Delphi Board Declares Quarterly Dividend
7 December 1999
Delphi Board Declares Quarterly Dividend
TROY, Mich., Dec. 7 -- The Delphi Automotive Systems
Board of Directors today declared a quarterly dividend of $0.07
per share on Delphi $0.01 par value common stock. The dividend is payable
Jan. 13, 2000 to shareholders of record as of the close of business Dec. 16,
1999.
"Today's dividend declaration is representative of Delphi's commitment to
long-term shareholder return," said Delphi Chairman, Chief Executive Officer
and President J.T. Battenberg III. "The dividend is just one of many ways
that we are rewarding shareholders for their investment in our company,"
Battenberg said.
"We will be able to provide more detail when we announce fourth quarter
and year-end financials next month. However, as of the end of the third
quarter, we believe we were solidly on track to achieve our financial
objectives," said Battenberg. "These objectives include 10 percent annual
growth in non-GM sales, net margin improvement of at least 0.5 percent in
1999, and earnings per share growth of 10 percent. Today's dividend
declaration, combined with our year-to-date financial performance, sends a
clear signal to the investment community that we are delivering on our
commitment to shareholders," said Battenberg.
Highlights of Delphi's business strategy designed to deliver enhanced
shareholder value include:
* Record levels of new business -- both with General Motors and with
customers other than General Motors. Of $25 billion in new business booked
through the end of the third quarter, $7 billion (28 percent), was with
customers other than General Motors.
* As a percentage of 1999 sales through the third quarter, sales to
customers other than General Motors grew 13 percent year-over-year, after
adjusting for the impact of businesses divested in late 1998.
* Successful negotiation with our two major U.S. labor unions of national
contracts covering over 50,000 hourly employees.
* Delphi's annual operating cash flow -- through the third quarter -- was
$1.9 billion, and is currently expected to come in at, or above, the high end
of an historical annual average of between $1.5 billion and $2.0 billion.
* This continued strong operating cash flow has provided flexibility for
$900 million in year-to-date pension fund contributions, significantly
reducing long-term liability in this area.
* Additionally our cash position enabled Delphi to enter into an
agreement in late November to purchase Lucas Diesel Systems for approximately
$871 million in cash. The transaction, which is subject to receipt of
regulatory approvals and other customary closing conditions, will expand
Delphi's customer and technology presence in the strategically important
European diesel market. Additionally, the transaction is expected to exceed
our 2002 net income margin objective of 5 percent, surpass our RONA objective
of 12.5 percent, be accretive to earnings in 2000, and generate a superior
return on investment.
* New products -- among others -- introduced so far in 1999 that
demonstrate Delphi's commitment to electronic technology include:
Communiport(R) Mobile Multimedia, E-Steer(TM) electronic power steering,
MagneRide(TM) suspension control systems, and Forewarn Adaptive Cruise
Control.
"Our ability to hit our financial targets and introduce cutting-edge
technology in an increasingly competitive marketplace is at the heart of
Delphi's value proposition," said Battenberg. "We are looking forward to a
strong close of what has been an extremely exciting first year as a publicly
traded technology company."
Delphi Automotive Systems, headquartered in Troy, Mich., USA, is a world
leader in automotive components and systems technology. Delphi's three
business sectors -- Dynamics & Propulsion; Safety, Thermal & Electrical
Architecture; and Electronics & Mobile Communications -- provide comprehensive
product solutions to complex customer needs. Delphi has approximately 201,000
employees and operates 168 wholly owned manufacturing sites, 38 joint
ventures, 51 customer centers and sales offices and 27 technical centers in 36
countries. Regional headquarters are located in Paris, Tokyo and Sao Paulo.
Delphi can be found on the Internet at http://www.delphiauto.com .
This press release, other than historical financial information, contains
forward-looking statements that involve a number of risks and uncertainties.
Important factors that could cause actual results to vary materially from
those anticipated in the forward-looking statements are set forth in Delphi's
Securities and Exchange filings, including without limitation, in Items 1 and
7 of Delphi's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998, and Item 2 of Delphi's Quarterly Reports on Form 10-Q for
the quarters ended March 31, June 30, and Sept. 30, 1999.