ZEELAND, MI--(Marketwire - July 22, 2008) - Gentex Corporation (
NASDAQ:
GNTX), the Zeeland,
Michigan-based manufacturer of automatic-dimming rearview mirrors and
commercial fire protection products, today reported record second quarter
revenues for the quarter ended June 30, 2008. The Company also announced
that it repurchased approximately 1.2 million shares of its stock during
the second quarter of 2008.
For the second quarter of 2008, the Company's net sales increased by four
percent to a record $170.5 million compared with $163.5 million in the
second quarter of 2007. The Company's current second quarter operating
income declined by two percent, and net income declined by 13 percent,
primarily as a result of lower other income due to current stock market
conditions. The Company reported net income of $26.9 million compared with
$31.0 million for the second quarters of 2008 and 2007, respectively.
Earnings per diluted share were 19 cents in the second quarter of 2008
compared with 22 cents in the second quarter of 2007.
For the first six months of 2008, net sales increased by nine percent to
$348.5 million compared with $320.7 million in the first six months of
2007. Operating income increased by eight percent for the first six months
of 2008 compared with the same period in 2007, while net income decreased
by five percent for the first six months of 2008 compared with the same
prior-year period. Net income for the first six months of 2008 was $57.3
million compared with $60.5 million for the first six months of 2007,
primarily as a result of lower other income due to current stock market
conditions. Earnings per diluted share were 40 cents for the first six
months of 2008 compared with 42 cents for the first six months of 2007.
During the second quarter, the Company repurchased 1.2 million shares at a
cost of approximately $19.0 million. The Company has a share repurchase
plan in place with authorization to repurchase up to 28 million shares of
the Company's stock. To date, including the prior share repurchases, the
Company has repurchased approximately 21.4 million shares, leaving
approximately 6.6 million shares authorized to be repurchased under the
plan.
"The second quarter of 2008 is a testament to the Company's success at
global sales diversification," said Gentex Chairman and Chief Executive
Officer Fred Bauer. "We are operating in an industry that is experiencing
the most significant production declines, particularly at the 'Detroit
Three', since 1991, but our sales still increased by four percent in the
second quarter. This is due to the fact that nearly 75 percent of the
Company's mirror unit shipments are now to automakers headquartered outside
North America.
"While our company goal is to achieve double-digit top line growth, and we
look forward to seeing improved economic conditions, we will continue to
work to control the things that we can and do our very best for the
Company's shareholders," Bauer continued. "We have some popular new
products with significant revenue growth potential over the next several
years, such as auto-dimming mirrors with SmartBeam® and rear camera
displays, which are helping Gentex to continue to be the industry leader in
these areas. We remain excited about our company and the prospects for the
future."
Total auto-dimming mirror unit shipments for the second quarter of 2008
increased by one percent over the second quarter of 2007, and automotive
revenues increased by five percent. The primary reasons for the lower
growth rate were the UAW strikes that started in the first quarter of 2008
and continued into the second quarter, reducing the Company's automotive
revenues by approximately $5.8 million, and lower light vehicle production
at the Detroit Three. For the current quarter, unit shipments in North
America decreased by 13 percent compared with the second quarter of 2007,
primarily as a result of lower light vehicle production at the Detroit
Three and the continuation of the UAW strikes. Increased unit shipments to
Asian and European transplants partially offset those two negative factors.
Increased penetration of interior and exterior auto-dimming mirrors at
certain of the Company's European and Asian automotive customers was the
primary factor in achieving a 12 percent increase in offshore auto-dimming
mirror unit shipments.
Future Estimates
Gentex Senior Vice President Enoch Jen said that the Company continues to
make good progress in its manufacturing yields, and provided certain
guidance for the third quarter and balance of calendar year 2008.
"For the third quarter and balance of calendar year 2008, we currently
expect that our top line will grow by approximately ten percent," said Jen.
"However, while the third quarter is always a difficult quarter for us to
forecast due to customer plant summer shutdowns and model year product
changeover, this year has far more uncertainties associated with it due to
the global economic conditions and light vehicle production environment,"
Jen concluded.
Unit Shipments and Revenues
Jen said that the Company's current third quarter 2008 forecast is based on
CSM's mid-July forecast for light vehicle production of 3.1 million units
for North America, 4.9 million units for Europe and 3.6 million units for
Japan and Korea. The Company's current calendar year 2008 forecast is
based on CSM's 2008 calendar year projection of 13.4 million units for
North America, 22.0 million units for Europe and 15.0 million units for
Japan and Korea.
Total auto-dimming mirror unit shipments in the second quarter of 2008 were
approximately 3.9 million, a one percent increase over the same period last
year. Auto-dimming mirror unit shipments increased by six percent to 8.1
million for the first six months of 2008, compared with the same prior-year
period.
Auto-dimming mirror unit shipments to customers in North America decreased
by 13 percent to approximately 1.5 million in the second quarter of 2008
compared with the same quarter last year. North American light vehicle
production was down 14 percent in the second quarter of 2008 compared with
the same period in 2007. For the first six months of 2008, auto-dimming
mirror unit shipments to customers in North America decreased by six
percent to approximately 3.1 million compared with the same period last
year. North American light vehicle production declined by 11 percent for
the first six months of 2008 compared with the same period in 2007.
Unit shipments to offshore customers increased by 12 percent to
approximately 2.4 million in the second quarter of 2008 compared with the
same period in 2007. Light vehicle production in Europe increased by four
percent, and production in Japan and Korea increased by two percent in the
second quarter of 2008 compared with the same prior-year periods. For the
first six months of 2008, auto-dimming mirror unit shipments to offshore
customers increased by 14 percent to approximately 4.9 million compared
with the same period last year. Production in Europe increased by three
percent and by four percent in Japan and Korea for the first six months of
2008 compared with the same period in 2007.
Automotive revenues increased by five percent to $164.8 million in the
second quarter of 2008 compared with the same period last year, and
increased by nine percent to $336.9 million for the first six months of
2008. Fire Protection revenues decreased by ten percent to $5.6 million
for the second quarter of 2008 compared with the second quarter of 2007,
and decreased by seven percent to $11.6 million for the first six months of
2008, compared with the same period in 2007, primarily as a result of the
weak commercial construction market.
Safe Harbor Statement
This news release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act, as amended, that are based on management's
belief, assumptions, current expectations, estimates and projections about
the global automotive industry, the economy, the impact of stock option
expense, the ability to leverage fixed manufacturing overhead costs, unit
shipment and revenue growth rates, the ability to control ER&D and SG&A
expenses, gross margins, and the Company itself. Words like "anticipates,"
"believes," "confident," "estimates," "expects," "forecast," "likely,"
"plans," "projects," and "should," and variations of such words and similar
expressions identify forward-looking statements. These statements do not
guarantee future performance and involve certain risks, uncertainties, and
assumptions that are difficult to predict with regard to timing, expense,
likelihood and degree of occurrence. These risks include, without
limitation, employment and general economic conditions, the pace of
automotive production worldwide, the maintenance of the Company's market
share, competitive pricing pressures, the ability to achieve purchasing
cost reductions, currency fluctuations, interest rates, equity prices, the
financial strength of the Company's customers, supply chain disruptions,
potential sale of OEM business segments or suppliers, the mix of products
purchased by customers, the ability to continue to make product
innovations, the success of certain newer products (e.g. SmartBeam®,
Z-Nav® and Rear Camera Display Mirror), and other risks identified in the
Company's filings with the Securities and Exchange Commission. Therefore,
actual results and outcomes may materially differ from what is expressed or
forecasted. Furthermore, the Company undertakes no obligation to update,
amend, or clarify forward-looking statements, whether as a result of new
information, future events, or otherwise.
Second Quarter Conference Call
A conference call related to this news release will be simulcast live on
the Internet beginning at 10:30 a.m. Eastern Daylight Saving Time today. To
access that call, go to
www.gentex.com and select the "Audio Webcast" icon
in the lower right-hand corner of the page. Other conference calls hosted
by the Company will also be available at that site in the future.
About the Company
Founded in 1974, Gentex Corporation (
NASDAQ:
GNTX) is an international
company that provides high-quality products to the worldwide automotive
industry and North American fire protection market. Based in Zeeland,
Michigan, the Company develops, manufactures and markets interior and
exterior automatic-dimming automotive rearview mirrors that utilize
proprietary electrochromic technology to dim in proportion to the amount of
headlight glare from trailing vehicle headlamps. Many of the mirrors are
sold with advanced electronic features, and approximately 96 percent of the
Company's revenues are derived from the sales of auto-dimming mirrors to
nearly every major automaker in the world.
GENTEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
------------- ------------- ------------- -------------
Net Sales $ 170,491,552 $ 163,479,812 $ 348,461,831 $ 320,685,794
Costs and
Expenses
Cost of Goods
Sold 111,411,298 $ 105,782,966 226,734,586 208,410,186
Engineering,
Research &
Development 13,398,456 $ 12,446,469 26,134,743 24,722,131
Selling,
General &
Administrative 9,892,080 $ 8,732,630 19,815,616 17,099,201
Other Expense
(Income) (4,230,322) ($ 8,447,283) (9,705,791) (17,981,306)
------------- ------------- ------------- -------------
Total Costs and
Expenses 130,471,512 118,514,782 262,979,154 232,250,212
------------- ------------- ------------- -------------
Income Before
Provision
for Income
Taxes 40,020,040 44,965,030 85,482,677 88,435,582
Provision for
Income Taxes 13,161,679 14,008,923 28,176,181 27,981,766
------------- ------------- ------------- -------------
Net Income $ 26,858,361 $ 30,956,107 $ 57,306,496 $ 60,453,816
============= ============= ============= =============
Earnings Per
Share
Basic $ 0.19 $ 0.22 $ 0.40 $ 0.42
Diluted $ 0.19 $ 0.22 $ 0.40 $ 0.42
Weighted
Average
Shares:
Basic 142,239,378 142,543,923 142,762,929 142,356,126
Diluted 142,575,626 143,477,655 142,904,951 143,047,008
Cash Dividends
Declared per
Share $ 0.105 $ 0.095 $ 0.210 $ 0.19
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
June 30, December 31,
2008 2007
------------- -------------
ASSETS
Cash and
Short-Term
Investments $ 376,919,395 $ 397,988,781
Other Current
Assets 141,237,880 130,505,167
------------- -------------
Total Current
Assets 518,157,275 528,493,948
Plant and
Equipment -
Net 216,322,783 205,609,671
Long-Term
Investments
and Other
Assets 135,991,063 163,919,061
------------- -------------
Total Assets $ 870,471,121 $ 898,022,680
============= =============
LIABILITIES AND
SHAREHOLDERS'
INVESTMENT
Current
Liabilities $ 69,815,977 $ 68,362,705
Long-Term Debt 0 0
Deferred Income
Taxes 18,715,357 22,847,779
Shareholders'
Investment 781,939,787 806,812,196
------------- -------------
Total
Liabilities &
Shareholders'
Investment $ 870,471,121 $ 898,022,680
============= =============
Gentex Corporation
AUTO-DIMMING MIRROR UNIT SHIPMENTS
(Thousands)
Second Quarter Six Months
Ended June 30, Ended June 30,
-------------- --------------
% %
2008 2007 Change 2008 2007 Change
----- ----- ------ ----- ----- ------
Domestic Interior 1,130 1,248 -9% 2,347 2,423 -3%
----- ----- ------ ----- ----- ------
Domestic Exterior 344 450 -24% 788 906 -13%
----- ----- ------ ----- ----- ------
Total Domestic Units 1,474 1,698 -13% 3,135 3,329 -6%
----- ----- ------ ----- ----- ------
----- ----- ------ ----- ----- ------
Foreign Interior 1,727 1,558 11% 3,492 3,063 14%
----- ----- ------ ----- ----- ------
Foreign Exterior 712 618 15% 1,453 1,260 15%
----- ----- ------ ----- ----- ------
Total Foreign Units 2,439 2,176 12% 4,945 4,323 14%
----- ----- ------ ----- ----- ------
----- ----- ------ ----- ----- ------
Total Interior Mirrors 2,857 2,806 2% 5,839 5,486 6%
----- ----- ------ ----- ----- ------
Total Exterior Mirrors 1,056 1,068 -1% 2,241 2,166 4%
----- ----- ------ ----- ----- ------
Total Mirror Units 3,913 3,874 1% 8,080 7,652 6%
----- ----- ------ ----- ----- ------
Note: Certain prior year amounts have been reclassified to conform with the
current year presentation. Percent change and amounts may not
total due to rounding.
Contact Information: CONTACT:
Connie Hamblin
(616) 772-1800