Gentex Reports Record Revenues and Net Income
14 July 1998
Gentex Reports Record Revenues and Net Income for the Second Quarter of 1998
ZEELAND, Mich., July 14 -- Gentex Corporation ,
the Zeeland, Michigan-based manufacturer of automatic-dimming rearview mirrors
and commercial fire protection products, today reported record financial
results for the second quarter and six months ended June 30, 1998.
The Company reported record net income of $10.8 million, or 15 cents per
share, on record revenues of $51.4 million for the second quarter ended
June 30, 1998. In the comparable 1997 quarter, the Company reported net
income of $8.0 million, or 11 cents per share, on revenues of $44.9 million.
For the first six months of 1998, net income increased to $23.3 million or
32 cents per share on record revenues of $108.4 million. For the comparable
1997 period, Gentex reported net income of $15.4 million, or 22 cents per
share, on revenues of $86.8 million.
All per share data are diluted and adjusted to reflect the two-for-one
stock split, effected in the form of a 100 percent common stock dividend, on
June 22, 1998. Diluted weighted average shares outstanding for the quarter
ended June 30, 1998, were 73,807,749 compared with 71,624,684 for the same
period in 1997. For the six-month period ended June 30, 1998, diluted
weighted average shares outstanding were 73,584,918 compared with 71,571,266
for the same 1997 period.
"We had a very good second quarter, despite the impact of the GM strikes,"
said Gentex Executive Vice President Kenneth La Grand. "We estimate that the
GM strikes cost us about two cents per share in the second quarter. However,
unit shipments to customers in North America still increased by 45 percent,
even though North American light vehicle production decreased by about four
percent." La Grand said that unit shipments to offshore customers decreased
by about five percent, primarily due to decreased shipments of interior
mirrors to the Asia/Pacific region.
Total Night Vision Safety(TM) (NVS(R)) Mirror shipments in the second
quarter were 1.1 million, a 25 percent increase over the 897,000 units
reported in the same 1997 quarter. Exterior mirrors accounted for 357,000 of
the total mirror shipments in the second quarter of 1998, compared with
222,000 units in the same quarter last year.
For the first six months of 1998, total unit shipments reached a record
2.4 million, a 36 percent increase over the first six months of 1997. For
that same six-month period in 1998, exterior mirror shipments were 738,000, a
72 percent gain over the 429,000 exterior mirror units shipped during the
first six months of 1997.
The Company's Fire Protection Products Group reported a decrease in
revenues of about 4 percent for both the second quarter and first six months
of 1998. La Grand cited decreased sales of certain signals and generally soft
industry sales as the primary reasons for the decline.
Certain matters discussed in this news release 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 (as outlined in the Company's
Form 10-K filed with the Securities and Exchange Commission and other interim
reports) in some cases may affect in the future the Company's actual results,
and may cause those results to differ materially from those expressed in this
news release.
Gentex Corporation (The Nasdaq Stock Market: GNTX) 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 proprietary electro-optic products, including
interior and exterior electrochromic, automatic-dimming Night Vision
Safety(TM) (NVS(R)) automotive rearview mirrors that dim in proportion to the
amount of headlight glare from trailing vehicle headlamps, and an extensive
line of fire protection products for commercial applications. Revenues from
the sale of automatic-dimming mirrors represent about 90 percent of total
Company revenues.
Gentex was the first company in the world to successfully develop and
produce a commercial electrochromic mirror for the motor vehicle industry.
The Company is the leading supplier of these mirrors to the worldwide
automotive industry. Gentex customers include Audi, Bentley, BMW, Chrysler,
Daewoo, Fiat, Ford, General Motors, Gulf States Toyota, Honda, Hyundai,
Infiniti, Kia Motors, Lexus, Mercedes-Benz, Mitsubishi, Nissan, Opel, Porsche,
Rolls Royce, Southeast Toyota Distributors and Toyota.
Founded in 1974, Gentex operates out of three facilities in Zeeland,
Michigan; an automotive sales and marketing office in Livonia, Michigan;
automotive sales and engineering subsidiaries in Germany and Japan; and five
regional U.S. sales offices for the Fire Protection Products Group. The
Company is recognized for its quality products, its 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
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
1998 1997 1998 1997
Net Sales $51,371,749 $44,873,334 $108,351,151 $86,775,456
Costs and Expenses
Cost of Goods
Sold 31,569,068 29,068,728 65,909,577 56,238,684
Research &
Development 2,711,514 2,406,945 5,290,743 4,484,212
Selling, General &
Administrative 3,055,195 2,779,137 6,091,208 5,469,528
Other Expense
(Income) (1,971,546) (1,234,322) (3,523,178) (2,209,093)
Total Costs and
Expenses 35,364,231 33,020,488 73,768,350 63,983,331
Income Before Provision
for Income
Taxes 16,007,518 11,852,846 34,582,801 22,792,125
Provision for Income
Taxes 5,243,000 3,852,000 11,317,000 7,407,000
Net Income $10,764,518 $8,000,846 $23,265,801 $15,385,125
Earnings Per Share
Basic $0.15 $0.11 $0.33 $0.22
Diluted $0.15 $0.11 $0.32 $0.21
Weighted Average Shares:
Basic 71,560,230 69,900,136 71,332,350 69,869,560
Diluted 73,807,749 71,624,684 73,584,918 71,571,266
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
June 30, Dec. 31,
1998 1997
ASSETS
Cash and Short-Term Investments $59,337,332 $41,131,383
Other Current Assets 31,769,393 34,788,053
Total Current Assets 91,106,725 75,919,436
Plant and Equipment - Net 57,391,333 42,238,885
Long-Term Investments and Other Assets 75,661,031 71,624,526
Total Assets $224,159,089 $189,782,847
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities $15,298,275 $14,591,224
Long-Term Debt 0 0
Deferred Income Taxes 2,875,735 1,986,446
Shareholders' Investment 205,985,079 173,205,177
Total Liabilities & Shareholders'
Investment $224,159,089 $189,782,847
Note: All earnings per share amounts and weighted daily average shares
outstanding reflect the 2-for-1 stock split effected in the form of a 100%
common stock dividend effective on June 22, 1998.