Gentex Reports Record Second Quarter Revenues and Net Income
ZEELAND, Mich., July 20 -- Gentex Corporation, the Zeeland, Michigan-based manufacturer of automatic-dimming rearview mirrors and commercial fire protection products, today reported record second quarter revenues and net income for the quarter ended June 30, 2004.
The Company achieved another quarterly sales record in the second quarter of 2004 with revenues of $129.6 million, an 11 percent increase over revenues of $116.9 million reported in the second quarter last year. Record second quarter net income of $29.0 million increased by 11 percent compared with net income of $26.1 million in the comparable 2003 quarter. Earnings per share were 37 cents in the second quarter of 2004 compared with 34 cents in the second quarter of 2003.
For the first six months of 2004, the Company posted record net income of $58.8 million, or 75 cents per share, on record revenues of $259.0 million, compared with net income of $52.0 million, or 68 cents per share, on revenues of $232.2 million, for the same period in 2003.
"We are pleased to report that our auto-dimming mirror unit shipments increased by over 18 percent in the second quarter compared to the same quarter last year," said Gentex Executive Vice President Garth Deur. "As was the case in the first quarter of 2004, that growth primarily came in the form of base feature interior mirrors for international customers."
Deur said that the stability in the Company's gross margins in the second quarter was attributable to continued manufacturing efficiencies and improved capacity utilization, despite continued customer price reductions.
The Company has begun making production shipments of its new SmartBeam(TM) product for 2005 Cadillac STS and 2005 Jeep Grand Cherokee models, according to Deur. He stated that consumers will start to see the new technology in dealer showrooms this fall, and that SmartBeam is offered in an option package on each of those models. SmartBeam is the intelligent high-beam headlamp control product developed by the Company.
"We're very pleased to announce that we've launched SmartBeam, and will continue to make significant investments in this technology as we work to apply it to more vehicle models at numerous auto companies," said Deur. "We're making significant progress with customers in Europe, and are currently working under a letter of intent with a European customer to develop SmartBeam for a number of vehicle platforms. Production of SmartBeam systems for those platforms could commence as early as 2006."
Total auto-dimming mirror unit shipments for the second quarter of 2004 increased by 18 percent to 3,001,000 units, compared with 2,534,000 units for the same quarter in 2003. Total automotive revenues in the second quarter of 2004 increased by 12 percent to $123.8 million, compared with the same quarter last year.
Total auto-dimming mirror unit shipments for the first six months of 2004 increased by 18 percent to 5,983,000 units, compared with 5,069,000 units for the same period in 2003. Total automotive revenues increased by 12 percent for the first six months of 2004 to $247.6 million, compared with the same period in 2003.
Auto-dimming mirror unit shipments to offshore and North American customers increased by 37 percent and 4 percent, respectively, in the second quarter of 2004 compared with the second quarter of 2003. Light vehicle production was flat in Western Europe and increased by 15 percent in the Asia/Pacific region, compared with the same quarter last year. During the second quarter of 2004, light vehicle production in North America increased two percent compared with the same quarter last year.
For the first six months of 2004, auto-dimming mirror unit shipments to offshore and North American customers increased by 31 percent and 7 percent, respectively, compared with the first six months of 2003. During the first six months of 2004, light vehicle production was flat in Western Europe and increased by 13 percent in the Asia/Pacific region, compared with the first six months of 2003. Light vehicle production in North America increased one percent for the first six months of 2004 compared with the same period last year.
Revenues in the Company's Fire Protection Products Group decreased by three percent in the second quarter of 2004 to $5.8 million, compared with the second quarter last year. For the first six months of 2004, fire protection revenues increased by two percent to $11.4 million.
Founded in 1974, Gentex Corporation is an international company that provides high-quality products to the worldwide automotive industry and North American fire protection market. Based in Zeeland, Michigan, 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. Many of the mirrors are sold with advanced electronic features, and more than 95 percent of the Company's revenues are derived from the sales of auto-dimming mirrors to nearly every major automaker in the world.
AUTO-DIMMING MIRROR UNIT SHIPMENTS
(Thousands)
Second Quarter Six Months Ended
Ended June 30, June 30,
2004 2003 % Change 2004 2003 % Change
Domestic Interior 1,006 968 4% 2,077 1,923 8%
Domestic Exterior 445 434 3% 908 859 6%
Total Domestic Units 1,452 1,403 4% 2,984 2,782 7%
Foreign Interior 1,138 802 42% 2,205 1,604 37%
Foreign Exterior 411 329 25% 794 683 16%
Total Foreign Units 1,550 1,131 37% 2,999 2,287 31%
Total Interior Mirrors 2,145 1,770 21% 4,281 3,527 21%
Total Exterior Mirrors 856 764 12% 1,702 1,542 10%
Total Mirror Units 3,001 2,534 18% 5,983 5,069 18%
Note: Certain prior year amounts have been reclassified to conform with the current year presentation. Amounts may not total due to rounding.
GENTEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
Three Months Ended
June 30,
2004 2003
Net Sales $129,646,277 $116,917,332
Costs and Expenses
Cost of Goods Sold 75,190,805 68,635,744
Engineering, Research &
Development 7,546,085 6,310,886
Selling, General & Administrative 6,880,091 6,090,320
Other Expense (Income) (2,910,496) (2,771,957)
Total Costs and Expenses 86,706,485 78,264,993
Income Before Provision
for Income Taxes 42,939,792 38,652,339
Provision for Income Taxes 13,955,000 12,562,000
Net Income $28,984,792 $26,090,339
Earnings Per Share
Basic $0.38 $0.34
Diluted $0.37 $0.34
Weighted Average Shares:
Basic 77,061,942 75,992,364
Diluted 78,415,929 76,878,488
Cash Dividends Declared per Share $0.15 $0.00
Six Months Ended
June 30,
2004 2003
Net Sales $258,973,825 $232,225,896
Costs and Expenses
Cost of Goods Sold 149,634,081 135,828,313
Engineering, Research & Development 14,989,373 12,518,622
Selling, General & Administrative 13,625,212 11,616,996
Other Expense (Income) (6,385,108) (4,772,912)
Total Costs and Expenses 171,863,558 155,191,019
Income Before Provision
for Income Taxes 87,110,267 77,034,877
Provision for Income Taxes 28,310,000 25,036,000
Net Income $58,800,267 $51,998,877
Earnings Per Share
Basic $0.76 $0.68
Diluted $0.75 $0.68
Weighted Average Shares:
Basic 76,960,647 75,974,343
Diluted 78,432,048 76,813,994
Cash Dividends Declared per Share $0.30 $0.00
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
June 30, Dec 31,
2004 2003
ASSETS
Cash and Short-Term Investments $457,894,414 $393,606,656
Other Current Assets 97,173,482 91,742,675
Total Current Assets 555,067,896 485,349,331
Plant and Equipment - Net 130,289,256 126,806,882
Long-Term Investments and Other
Assets 132,298,090 150,373,553
Total Assets $817,655,242 $762,529,766
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities $56,788,070 $50,480,480
Long-Term Debt 0 0
Deferred Income Taxes 18,871,276 18,405,955
Shareholders' Investment 741,995,896 693,643,331
Total Liabilities & Shareholders' Investment $817,655,242 $762,529,766