Magna International Inc. (TSX: MG; NYSE: MGA) today reported financial results for the fourth quarter and year ended December 31, 2013.
THREE MONTHS ENDED DECEMBER 31, 2013
We posted sales of $9.17 billion for the fourth quarter ended December 31, 2013, an increase of 14% over the fourth quarter of 2012. We achieved this sales increase in a period when vehicle production increased 6% in North America and 5% in Europe, both relative to the fourth quarter of 2012. In the fourth quarter of 2013, our North American, European, and Asian production sales, as well as tooling, engineering and other sales and complete vehicle assembly sales all increased while our Rest of World production sales declined relative to the comparable quarter in 2012.
Complete vehicle assembly sales increased 13% to $788 million for the fourth quarter of 2013 compared to $697 million for the fourth quarter of 2012, while complete vehicle assembly volumes increased 17% to approximately 37,000 units.
For the fourth quarter of 2013, adjusted EBIT increased 57% to $607 million compared to $387 million for the fourth quarter of 2012.
For the fourth quarter of 2013, income from operations before income taxes was $514 million, net income attributable to Magna International Inc. was $458 million and diluted earnings per share were $2.03, increases of $173 million, $107 million and $0.54, respectively, each compared to the fourth quarter of 2012.
Excluding other expense (income), net after tax and net loss attributable to non-controlling interests, the income tax valuation allowance releases and the impact of the elimination of the Mexican flat tax recorded in the fourth quarters of 2013 and 2012, income from operations before income taxes, net income attributable to Magna International Inc. and diluted earnings per share increased $218 million, $166 million and $0.79, respectively, each compared to the fourth quarter of 2012.
For the fourth quarter ended December 31, 2013, we generated cash from operations of $809 million before changes in non-cash operating assets and liabilities, and $451 million in non-cash operating assets and liabilities. Total investment activities for the fourth quarter of 2013 were $506 million, including $463 million in fixed asset additions, $34 million in investments and other assets and $9 million to purchase subsidiaries.
YEAR ENDED DECEMBER 31, 2013
We posted sales of $34.84 billion for the year ended December 31, 2013, an increase of 13% over the year ended December 31, 2012. This higher sales level reflected increases in our North American, European, Asian and Rest of World production sales as well as higher tooling, engineering and other sales, and complete vehicle assembly sales.
For the year ended December 31, 2013, vehicle production increased 5% to 16.2 million units in North America and decreased 1% to 19.3 million units in Europe, each compared to 2012.
Complete vehicle assembly sales increased 20% to $3.06 billion for the year ended December 31, 2013 compared to $2.56 billion for the year ended December 31, 2012, while complete vehicle assembly volumes increased 19% to approximately 147,000 units.
For the year ended December 31, 2013, adjusted EBIT increased 25% to $2.07 billion compared to $1.66 billion for the year ended December 31, 2012.
For the year ended December 31, 2013, income from operations before income taxes was $1.91 billion, net income attributable to Magna International Inc. was $1.56 billion and diluted earnings per share were $6.76, increases of $155 million, $128 million and $0.67, respectively, each compared to 2012.
Excluding other expense (income), net after tax and net loss attributable to non-controlling interests, the income tax valuation allowance releases and the impact of the elimination of the Mexican flat tax recorded in 2013 and 2012, income from operations before income taxes, net income attributable to Magna International Inc. and diluted earnings per share increased $407 million, $351 million and $1.62, respectively, each compared to 2012.
For the year ended December 31, 2013, we generated cash from operations before changes in non-cash operating assets and liabilities of $2.69 billion, and invested $127 million in non-cash operating assets and liabilities. Total investment activities for the year of 2013 were $1.37 billion, including $1.17 billion in fixed asset additions, a $192 million increase in investments and other assets and $9 million to purchase subsidiaries.
Don Walker, Magna’s Chief Executive Officer commented: “2013 was another strong year for Magna. We maintained our solid performance in North America, and made further progress in improving profitability in Europe. Recent investments in Asia have begun to yield returns, even while we continue to invest in the region. Lastly, our business in South America, while still challenging, is poised to generate some improvement going forward.”
A more detailed discussion of our consolidated financial results for the fourth quarter and year ended December 31, 2013 is contained in the Management’s Discussion and Analysis of Results of Operations and Financial Position and the unaudited interim consolidated financial statements and notes thereto, which are attached to this Press Release.
DIVIDENDS
Friday, our Board of Directors declared a quarterly dividend of $0.38 per share with respect to our outstanding Common Shares for the quarter ended December 31, 2013. This dividend is payable on March 28, 2014 to shareholders of record on March 14, 2014.
Vince Galifi, Magna’s Chief Financial Officer, stated: “Our quarterly dividend per share of $0.38, an increase of 19%, is a new record for us. In addition, we recently stated our intention to accelerate the utilization of our balance sheet to further invest in our business and return capital to shareholders over the next two years. These actions reflect our ongoing strong results and the confidence our Board has in Magna’s future.”
UPDATED 2014 OUTLOOK
In this 2014 outlook, in addition to 2014 light vehicle production, we have assumed no material acquisitions or divestitures. In addition, we have assumed that foreign exchange rates for the most common currencies in which we conduct business relative to our U.S. dollar reporting currency will approximate current rates.
