Visteon Earnings Increase 32% to Record $150 Million in Q3
14 October 1998
Visteon Earnings Increase 32 Percent to Record $150 Million in Third Quarter
DEARBORN, Michigan, Oct. 14 -- Visteon Automotive Systems net
income for the third quarter of 1998 was a record $150 million, up 32 percent
from $114 million earned in the same quarter last year. Third-quarter 1998
revenue was $4.1 billion with after-tax return on sales for the quarter at
3.7 percent, up 8/10 of a point from year-ago levels.
"Visteon continues to build a strong operational and financial track
record. For the third consecutive quarter, Visteon has delivered improved
results over the prior year," said Charles W. Szuluk, president, Visteon
Automotive Systems. "These results are a clear indication that our strategy
to make our customers successful is working. Executing this strategy will
result in Visteon meeting or exceeding every milestone we have set for this
year."
Szuluk noted several important achievements during the first nine months
of 1998, including securing more than $1.8 billion in new forward-year
business contracts - 45 percent from non-Ford customers - well ahead of
Visteon's full-year target of $1.5 billion. Visteon also reduced costs in the
third quarter by nearly $90 million, bringing the nine-month total to just
over $290 million - exceeding its full-year target. In the product arena,
Visteon introduced its super-integrated cockpit at the Paris Motor Show, an
industry first which leverages the engineering capabilities of most of its
systems divisions.
"The numbers clearly demonstrate that Craig Muhlhauser and his team have
done an outstanding job of winning business with new customers for Visteon,"
said Szuluk. "As Visteon moves into the next millennium, Craig is the right
leader to execute Visteon's strategy to grow the business."
For the first nine months of 1998, Visteon's net income was $580 million,
up 23 percent from 1997. Revenue for the first nine months of 1998 was $13.2
billion, up 3 percent from 1997, with after-tax return on sales of 4.4
percent, up 7/10 of a point.
During the third quarter, Visteon announced moves to strengthen its
position in providing leading-edge technology solutions to its customers
including the acquisition of Zexel Innovation, now Visteon Technologies, to
provide world-class navigation systems to its customers, and forming a 50-50
partnership with Pi Technologies, a leading automotive electronics and
software engineering company in Cambridge, England, to enhance capabilities in
powertrain control systems.
Visteon continues to focus on growing its business with OEM customers,
increasing non-Ford sales, expanding its presence in the aftermarket arena and
leveraging its systems technology in non-automotive markets.
Visteon, an enterprise of Ford Motor Company , has 82,000
employees located in 21 countries. Visteon has 81 plants - 32 joint ventures
and 49 wholly owned facilities -- and 35 sales offices, engineering and
technical centers. Visteon's corporate headquarters is located in Dearborn,
Mich.
Visteon Automotive Systems
Consolidated Statement of Income
Third Quarter Nine Months
1998 1997 1998 1997
(Mils.) (Mils.) (Mils.) (Mils.)
Revenue $4,097 $3,937 $ 13,200 $ 12,810
Cost and expenses
Cost of goods sold 3,681 3,627 11,754 11,681
Selling, administrative,
and other expenses 172 127 512 389
Total costs and expenses$3,853 $3,754 $ 12,266 $12,070
Operating income $244 $183 $934 $740
Interest
Interest income 21 3 35 12
Interest expense 27 20 71 60
Net interest expense $ (6) $(17) $(36) $(48)
Equity in net income
of affiliated companies 5 19 21 35
Income before taxes $243 $185 $919 $727
Provision for income taxes 92 70 339 256
Income before minority
interests $151 $115 $580 $471
Minority interests in net
income of subsidiaries 1 1 0 1
Net income $150 $114 $580 $470
Memo: After-tax return
on sales 3.7% 2.9% 4.4% 3.7%