Magna International Inc. (TSX: MG; NYSE: MGA) today announced its financial outlook for 2017, along with sales expectations for 2019. In this outlook we have assumed no material unannounced 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 year end 2016 rates.
Outlook
| 2017 | 2019 | |||
| Light Vehicle Production (Units) | ||||
| North America | 17.7 million | 18.4 million | ||
| Europe | 21.7 million | 22.5 million | ||
| Production Sales | ||||
| North America | $19.2 – $19.8 billion | $20.4 – $21.2 billion | ||
| Europe | $8.7 – $9.1 billion | $10.1 – $10.7 billion | ||
| Asia | $2.2 – $2.4 billion | $3.2 – $3.5 billion | ||
| Rest of World | $0.3 – $0.4 billion | $0.4 – $0.6 billion | ||
| Total Production Sales | $30.4 – $31.7 billion | $34.1 – $36.0 billion | ||
| Complete Vehicle Assembly Sales | $2.7 – $3.0 billion | $6.6 – $7.1 billion | ||
| Total Sales | $36.0 – $37.7 billion | $43.5 – $46.2 billion | ||
| EBIT Margin(1) | Approximately 8% | |||
| Interest Expense | Approximately $90 million | |||
| Tax Rate | 25% – 26% | |||
| Capital Spending | Approximately $2 billion | |||
“Magna has a long history of above-market sales growth, and 2016 was no exception. As we look forward over the next three years, we expect our sales to continue to outpace industry production.
Longer term, we believe our capabilities and new innovations, together with our deep customer relationships, will position us for continued growth as a preferred supplier for the ‘Car of the Future’.”
– Don Walker, Magna’s Chief Executive Officer
“We have made good progress in improving our margins over the last number of years. We believe there is potential for further margin progress by 2019, across each of our reporting segments. We expect to translate our sales growth, margins and solid returns into strong free cash flow generation over the next three years.”
– Vince Galifi, Magna’s Chief Financial Officer
We will be making a presentation at the Deutsche Bank Global Auto Industry Conference on Wednesday, January 11, 2017 at 1:20 p.m. EST during which we will review the details of our Outlook. The presentation will be webcast and available on our website at www.magna.com. The slides accompanying the presentation will be available on our website Wednesday morning by 7:00 a.m. EST
