Superior Industries Reports Financial Results for 2012 Second Quarter

VAN NUYS, Calif.--()--Superior Industries International, Inc. (NYSE:SUP) today reported net income of $6.4 million, or $0.23 per diluted share for the second quarter of 2012. This compares with net income of $14.7 million, or $0.53 per diluted share, for the second quarter of 2011.

For the 2012 second quarter, consolidated net sales increased 3 percent, to $215.1 million from $208.7 million in the comparable period a year ago. Unit shipments increased 14 percent to 3.3 million from 2.9 million in last year’s second quarter. Gross profit was $15.7 million, or 7 percent of net sales, compared with $19.5 million, or 9 percent of net sales, in the comparable period a year ago.

The company said the average unit selling price decreased 10 percent in the second quarter of 2012, largely attributable to a decline in average aluminum price, which is generally passed through to customers, along with a weaker product mix and a decline in the value of the Mexican peso relative to the U.S. dollar. The decline in gross profit and margin percentage reflected the weaker product mix, along with manufacturing challenges in the U.S. and the negative impact from foreign currency rates. All manufacturing facilities operated at or near full capacity to meet the increase in unit volume. Higher operating costs in the U.S. offset a strong performance at the company’s facilities in Mexico.

“I am pleased that our factories, especially our plants in Mexico, met a significant increase in demand for our product despite already operating at very high utilization rates,” said Steven J. Borick, Chairman, Chief Executive Officer and President. “However, when considering the ever-increasing product standards that we must meet in the context of today’s pricing, we still are incurring significant operating and profitability challenges in our U.S. manufacturing facilities. We continue to invest in capital equipment and talent to address these challenges and remain confident we can improve the performance of our U.S. plants that today remain critical to meeting the needs of our customers.”

Selling, general and administrative expenses for the 2012 second quarter were $7.5 million, or 3 percent of net sales, which compares to $6.4 million, or 3 percent of net sales, for the comparable period in 2011.

Consolidated income from operations decreased $4.7 million in the 2012 second quarter to $8.2 million, or 4 percent of net sales, from $12.9 million, or 6 percent of net sales, in the comparable period last year.

Income taxes for the second quarter were expense of $2.0 million, or 24 percent of pretax income, compared to a $1.1 million net benefit, or 8 percent of pretax income for the same period in 2011. The prior year benefit reflected an update in estimate for foreign taxes based on information received during the quarter.

At June 30, 2012, working capital was $344.6 million, including cash, cash equivalents and short-term investments of $212.3 million. At December 31, 2011, working capital was $335.7 million, including cash, cash equivalents and short-term investments of $192.9 million. Superior has no bank or other interest bearing debt.

First Half Results

Consolidated net sales for the first half of 2012 increased 5 percent to $417.5 million, from $398.3 million for the comparable period a year ago. Unit shipments for the first six months of 2012 increased 13 percent. The average selling price of wheels during the first half of 2012 decreased approximately 7 percent, primarily due to a decrease in the pass-through price of aluminum, as well as a weaker product mix and Mexican peso.

Consolidated gross profit for the first half of 2012 decreased to $32.8 million, or 8 percent of net sales, compared with $36.4 million, or 9 percent of net sales, for the comparable period a year ago. The decrease resulted from higher volume and continued plant operation at full capacity, as well as an unfavorable change in product mix. Certain factory costs, including repairs, maintenance, supplies, labor and fringe benefit costs were higher in first half of 2012 than in the prior year.

Selling, general and administrative expenses were $14.4 million, or 3 percent of net sales for the first half of 2012, compared with $13.0 million, or 3 percent of net sales, for the comparable period in 2011.

Consolidated income from operations was $18.4 million, or 4 percent of net sales for the first half of 2012, versus $23.0 million, or 6 percent of net sales, in 2011.

The year-to-date 2012 income tax provision was $6.2 million compared to $2.1 million expense for the first half of 2011. The lower income tax rate in the prior year largely reflects the impact of the second quarter net tax benefit noted previously.

Conference Call

Superior will host a conference call beginning at 10 a.m. PT (1 p.m. ET) on Friday, August 3, 2012 that will be broadcast on the company's website, www.supind.com. Interested parties are invited to listen to the webcast. In addition, a PowerPoint presentation will be posted on the company's website and referred to during the conference call. The webcast replay will be available at the same Internet address approximately one hour after the conclusion of the conference call and will be archived for approximately one year.

During the conference call, the company's management plans to review operating results and discuss other financial and operating matters. In addition, management may disclose material information in response to questions posed by participants during the call.

About Superior Industries

Superior is the largest manufacturer of aluminum wheels for passenger cars and light-duty vehicles in North America. From its five plants in both the U.S. and Mexico, the company supplies aluminum wheels to the original equipment market. Major customers include Ford, General Motors, Chrysler, BMW, Mitsubishi, Nissan, Subaru, Toyota and Volkswagen. For more information, visit www.supind.com.

Forward-Looking Statements

This press release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements, which include, but are not limited to, improving performance in U.S. plants, are based on current expectations, estimates and projections about the company's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors and risks discussed from time to time in the company's Securities and Exchange Commission filings and reports, including the company's Annual Report on Form 10-K for 2011. These factors and risks relate to items including, but not limited to, general automotive industry and market conditions and growth rates, as well as general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made and the company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.

SUPERIOR INDUSTRIES INTERNATIONAL, INC.

Condensed Consolidated Income Statements (Unaudited)

(Dollars in Thousands, Except Per Share Amounts)
                                           
 
Three Months Ended Six Months Ended
                    June 30           June 30
                      2012             2011             2012             2011  
Net Sales $ 215,053 $ 208,734 $ 417,510 $ 398,268
 
Cost of Sales             199,337             189,187             384,686             361,844  
Gross Profit 15,716 19,547 32,824 36,424
 
Selling and Administrative Expenses 7,490 6,354 14,375 13,046
Impairment of Long-Live Assets and Other Charges             -             340             -             340  
Income From Operations 8,226 12,853 18,449 23,038
 
Interest Income, net 216 358 516 649
Other Income (Expense), net             (4 )           434             337             1,125  
Income Before Income Taxes
and Equity Earnings 8,438 13,645 19,302 24,812
 
Income Tax (Provision) Benefit (2,024 ) 1,055 (6,155 ) (2,058 )
Equity Losses of Unconsolidated Affiliates             -             -             -             -  
Net Income           $ 6,414           $ 14,700           $ 13,147           $ 22,754  
 
 
Income Per Share:
Basic $ 0.24 $ 0.54 $ 0.48 $ 0.84
Diluted $ 0.23 $ 0.53 $ 0.48 $ 0.83
 
Weighted Average and Equivalent Shares
Outstanding for Income Per Share:
Basic 27,209,000 27,045,000 27,190,000 26,955,000
Diluted             27,307,000             27,561,000             27,313,000             27,440,000  
 
 
 
SUPERIOR INDUSTRIES INTERNATIONAL, INC.

Condensed Consolidated Balance Sheets (Unaudited)

(Dollars in Thousands)
 
June 30, December 31,
  2012             2011  
Current Assets $ 426,798 $ 404,283
Property, Plant and Equipment, net 142,237 145,747
Investments and Other Assets   38,822             43,201  
$ 607,857           $ 593,231  
 
Current Liabilities $ 82,155 $ 68,550
Long-Term Liabilities 60,352 64,166
Shareholders' Equity   465,350             460,515  
$ 607,857           $ 593,231  
 

Contacts

Superior Industries
Investor Relations Line:
818-902-2701
www.supind.com
or
Kerry Shiba
818-781-4973
or
PondelWilkinson Inc.
Robert Jaffe / Roger Pondel
310-279-5980
Investor@pondel.com

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Contacts

Superior Industries
Investor Relations Line:
818-902-2701
www.supind.com
or
Kerry Shiba
818-781-4973
or
PondelWilkinson Inc.
Robert Jaffe / Roger Pondel
310-279-5980
Investor@pondel.com