note: Certain prior year amounts have been reclassified to conform with the current year presentation. Amounts may not total due to rounding.