Visteon Corporation (NASDAQ: VC) today announced first-quarter 2019
results, reporting net income attributable to Visteon of $14
million or $0.49 per diluted share, compared with $65 million or
$2.11 per diluted share in the first quarter of 2018.
First-quarter 2019 sales were $737 million,
compared with $814 million in the first quarter of 2018. The
decrease of $77 million is primarily due to unfavorable vehicle
production volumes, customer pricing net of design changes, and
unfavorable currency, partially offset by new business. Gross
margin for the first quarter of 2019 was $66 million, compared with
$129 million in the first quarter of 2018. The decrease is
primarily due to lower sales, launch challenges with a curved
center information display, inefficiencies associated with a plant
transfer in Mexico, and timing of engineering expense.
During the first quarter, global vehicle
manufacturers awarded Visteon new business of $1.4 billion in
lifetime sales. New business win growth was driven by
next-generation digital products, primarily all-digital clusters,
advanced displays and SmartCore™. U.S.-based vehicle manufacturers
accounted for half of the first-quarter total.
"Sales were in line with our expectations, despite
the challenging vehicle production environment," said Visteon
President and CEO Sachin Lawande. "The operational challenges that
affected our margins are expected to diminish and be largely
resolved in the second and third quarters. Our new business wins
were strong and well-aligned with key industry technology trends,
with one-third for electric vehicles including battery management
systems. We are also pleased to extend our success in the
commercial vehicle segment with the addition of a second heavy-duty
truck customer."
First Quarter in Review
Sales totaled $737 million and $814 million during
the first quarter of 2019 and 2018, respectively. On a regional
basis, in the first quarter of 2019 Europe accounted for 33 percent
of sales, the Americas 24 percent, China Domestic 14 percent, China
Export 9 percent, and Other Asia-Pacific 20 percent.
Gross margin for the first quarter of 2019 and
2018 was $66 million and $129 million, respectively. Adjusted
EBITDA, a non-GAAP measure as defined below, was $41 million for
the first quarter of 2019, compared with $104 million for the same
quarter last year. Adjusted EBITDA margin was 5.6 percent for the
first quarter of 2019, 720 basis points lower than the same period
in the prior year.
For the first quarter of 2019, net income
attributable to Visteon was $14 million or $0.49 per diluted share,
compared with $65 million or $2.11 per diluted share for the same
period in 2018. Adjusted net income, which excludes restructuring
charges and discontinued operations, was $15 million or $0.53 per
diluted share for the first quarter of 2019, compared with $64
million or $2.08 per diluted share for the same period in 2018. The
company had 28.5 million of diluted shares of common stock
outstanding as of March 31, 2019, and is authorized to purchase an
additional $400 million of shares through Dec. 31, 2020.
Cash and Debt Balances
As of March 31, 2019, Visteon had cash totaling
$435 million. Total debt as of March 31, 2019, was $404
million.
For the first quarter of 2019, cash provided from
operations was $4 million and capital expenditures were $37
million. Total Visteon adjusted free cash flow, a non-GAAP
financial measure as defined below, for the first quarter was a use
of $30 million, compared with $48 million provided during the first
quarter of 2018.
Full-Year 2019 Outlook
Visteon updated its full-year 2019 guidance, with
sales in the range of $2.90 billion to $3.00 billion, adjusted
EBITDA in the range of $245 million to $270 million, and adjusted
free cash flow in the range of $45 million to $70 million.
About Visteon
Visteon is a global technology company that
designs, engineers and manufactures innovative cockpit electronics
and connected car solutions for the world’s major vehicle
manufacturers. Visteon is driving the smart, learning, digital
cockpit of the future, to improve safety and the user experience.
Visteon is a global leader in cockpit electronic products including
digital instrument clusters, information displays, infotainment,
head-up displays, telematics, SmartCore™ cockpit domain
controllers, and the DriveCore™ autonomous driving platform.
Visteon also delivers artificial intelligence-based technologies,
connected car, cybersecurity, interior sensing, embedded multimedia
and smartphone connectivity software solutions. Headquartered in
Van Buren Township, Michigan, Visteon has approximately 10,000
employees at more than 40 facilities in 18 countries. Visteon had
sales of approximately $3 billion in 2018. Learn more at
www.visteon.com.
Conference Call and
Presentation
Today, Thursday, Apr. 25, at 9 a.m. ET, the company
will host a conference call for the investment community to discuss
the quarter’s results and other related items. The conference call
is available to the general public via a live audio webcast.
The dial-in numbers to participate in the call
are:U.S./Canada: 866-411-5196Outside U.S./Canada: 970-297-2404
(Call approximately 10 minutes before the start
of the conference.)
The conference call and live audio webcast, related
presentation materials and other supplemental information will be
accessible in the investors section of Visteon’s website. A news
release on Visteon’s first-quarter results will be available in the
news section of the website.
A replay of the conference call will be available
through the company’s website or by dialing 855-859-2056 (toll-free
from the U.S. and Canada) or 404-537-3406 (international). The
conference ID for the phone replay is 6797470. The phone replay
will be available for one week following the conference call.
Forward-looking Information
This press release contains "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995. The words "will," "may," "designed to,"
"outlook," "believes," "should," "anticipates," "plans," "expects,"
"intends," "estimates," "forecasts" and similar expressions
identify certain of these forward-looking statements.
Forward-looking statements are not guarantees of future results and
conditions but rather are subject to various factors, risks and
uncertainties that could cause our actual results to differ
materially from those expressed in these forward-looking
statements, including, but not limited to: (1) conditions within
the automotive industry, including (i) the automotive vehicle
production volumes and schedules of our customers, (ii) the
financial condition of our customers and the effects of any
restructuring or reorganization plans that may be undertaken by our
customers or suppliers, including work stoppages, and (iii)
possible disruptions in the supply of commodities to us or our
customers due to financial distress, work stoppages, natural
disasters or civil unrest; (2) our ability to satisfy future
capital and liquidity requirements; including our ability to access
the credit and capital markets at the times and in the amounts
needed and on terms acceptable to us; our ability to comply with
financial and other covenants in our credit agreements; and the
continuation of acceptable supplier payment terms; (3) our ability
to satisfy pension and other post-employment benefit obligations;
(4) our ability to access funds generated by foreign subsidiaries
and joint ventures on a timely and cost-effective basis; (5) our
ability to execute on our transformational plans and cost-reduction
initiatives in the amounts and on the timing contemplated; (6)
general economic conditions, including changes in interest rates,
currency exchange rates and fuel prices; (7) the timing and
expenses related to internal restructuring, employee reductions,
acquisitions or dispositions and the effect of pension and other
post-employment benefit obligations; (8) increases in raw material
and energy costs and our ability to offset or recover these costs,
increases in our warranty, product liability and recall costs or
the outcome of legal or regulatory proceedings to which we are or
may become a party; and (9) those factors identified in our filings
with the SEC (including our Annual Report on Form 10-K for the
fiscal year ended Dec. 31, 2018).
Caution should be taken not to place undue reliance
on our forward-looking statements, which represent our view only as
of the date of this release, and which we assume no obligation to
update. The financial results presented herein are preliminary and
unaudited; final financial results will be included in the
company's Quarterly Report on Form 10-Q for the fiscal quarter
ended March 31, 2019. New business wins and rewins do not represent
firm orders or firm commitments from customers, but are based on
various assumptions, including the timing and duration of product
launches, vehicle production levels, customer price reductions and
currency exchange rates.
Use of Non-GAAP Financial Information
This press release contains information about
Visteon's financial results which is not presented in accordance
with accounting principles generally accepted in the United States
("GAAP"). Such non-GAAP financial measures are reconciled to their
closest GAAP financial measures at the end of this press release.
The provision of these comparable GAAP financial measures for 2018
is not intended to indicate that Visteon is explicitly or
implicitly providing projections on those GAAP financial measures,
and actual results for such measures are likely to vary from those
presented. The reconciliations include all information reasonably
available to the company at the date of this press release and the
adjustments that management can reasonably predict.
Follow Visteon:
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VISTEON CORPORATION AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF
OPERATIONS(Dollars in Millions, Except Per Share
Data)(Unaudited)
|
Three Months Ended |
|
March 31 |
|
2019 |
|
2018 |
|
|
|
|
Sales |
$ |
737 |
|
|
$ |
814 |
|
Cost of sales |
(671 |
) |
|
(685 |
) |
Gross margin |
66 |
|
|
129 |
|
Selling, general and
administrative expenses |
(57 |
) |
|
(44 |
) |
Restructuring
expense |
(1 |
) |
|
(5 |
) |
Interest expense,
net |
(2 |
) |
|
(2 |
) |
Equity in net income of
non-consolidated affiliates |
3 |
|
|
3 |
|
Other income, net |
2 |
|
|
7 |
|
Income before income
taxes |
11 |
|
|
88 |
|
Benefit (provision) for
income taxes |
5 |
|
|
(21 |
) |
Net income from
continuing operations |
16 |
|
|
67 |
|
Income from
discontinued operations, net of tax |
— |
|
|
2 |
|
Net income |
16 |
|
|
69 |
|
Net income attributable
to non-controlling interests |
(2 |
) |
|
(4 |
) |
Net income attributable
to Visteon Corporation |
$ |
14 |
|
|
$ |
65 |
|
|
|
|
|
Earnings per share
data: |
|
|
|
Basic earnings per
share |
|
|
|
Continuing
operations |
$ |
0.50 |
|
|
$ |
2.07 |
|
Discontinued operations |
— |
|
|
0.07 |
|
Basic earnings per
share attributable to Visteon Corporation |
$ |
0.50 |
|
|
$ |
2.14 |
|
|
|
|
|
Diluted earnings per
share |
|
|
|
Continuing
operations |
$ |
0.49 |
|
|
$ |
2.05 |
|
Discontinued
operations |
— |
|
|
0.06 |
|
Diluted earnings per
share attributable to Visteon Corporation |
$ |
0.49 |
|
|
$ |
2.11 |
|
|
|
|
|
Average shares
outstanding (in millions) |
|
|
|
Basic |
28.2 |
|
|
30.5 |
|
Diluted |
28.4 |
|
|
30.8 |
|
|
|
|
|
Comprehensive
income: |
|
|
|
Comprehensive
income |
$ |
21 |
|
|
$ |
92 |
|
Comprehensive income
attributable to Visteon Corporation |
$ |
18 |
|
|
$ |
82 |
|
VISTEON CORPORATION AND
SUBSIDIARIESCONSOLIDATED BALANCE
SHEETS(Dollars in Millions)(Unaudited)
|
March 31 |
|
December 31 |
|
2019 |
|
2018 |
ASSETS |
|
|
|
Cash and
equivalents |
$ |
432 |
|
|
$ |
463 |
|
Restricted cash |
3 |
|
|
4 |
|
Accounts receivable,
net |
484 |
|
|
486 |
|
Inventories, net |
195 |
|
|
184 |
|
Other current
assets |
169 |
|
|
159 |
|
Total current
assets |
1,283 |
|
|
1,296 |
|
|
|
|
|
Property and equipment,
net |
406 |
|
|
397 |
|
Intangible assets,
net |
128 |
|
|
129 |
|
Right to use
assets |
167 |
|
|
— |
|
Investments in
non-consolidated affiliates |
45 |
|
|
42 |
|
Other non-current
assets |
153 |
|
|
143 |
|
Total assets |
$ |
2,182 |
|
|
$ |
2,007 |
|
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
Short-term debt,
including current portion of long-term debt |
$ |
56 |
|
|
$ |
57 |
|
Accounts payable |
440 |
|
|
436 |
|
Accrued employee
liabilities |
67 |
|
|
67 |
|
Current lease
liabilities |
28 |
|
|
— |
|
Other current
liabilities |
148 |
|
|
161 |
|
Total current
liabilities |
739 |
|
|
721 |
|
|
|
|
|
Long-term debt |
348 |
|
|
348 |
|
Employee benefits |
255 |
|
|
257 |
|
Non-current lease
liabilities |
142 |
|
|
— |
|
Deferred tax
liabilities |
24 |
|
|
23 |
|
Other non-current
liabilities |
69 |
|
|
76 |
|
|
|
|
|
Stockholders’
equity: |
|
|
|
Common
stock |
1 |
|
|
1 |
|
Additional paid-in capital |
1,332 |
|
|
1,335 |
|
Retained
earnings |
1,623 |
|
|
1,609 |
|
Accumulated other comprehensive loss |
(212 |
) |
|
(216 |
) |
Treasury
stock |
(2,257 |
) |
|
(2,264 |
) |
Total Visteon
Corporation stockholders’ equity |
487 |
|
|
465 |
|
Non-controlling
interests |
118 |
|
|
117 |
|
Total equity |
605 |
|
|
582 |
|
Total liabilities and
equity |
$ |
2,182 |
|
|
$ |
2,007 |
|
VISTEON CORPORATION AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH
FLOWS (Dollars in Millions)(Unaudited)
|
Three Months Ended |
|
March 31 |
|
2019 |
|
2018 |
OPERATING |
|
|
|
Net income |
$ |
16 |
|
|
$ |
69 |
|
Adjustments to
reconcile net income to net cash provided from operating
activities: |
|
|
|
Depreciation and amortization |
25 |
|
|
22 |
|
Equity in
net income of non-consolidated affiliates, net of dividends
remitted |
(3 |
) |
|
(3 |
) |
Non-cash
stock-based compensation |
5 |
|
|
(6 |
) |
Operating
leases, net |
3 |
|
|
— |
|
Gains on
transactions |
— |
|
|
(3 |
) |
Changes in assets and
liabilities: |
|
|
|
Accounts
receivable |
3 |
|
|
48 |
|
Inventories |
(11 |
) |
|
(6 |
) |
Accounts
payable |
9 |
|
|
30 |
|
Other
assets and other liabilities |
(43 |
) |
|
(70 |
) |
Net cash provided from
operating activities |
4 |
|
|
81 |
|
INVESTING |
|
|
|
Capital expenditures,
including intangibles |
(37 |
) |
|
(44 |
) |
Loan repayments from
non-consolidated affiliates |
2 |
|
|
2 |
|
Other |
1 |
|
|
1 |
|
Net cash used by
investing activities |
(34 |
) |
|
(41 |
) |
FINANCING |
|
|
|
Short-term debt,
net |
(2 |
) |
|
(12 |
) |
Distribution
payments |
— |
|
|
(14 |
) |
Repurchase of common
stock |
— |
|
|
(200 |
) |
Other |
— |
|
|
(4 |
) |
Net cash used by
financing activities |
(2 |
) |
|
(230 |
) |
Effect of exchange rate
changes on cash |
— |
|
|
7 |
|
Net decrease in
cash |
(32 |
) |
|
(183 |
) |
Cash and restricted
cash at beginning of the period |
467 |
|
|
709 |
|
Cash and restricted
cash at end of the period |
$ |
435 |
|
|
$ |
526 |
|
The Company has combined cash flows from
discontinued operations and continuing operations within the
operating and investing categories.
VISTEON CORPORATION AND
SUBSIDIARIESRECONCILIATION OF NON-GAAP FINANCIAL
MEASURES(Unaudited, Dollars in Millions)
Adjusted EBITDA: Adjusted EBITDA
is presented as a supplemental measure of the Company's performance
that management believes is useful to investors because the
excluded items may vary significantly in timing or amounts and/or
may obscure trends useful in evaluating and comparing the Company's
operating activities across reporting periods. The Company defines
Adjusted EBITDA as net income attributable to the Company adjusted
to eliminate the impact of depreciation and
amortization, restructuring expense, net interest expense,
loss on divestiture, equity in net income of non-consolidated
affiliates, gain on non-consolidated affiliate transactions,
provision for income taxes, discontinued operations, net
income attributable to non-controlling interests, non-cash
stock-based compensation expense, and other gains and losses not
reflective of the Company's ongoing operations. Because not all
companies use identical calculations, this presentation of Adjusted
EBITDA may not be comparable to similarly titled measures of other
companies.
|
Three Months Ended |
|
Estimated |
|
March 31 |
|
Full Year |
Visteon: |
2019 |
|
2018 |
|
2019 |
Net income attributable
to Visteon Corporation |
$ |
14 |
|
|
$ |
65 |
|
|
$59 - $79 |
Depreciation and
amortization |
25 |
|
|
22 |
|
|
97 |
Restructuring
expense |
1 |
|
|
5 |
|
|
25 |
Interest
expense, net |
2 |
|
|
2 |
|
|
9 |
Equity in net
income of non-consolidated affiliates |
(3 |
) |
|
(3 |
) |
|
(12) |
(Benefit)
provision for income taxes |
(5 |
) |
|
21 |
|
|
35 -
40 |
Income from
discontinued operations, net of tax |
— |
|
|
(2 |
) |
|
— |
Net income
attributable to non-controlling interests |
2 |
|
|
4 |
|
|
12 |
Non-cash,
stock-based compensation expense |
5 |
|
|
(6 |
) |
|
20 |
Other |
— |
|
|
(4 |
) |
|
— |
Adjusted EBITDA |
$ |
41 |
|
|
$ |
104 |
|
|
$245 - $270 |
Adjusted EBITDA is not a recognized term under U.S.
GAAP and does not purport to be a substitute for net income as an
indicator of operating performance or cash flows from operating
activities as a measure of liquidity. Adjusted EBITDA has
limitations as an analytical tool and is not intended to be a
measure of cash flow available for management's discretionary use,
as it does not consider certain cash requirements such as interest
payments, tax payments and debt service requirements. In addition,
the Company uses Adjusted EBITDA (i) as a factor in incentive
compensation decisions, (ii) to evaluate the effectiveness of the
Company's business strategies, and (iii) because the Company's
credit agreements use similar measures for compliance with certain
covenants.
Free Cash Flow and Adjusted Free Cash
Flow: Free cash flow and Adjusted free cash flow are
presented as supplemental measures of the Company's liquidity that
management believes are useful to investors in analyzing the
Company's ability to service and repay its debt. The Company
defines Free cash flow as cash flow provided from operating
activities less capital expenditures, including intangibles.
The Company defines Adjusted free cash flow as cash flow provided
from operating activities less capital expenditures, including
intangibles as further adjusted for restructuring related payments.
Free cash flow and Adjusted free cash flow include amounts
associated with discontinued operations. Because not all companies
use identical calculations, this presentation of Free cash flow and
Adjusted free cash flow may not be comparable to other similarly
titled measures of other companies.
|
Three Months Ended |
|
Estimated |
|
March 31 |
|
Full Year |
Total
Visteon: |
2019 |
|
2018 |
|
2019 |
Cash provided from
operating activities |
$ |
4 |
|
|
$ |
81 |
|
|
$165 - $180 |
Capital expenditures,
including intangibles |
(37 |
) |
|
(44 |
) |
|
(145 - 135) |
Free cash flow |
$ |
(33 |
) |
|
$ |
37 |
|
|
$25 -
$45 |
Restructuring related
payments |
3 |
|
|
11 |
|
|
25 - 25 |
Adjusted free cash
flow |
$ |
(30 |
) |
|
$ |
48 |
|
|
$45 - $70 |
Free cash flow and Adjusted free cash flow are not
recognized terms under U.S. GAAP and do not purport to be a
substitute for cash flows from operating activities as a measure of
liquidity. Free cash flow and Adjusted free cash flow have
limitations as analytical tools as they do not reflect cash used to
service debt and do not reflect funds available for investment or
other discretionary uses. In addition, the Company uses Free cash
flow and Adjusted free cash flow (i) as factors in incentive
compensation decisions and (ii) for planning and forecasting future
periods.
Adjusted Net Income and Adjusted Earnings
Per Share: Adjusted net income and Adjusted earnings per
share are presented as supplemental measures that management
believes are useful to investors in analyzing the Company's
profitability, providing comparability between periods by excluding
certain items that may not be indicative of recurring business
operating results. The Company believes management and investors
benefit from referring to these supplemental measures in assessing
company performance and when planning, forecasting and analyzing
future periods. The Company defines Adjusted net income as net
income attributable to Visteon adjusted to eliminate the impact of
restructuring expense, loss on divestiture, gain on
non-consolidated affiliate transactions, other net expenses,
discontinued operations, other gains and losses not reflective of
the Company's ongoing operations and related tax effects. The
Company defines Adjusted earnings per share as Adjusted net income
divided by diluted shares. Because not all companies use identical
calculations, this presentation of Adjusted net income and Adjusted
earnings per share may not be comparable to other similarly titled
measures of other companies.
|
Three Months Ended March 31 |
Net income
attributable to Visteon: |
2019 |
|
2018 |
Net income |
$ |
14 |
|
|
$ |
63 |
|
Discontinued
operations |
— |
|
|
2 |
|
Net income attributable
to Visteon |
$ |
14 |
|
|
$ |
65 |
|
|
Three Months Ended March 31 |
|
2019 |
|
2018 |
Diluted
earnings per share: |
|
|
|
Net income attributable
to Visteon |
$ |
14 |
|
|
$ |
65 |
|
Average shares
outstanding, diluted (in millions) |
28.4 |
|
|
30.8 |
|
Diluted earnings per
share |
$ |
0.49 |
|
|
$ |
2.11 |
|
|
|
|
|
Adjusted
earnings per share: |
|
|
|
Net income attributable
to Visteon |
$ |
14 |
|
|
$ |
65 |
|
Restructuring, net |
1 |
|
|
5 |
|
Other |
— |
|
|
(4 |
) |
Income from
discontinued operations, net of tax |
— |
|
|
(2 |
) |
Adjusted net
income |
$ |
15 |
|
|
$ |
64 |
|
Average shares
outstanding, diluted (in millions) |
28.4 |
|
|
30.8 |
|
Adjusted earnings per
share |
$ |
0.53 |
|
|
$ |
2.08 |
|
|
|
Adjusted net income and Adjusted earnings per share
are not recognized terms under U.S. GAAP and do not purport to be a
substitute for profitability. Adjusted net income and Adjusted
earnings per share have limitations as analytical tools as they do
not consider certain restructuring and transaction-related payments
and/or expenses. In addition, the Company uses Adjusted net income
and Adjusted earnings per share for internal planning and
forecasting purposes.
Contacts:
Media:
Jim Fisher734-710-5557734-417-6184 –
mobilejfishe89@visteon.com
Investors:
Kris Doyle734-710-7893kdoyle@visteon.com
Visteon (NASDAQ:VC)
Historical Stock Chart
From Jun 2024 to Jul 2024
Visteon (NASDAQ:VC)
Historical Stock Chart
From Jul 2023 to Jul 2024