Superior Industries Reports Second Quarter and First Half Results
VAN NUYS, Calif.--July 27, 2005--Superior Industries International, Inc. today announced operating results for the second quarter and first half of 2005, and reported second quarter net income in line with management's prior guidance and analysts' expectations, prior to a favorable adjustment to the effective tax rate for the year.Second Quarter Results
For the three months ended June 30, 2005, revenue decreased 3.1% to $226,471,000 from $233,735,000 for the second quarter of 2004. Wheel revenue declined 4.5% to $217,827,000 from $228,137,000 on an 8.0% decline in unit wheel shipments. Components revenue increased 54.4% to $8,644,000 from $5,598,000.
Net income was $4,849,000, or $0.18 per diluted share. This compares to net income of $13,584,000, or $0.51 per diluted share, for the second quarter of 2004. The tax provision for the first half of 2005 reflects an estimated tax rate of 20.5%, compared to 24.5% reported in the first quarter. In addition to a favorable settlement of a tax issue with the Internal Revenue Service, the factors impacting the lower rate were the relationship of federal and state tax credits, changes in permanent tax differences, and foreign income, which is taxed at rates other than statutory, to a lower estimated pretax income for the year 2005. Excluding this change in the effective tax rate, which added $0.02 to diluted earnings per share in the second quarter, net income and earnings per share would have been in line with our prior guidance and analysts' estimates.
The company's share of profits from its joint venture aluminum wheel manufacturing operation in Hungary was $1,485,000 for this year's second quarter compared to $2,534,000 a year ago, reflecting lower shipments.
The operating loss from Superior's aluminum suspension components business was $2,618,000 for this year's second quarter compared to a loss of $1,549,000 for the same period of 2004.
At June 30, 2005, working capital was $274,112,000, including cash and short-term investments of $120,488,000.
First Half Results
For the six months ended June 30, 2005, revenue decreased 6.3% to $438,386,000 from $467,926,000 for the first half of 2004. Wheel revenue decreased 8.0% to $419,971,000 from $456,338,000 on a 12.6% decline in unit shipments. Components revenue increased 58.9% to $18,415,000 from $11,588,000 last year. Net income for the first six months of 2005 was $13,780,000, or $0.52 per diluted share, compared to $27,251,000, or $1.01 per diluted share, for the first six months of 2004.
Operations Review
As the company announced on June 10, 2005, orders for delivery in the second quarter declined more than originally anticipated, which affected plant utilization, work schedules, and gross margin for the period. "In the short term, we expect a continuation of the intense competitive environment we have faced for some time and which has affected automotive industry suppliers throughout the world. We are focused on completing the implementation of our cost-reduction program built on efficiency enhancement and automation in all of our plants," said President and Chief Executive Officer Steven Borick.
"In the long term, we remain optimistic about our opportunities as we transform Superior into a truly global company. Construction of our third facility in Mexico, which will set the world standard for cast aluminum wheel manufacturing when it comes on-line in 2006, remains on schedule. We are continuing to evaluate opportunities to apply our manufacturing expertise and technological know-how in other developing markets. While it will take time to achieve our goals, we are fortunate to have the management, technical, and financial resources to stay the course."
About Superior Industries
Superior supplies aluminum wheels and other aluminum automotive components to Ford, General Motors, DaimlerChrysler, Audi, BMW, Isuzu, Jaguar, Land Rover, Mazda, MG Rover, Mitsubishi, Nissan, Subaru, Toyota, and Volkswagen. For additional information, visit www.supind.com.
SUPERIOR INDUSTRIES INTERNATIONAL, INC.
Consolidated Statements of Income (Unaudited)
(Dollars in Thousands, Except Per Share Amounts)
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Three Months Ended Six Months Ended
June 30, June 30,
---------------------- -----------------------------------------------
2005 2004 2005 2004
NET SALES $226,471 $233,735 $438,386 $467,926
Costs and Expenses
Cost of Sales 218,311 210,424 416,072 420,044
Selling and
Administrative
Expenses 5,265 5,998 10,323 11,880
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INCOME FROM OPERATIONS 2,895 17,313 11,991 36,002
Equity in Earnings
of Joint Ventures 1,490 2,554 3,157 4,737
Interest Income,
net 1,388 547 2,513 1,138
Miscellaneous
Income (Expense),
net (269) 326 (328) (272)
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INCOME BEFORE INCOME
TAXES 5,504 20,740 17,333 41,605
Income Taxes 655 7,156 3,553 14,354
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NET INCOME $4,849 $13,584 $13,780 $27,251
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EARNINGS PER SHARE:
Basic $0.18 $0.51 $0.52 $1.02
Diluted $0.18 $0.51 $0.52 $1.01
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WEIGHTED AVERAGE AND
EQUIVALENT SHARES
OUTSTANDING:
Basic 26,613,000 26,634,000 26,619,000 26,684,000
Diluted 26,618,000 26,806,000 26,628,000 26,908,000
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SUPERIOR INDUSTRIES INTERNATIONAL, INC.
Consolidated Balance Sheets (Unaudited)
(Dollars in Thousands)
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June 30,
---------------------------------
2005 2004
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Current Assets $369,620 $412,072
Property, Plant and Equipment, net 301,281 276,224
Investments and Other Assets 85,791 59,528
------------------------------------ ---------------- ----------------
$756,692 $747,824
------------------------------------ ---------------- ----------------
Current Liabilities $95,508 $114,325
Long-Term Liabilities 52,400 42,714
Shareholders' Equity 608,784 590,785
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$756,692 $747,824
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