Visteon Corporation Reports First Quarter 2000 Earnings of $147 Million
17 April 2000
Visteon Corporation Reports First Quarter 2000 Earnings of $147 Million
DEARBORN, Mich., April 17 Visteon Corporation earned $147
million during the First Quarter of 2000. This compares with earnings of $205
million during the same period a year ago. The reduction in earnings was more
than accounted for by a one-time price realignment of 5 percent that resulted
from a joint Ford-Visteon competitive pricing study. Adjusting 1999 for the
effects of this and other independence-related costs, earnings would have been
up $63 million, or 75%, versus last year.
First quarter 2000 revenue was $5.2 billion, up 9 percent compared with
1999; after-tax return on sales was 2.9 percent.
The earnings announcement comes a few days after Ford Motor Company
(NYSE: F) announced it would spin off Visteon to become an independent
company. As the third largest automotive supplier in the world, Visteon's new
legal entity will provide the corporation with more room to grow its non-Ford
business and expand its presence in the Aftermarket arena. However, the
corporation plans to continue fostering its long-standing relationship with
Ford.
"This is truly an exciting time for Visteon and its employees," said Peter
J. Pestillo, Chairman and CEO, Visteon. "Visteon's vision is to be the
world's leading supplier of integrated automotive technology systems. We have
the necessary systems integration expertise, the product quality, and global
reach, and with our new level of independence, our customer focus will be
stronger than ever."
In addition to Visteon's new independence, there have been several
highlights for its first quarter 2000:
* Visteon has accelerated its efforts to win additional business --
through the first quarter of 2000, Visteon had won $918 million of annualized,
incremental business versus $709 million for the same period last year. More
than 35 percent of the new business contracts won in the first quarter of 2000
were with non-Ford customers and 37 percent were with customers outside of
North America.
* Underscoring its commitment to being a leading automotive supplier of
electronics and innovative technologies, Visteon recently announced a joint
venture with Lernout & Hauspie (L&H) Speech Products NV of Belgium
(NYSE: LHSP). The venture will allow Visteon to capitalize on its automotive
voice technology leadership by combining its automotive expertise in voice-
user interface, multimedia, and telematics, with L&H's expertise in desktop
dictation, translation, natural language, and telephony voice applications.
* In January, at the Consumer Electronics Show, Visteon launched ICES
(Information, Communication, Entertainment, Safety and Security System), its
in-car computing platform. Through the use of simple voice commands, ICES
provides drivers with access to the Internet, where they can check e-mail and
obtain real-time information such as news, weather reports, and stock prices.
* The corporation opened two new Customer Service Centers in Ingolstadt,
Germany, and Mlada Boleslav, Czech Republic. The new offices will provide
even closer and speedier contact with Audi AG in Ingolstadt and Skoda.
Visteon Corporation is a leading full-service supplier that delivers
consumer-driven technology solutions to automotive manufacturers worldwide and
through multiple channels within the global automotive aftermarket. Visteon
has a global delivery system of more than 130 technical, manufacturing, sales,
and service facilities located in 23 countries. It has 81,000 employees
working in three core business segments: Dynamics and Energy Conversion;
Comfort, Communication and Safety; and Glass.
Consolidated Statement of Income
First Quarter
2000 1999
(Mils.) (Mils.)
Sales $5,225 $4,772
Cost and expenses
Cost of sales $4,795 $4,341
Selling, administrative, and other expenses 177 133
Total costs and expenses $4,972 $4,474
Operating income $253 $298
Interest income $25 $22
Interest expense 48 23
Net interest expense $(23) $(1)
Equity in net income of affiliated companies 7 16
Income before income taxes $237 $313
Provision for income taxes 86 112
Income before minority interests $151 $201
Minority interests in net income/
(loss) of subsidiaries 4 (4)
Net income $147 $205
Memo:
After-Tax Return on Sales 2.9% 4.2%