Printer Friendly

MAGNA ANNOUNCES 1996 SECOND QUARTER RESULTS AND OTHER DEVELOPMENTS

TORONTO, March 8 /PRNewswire/ -- Magna International Inc. (TSE: MG.A, MG.B; ME: MG.A; NYSE: MGA) today reported sales, profits and earnings per share for the second quarter ended January 31, 1996.
 Six Months Ended Three Months Ended
 January 31 January 31
 1996 1995 1996 1995
 Sales $2608.2 $2300.8 $1313.5 $1167.4
 Income before income
 taxes and minority
 interest $ 210.0 $ 241.9 $ 98.0 $ 114.5
 Net income $ 135.3 $ 154.2 $ 63.4 $ 73.4
 Fully diluted
 earnings per share $ 2.13 $ 2.50 $ 0.98 $ 1.20


All results are reported in millions of Canadian dollars, except per share figures.

Sales for the second quarter and first half of fiscal 1996 were $1.31 billion and $2.61 billion respectively, an increase of 13% over each of the comparable periods of the prior year. The higher sales levels reflect a 10% increase in North American content per vehicle over the first six months of fiscal 1996, higher tooling sales and a 7% increase relating to European production sales, offset partially by a 5% decline in North American vehicle production.

Gross margin, as a percentage of production sales, for the second quarter and first half were 20.0% and 20.3% respectively compared to 22.6% for each of the comparable periods in fiscal 1995. This decline resulted from lower North American vehicle volumes, costs relating to major new program launches, and from lower margins in our European operations.

Net income for the first six months was $135.3 million compared to $154.2 million in the comparable period in 1995. This reflects higher sales and an increase in equity income, offset by a lower gross margin and by increases in variable and European SG&A costs, interest costs and depreciation and amortization expense.

Fully diluted earnings per share for the second quarter and first six months of fiscal 1996 were $0.98 and $2.13 respectively compared to $1.20 and $2.50 per share for the same periods in the prior year.

During the first half of fiscal 1996, cash generated from operations was $234 million. Net investment activities were $189 million, including investments of $166 million in fixed assets.

The Board of Directors declared a dividend of $0.27 per share with respect to the Class A Subordinate Voting Shares and Class B Shares for the quarter ended January 31, 1996 payable on April 15, 1996 to shareholders of record on March 29, 1996.

European production sales for the first half of fiscal 1996 were approximately $510 million and as expected the profitability of these operations is increasing. Although we anticipate continued margin pressure from European operations for the medium term, our operations are showing improvement. We anticipate that the strength of the Company's European technological capabilities will enhance our global industry competitiveness in the future.

The Company also announced that its European metallic body and chassis systems operation has been awarded the space frame production contract for the Smart vehicle, a new European micro compact car. Smart is a joint venture between Daimler Benz (51%) and the Swiss watch company SMH (49%), the producer of the world famous Swatch watch. Magna Europe was instrumental in the development of the space frame for the vehicle. The six-year production contract, which is scheduled to commence production in 1998, will have annual sales of approximately $200 million. This award represents another significant step in Magna's strategic plan to expand its technical capability, and in particular its metal forming operations in Europe, and strengthen its position in the global automotive market.

In an increasingly global automotive industry, in which OEM emphasis is on greater outsourcing of more complex systems, to more technologically advanced suppliers, Magna is continuing to build stronger relationships with both North American and new domestic car companies. The Company has also focused considerable attention and resources on the growth of product technologies, customers and sales in Europe over the past several years.

We are confident that our continuous focus on excellence in innovative technologies, global engineering and program management, and financial strength will enhance our worldwide competitiveness in an increasingly global automotive marketplace.

Magna, one of the most diversified automotive suppliers in the world, designs, develops and manufactures automotive systems, assemblies and components primarily for sale to original equipment manufacturers of cars and light trucks in North America, Mexico and Europe. Magna's products include exterior decorative systems, interior products including seating systems, door and other panels, airbags and steering wheels, stamped and welded metal parts and assemblies, sunroofs, electro-mechanical devices and assemblies, various engine, powertrain and fueling and cooling components, and a variety of plastic parts, including body panels and fascias.

Magna has over 22,000 employees in 88 manufacturing operations in 10 countries.
 MAGNA INTERNATIONAL INC. SIX MONTHS ENDED THREE MONTHS ENDED
 CONSOLIDATED STATEMENTS
 OF INCOME AND RETAINED JANUARY 31 JANUARY 31
 EARNINGS 1996 1995 1996 1995
 (Canadian dollars in
 millions, except per (Restated) (Restated)
 share figures)
 (Unaudited)
 Sales $2,608.2 $2,300.8 $1,313.5 $1,167.4
 Cost of goods sold 2,135.8 1,826.5 1,082.0 931.7
 Depreciation and
 amortization 92.8 81.2 46.4 41.8
 Selling, general and
 administrative 175.0 152.5 88.0 80.2
 Interest 3.5 2.0 2.7 0.7
 Equity income (8.9) (3.3) (3.6) (1.5)
 Income before income
 taxes and minority
 interest 210.0 241.9 98.0 114.5
 Income taxes 67.4 81.9 31.6 38.0
 Minority interest 7.3 5.8 3.0 3.1
 Net income 135.3 154.2 63.4 73.4
 Retained earnings,
 beginning of period 557.5 325.2 612.8 389.8
 Dividends on Class A
 Subordinate Voting Shares
 and Class B Shares (32.8) (32.1) (16.2) (15.9)
 Surrender of stock options -- (19.5) -- (19.5)
 Retained earnings, end
 of period $ 660.0 $ 427.8 $ 660.0 $ 427.8
 Earnings per Class A
 Subordinate Voting Share
 or Class B Share:
 Basic $ 2.20 $ 2.53 $ 1.03 $ 1.20
 Fully diluted $ 2.13 $ 2.50 $ 0.98 $ 1.20
 Cash dividends paid per
 Class A Subordinate Voting
 Share or Class B Share $ 0.54 $ 0.54 $ 0.27 $ 0.27
 MAGNA INTERNATIONAL INC. SIX MONTHS ENDED THREE MONTHS ENDED
 CONSOLIDATED STATEMENTS
 OF CASH FLOWS JANUARY JANUARY
 (Canadian dollars in 1996 1995 1996 1995
 millions)
 (Unaudited) (Restated) (Restated)
 Cash provided from
 (used for):
 OPERATING ACTIVITIES -
 Net income $135.3 $154.2 $ 63.4 $ 73.4
 Items not involving
 current cash flows 99.2 79.2 48.7 42.9
 234.5 233.4 112.1 116.3
 Changes in non-cash
 working capital (268.5) (127.9) 6.7 (71.5)
 (34.0) 105.5 118.8 44.8
 INVESTMENT ACTIVITIES -
 Fixed asset additions (165.8) (137.7) (106.7) (63.5)
 Increase in investments
 and other (22.9) (52.5) (12.1) (40.5)
 Purchase of subsidiaries (3.4) (49.5) (3.4) (14.0)
 Proceeds from disposition
 of fixed assets and other 3.2 65.3 2.3 22.1
 Cash acquired on acquisition
 of subsidiary -- 17.1 -- 17.1
 (188.9) (157.3) (119.9) (78.8)
 FINANCING ACTIVITIES -
 Net (repayment) issue
 of debt (21.8) (15.5) (22.7) 14.8
 Issue of convertible
 subordinated debentures 454.1 -- -- --
 Issue of Class A Subordinate
 Voting Shares 0.1 5.8 0.1 4.1
 Surrender of stock options -- (19.5) -- (19.5)
 Dividends paid to (net of
 capital contributions by)
 minority interests (0.8) (2.0) (0.7) (1.5)
 Dividends (32.8) (32.1) (16.2) (15.9)
 398.8 (63.3) (39.5) (18.0)
 Net increase (decrease)
 in cash 175.9 (115.1) (40.6) (52.0)
 Cash, beginning of period 413.9 228.6 630.4 165.5
 Cash, end of period $589.8 $113.5 $589.8 $113.5
 MAGNA INTERNATIONAL INC.
 CONSOLIDATED BALANCE SHEETS
 (Canadian dollars in millions)
 (Unaudited)
 JANUARY 31 JULY 31
 1996 1995
 (Restated)
 ASSETS
 Current assets:
 Cash $ 589.8 $ 413.9
 Accounts receivable 830.3 668.4
 Inventories 447.3 446.9
 Prepaid expenses 26.8 32.1
 1,894.2 1,561.3
 Investments 80.2 75.4
 Fixed assets (net) 1,347.5 1,304.7
 Goodwill 84.2 89.8
 Other assets 92.3 78.6
 TOTAL ASSETS $3,498.4 $3,109.8
 LIABILITIES AND SHAREHOLDERS' EQUITY
 Current liabilities:
 Bank indebtedness $ 56.7 $ 27.4
 Accounts payable and other accruals 793.1 918.1
 Long-term debt due within one year 30.1 64.6
 879.9 1,010.1
 Long-term debt 67.3 94.7
 Convertible subordinated debentures 612.0 150.0
 Deferred income taxes 114.4 112.0
 Minority interest 147.9 151.4
 Shareholders' equity:
 Capital stock issued and outstanding -
 Class A Subordinate Voting Shares 955.2 955.1
 Class B Shares 1.3 1.3
 Retained earnings 660.0 557.5
 Currency translation adjustment 60.4 77.7
 1,676.9 1,591.6
 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $3,498.4 $3,109.8
 -0- 3/8/96


/CONTACT: Graham Orr, Executive Vice-President of Corporate Development of Magna International Inc., 905-477-7766/

(MG.A. MG.B. MGA)

CO: Magna International Inc. ST: Ontario IN: AUT SU: ERN DIV

SR -- NYF061 -- 1793 03/08/96 18:52 EST
COPYRIGHT 1996 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1996 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Mar 8, 1996
Words:1561
Previous Article:JAYHAWK ACCEPTANCE CORPORATION FILES REGISTRATION STATEMENT COVERING PREVIOUSLY ANNOUNCE 2,500,000 SHARE OFFERING
Next Article:RECORD $100 MILLION SETTLEMENT WINS COURT APPROVAL
Topics:

Terms of use | Copyright © 2018 Farlex, Inc. | Feedback | For webmasters