ZEELAND, MI--(Marketwire - January 28, 2010) - Gentex Corporation (
NASDAQ:
GNTX), the Zeeland,
Michigan-based manufacturer of automatic-dimming rearview mirrors and
commercial fire protection products, today reported results for the fourth
quarter and calendar year ended December 31, 2009.
For the fourth quarter of 2009, the Company's net sales increased by 45
percent to $177.6 million compared with $122.3 million in the fourth
quarter of 2008. The gross profit margin increased on a
quarter-over-quarter basis from 28.4 percent in the fourth quarter of 2008
to 36.7 percent in the fourth quarter of 2009, primarily due to the
Company's ability to leverage fixed overhead costs due to the 45 percent
quarter-over-quarter increase in net sales.
For calendar year 2009, the Company's net sales decreased by 13 percent to
$544.5 million compared with $623.8 million for calendar year 2008. The
gross profit margin of 32.6 percent for the 2009 calendar year was flat
compared with the gross margin for calendar year 2008, primarily due to
annual customer price reductions that were offset by purchasing cost
reductions.
Income from operations increased by 343 percent in the fourth quarter of
2009 to $43.2 million, compared with $9.8 million in the fourth quarter of
2008. The increase in operating income was primarily due to the increase
in the gross margin quarter over quarter. Income from operations declined
by 13 percent for calendar year 2009 to $94.6 million compared with $108.8
million for the 2008 calendar year. The decline in operating income for
calendar year 2009 was primarily due to the decline in gross margin
dollars.
Other income was $1.6 million in the fourth quarter of 2009 compared with
other expense of $25.8 million in the fourth quarter last year. The
improvement in the fourth quarter of 2009 was the result of decreased
other-than-temporary-impairment losses on equity investments, and realized
gains on the sale of equity investments in the current quarter, compared
with realized losses in the same prior-year period. Other income was $1.7
million for the calendar year ended December 31, 2009, compared with other
expense of $16.6 million for the same prior-year period. The improvement
year-over-year was primarily due to decreased
other-than-temporary-impairment losses on equity investments and decreased
realized losses on the sale of equity investments, partially offset by
decreased investment income due to lower interest rates.
Net income increased to $30.0 million in the fourth quarter of 2009,
compared with a net loss of $10.4 million in the fourth quarter of 2008,
primarily due to increased operating income aided by improved other income.
For calendar year 2009, net income increased by four percent to $64.6
million compared with net income of $62.1 million in calendar year 2008.
Earnings per diluted share were 22 cents in the fourth quarter of 2009
compared with a loss of eight cents per share in the fourth quarter of
2008. Earnings per diluted share were 47 cents for calendar year 2009
compared with earnings per diluted share of 44 cents during calendar year
2008.
"We are very pleased to report this excellent performance by Gentex in the
fourth quarter," said Gentex Chairman of the Board and Chief Executive
Officer Fred Bauer. "It feels like we are living in a different world now
compared with last year at this time, and these results are a testament to
the Company's ability to leverage its costs when we experience double-digit
revenue growth."
"Our customers continued to build vehicle inventories during the fourth
quarter of 2009, as the Company's December 2009 sales ended significantly
stronger than they have historically," said Bauer. "We did not have as
many customer holiday plant shutdowns as have been typical during the
fourth quarter of the calendar year."
"Increased penetration of Rear Camera Display (RCD) Mirrors and
SmartBeam®, along with increased mirror unit shipments, were the primary
drivers behind the revenue increases in the fourth quarter," said Bauer.
"We expect that RCD Mirrors and SmartBeam will continue to drive the
Company's growth over the next several years."
The Rear Camera Display Mirrors display high-resolution, color images of
what is directly behind the vehicle via an automaker-specified camera.
SmartBeam is the Company's proprietary high beam headlamp assist system.
Share Repurchase Plan
During the fourth quarter, the Company did not repurchase any shares. The
Company has a share repurchase plan in place with authorization to
repurchase up to 28 million shares of the Company's common stock. To date,
including the prior share repurchases, the Company has repurchased
approximately 26 million shares, leaving approximately two million shares
authorized to be repurchased under the plan.
Unit Shipments and Net sales
Total auto-dimming mirror unit shipments increased by 35 percent in the
fourth quarter of 2009 compared with the fourth quarter last year.
Automotive net sales increased by 48 percent from $117.3 million in the
fourth quarter of 2008 to $173.4 million in the fourth quarter of 2009.
Total auto-dimming mirror unit shipments decreased by 19 percent for
calendar year 2009 compared with calendar year 2008. Automotive net sales
decreased by 13 percent from $601.5 million in calendar year 2008 to $525.6
million for calendar year 2009.
Automatic-dimming mirror unit shipments in North America increased by 21
percent in the fourth quarter of 2009 compared with the same period in
2008, primarily as a result of improved vehicle mix weighted toward light
trucks, and new programs. North American light vehicle production was flat
in the fourth quarter of 2009 compared with the same period last year.
Automatic-dimming mirror unit shipments in North America decreased by 27
percent for the 2009 calendar year compared with calendar year 2008,
primarily as a result of significantly lower light vehicle production.
North American light vehicle production declined by 32 percent for calendar
year 2009 compared with the same prior-year period.
Automatic-dimming mirror unit shipments to offshore customers increased by
45 percent in the fourth quarter of 2009 compared with the same period last
year. The increase in unit shipments was primarily due to improved vehicle
mix, new programs and increased take rates. Light vehicle production in
Europe increased by 12% in the fourth quarter of 2009, and decreased by 2%
in Japan and Korea in the fourth quarter of 2009, compared with the same
period last year.
Automatic-dimming mirror unit shipments to offshore customers decreased by
14% for the 2009 calendar year compared with the same period last year.
The decrease in unit shipments was primarily due to lower light vehicle
production in Europe and Asia. Light vehicle production in Europe
decreased by 21% in the 2009 calendar year, and decreased by 25% in Japan
and Korea in the 2009 calendar year, compared with last year.
Fire Protection net sales decreased by 25 percent to $3.7 million for the
fourth quarter of 2009 compared with the same period last year, and
declined by 18 percent for calendar year 2009 to $18.2 million compared
with the same prior-year period. The decline in net sales in both periods
was primarily due to the weak commercial construction market.
Future Estimates
Gentex Senior Vice President Enoch Jen provided certain guidance for the
first quarter of 2010.
"Based on CSM Worldwide's end-of-December light vehicle production forecast
for the first quarter of 2010, we currently expect our net sales in the
first quarter of 2010 to increase by 80-90 percent compared with the first
quarter of 2009," said Jen.
"Light vehicle production volumes have significantly improved, and we are
quite pleased with the prospects for the first quarter," said Jen.
"However, the global automotive market is still a bit unstable and there
continues to be uncertainty. CSM is currently forecasting relatively flat
sequential vehicle production for all four quarters of 2010 when North
America, Europe and Japan and Korea are combined. We continue to believe
that there will be some schedule adjustments as automakers work to balance
their inventories with vehicle sales levels. As such, due to
uncertainties, we do not plan to give full year 2010 guidance at this
time."
The Company's current first quarter 2010 forecast is based on CSM's
end-of-December forecast for light vehicle production of a 56 percent
increase to 2.6 million units for North America; a 23 percent increase to
4.2 million units for Europe, and a 38 percent increase to 3.1 million
units for Japan and Korea.
CSM's current calendar year 2010 forecast for production in North America
is a 24 percent increase to 10.6 million light vehicle units; a one percent
decline to 16.2 million units for Europe, and a 12 percent increase to 12.2
million units for Japan and Korea, when compared with 2009.
Based on the Company's expected net sales for the first quarter of 2010,
Jen said that the Company expects its gross profit margin for the first
quarter of 2010 to be in the same range as the fourth quarter of 2009.
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 ability to control and
leverage fixed manufacturing overhead costs, unit shipment and revenue
growth rates, the ability to control E,R&D and S,G&A expenses, gross
margins, and the Company itself. Words like "anticipates," "believes,"
"confident," "estimates," "expects," "forecast," "hopes," "likely,"
"plans," "projects," "optimistic," 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, worldwide
automotive production, the maintenance of the Company's market share, the
ability to achieve purchasing cost reductions, competitive pricing
pressures, currency fluctuations, interest rates, equity prices, the
financial strength/stability of the Company's customers (including their
Tier 1 suppliers), supply chain disruptions, potential sale of OEM business
segments or suppliers, potential additional customer (including their Tier
1 suppliers) bankruptcies, the mix of products purchased by customers, the
ability to continue to make product innovations, the success of certain
products (e.g. SmartBeam® and Rear Camera Display Mirror), and other
risks identified in the Company's other 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.
Fourth Quarter Conference Call
A conference call related to this news release will be simulcast live on
the Internet beginning at 10:30 a.m. EST 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. More than half of the
Company's automatic-dimming interior mirrors are sold with advanced
electronic features. Approximately 97 percent of the Company's net sales
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
Three Months Ended Year Ended
December 31, December 31,
2009 2008 2009 2008
------------- ------------- ------------- --------------
Net Sales $ 177,607,892 $ 122,281,421 $ 544,522,993 $ 623,799,822
Cost of Goods
Sold 112,513,832 87,578,410 366,968,216 420,672,934
------------- ------------- ------------- --------------
Gross Profit 65,094,060 34,703,011 177,554,777 203,126,888
Engineering,
Research &
Development 12,570,247 12,652,748 47,128,086 51,888,922
Selling,
General &
Administrat-
ive 9,285,547 12,285,244 35,807,622 42,425,050
------------- ------------- ------------- --------------
Income from
Operations 43,238,266 9,765,019 94,619,069 108,812,916
Other Expense
(Income) (1,615,618) 25,757,662 (1,733,234) 16,618,055
------------- ------------- ------------- --------------
Income Before
Income Taxes 44,853,884 (15,992,643) 96,352,303 92,194,861
Provision for
Income Taxes 14,806,029 (5,627,538) 31,715,218 30,106,914
------------- ------------- ------------- --------------
Net Income $ 30,047,855 ($ 10,365,105) $ 64,637,085 $ 62,087,947
============= ============= ============= ==============
Earnings Per
Share
Basic $ 0.22 ($ 0.08) $ 0.47 $ 0.44
Diluted $ 0.22 ($ 0.08) $ 0.47 $ 0.44
Weighted
Average
Shares:
Basic 137,418,113 137,890,462 137,227,677 140,902,304
Diluted 138,372,258 137,890,462 137,645,350 141,004,936
Cash Dividends
Declared per
Share $ 0.11 $ 0.11 $ 0.44 $ 0.43
CONDENSED CONSOLIDATED BALANCE SHEETS
Dec 31, Dec 31,
2009 2008
-------------- --------------
ASSETS
Cash and Short-Term Investments $ 353,232,093 $ 323,483,785
Other Current Assets 152,181,402 133,668,174
-------------- --------------
Total Current Assets 505,413,495 457,151,959
Plant and Equipment - Net 197,530,249 214,951,719
Long-Term Investments and Other Assets 119,659,745 90,999,702
-------------- --------------
Total Assets $ 822,603,489 $ 763,103,380
============== ==============
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities $ 58,637,778 $ 49,472,438
Long-Term Debt 0 0
Deferred Income Taxes 28,036,968 15,034,620
Shareholders' Investment 735,928,743 698,596,322
-------------- --------------
Total Liabilities & Shareholders' Investment $ 822,603,489 $ 763,103,380
============== ==============
AUTO-DIMMING MIRROR UNIT SHIPMENTS
(Thousands)
Fourth Quarter Year Ended
Ended December 31, December 31,
----------------- -----------------
2009 2008 % Change 2009 2008 % Change
-------- -------- ------- -------- -------- -------
Domestic Interior 1,046 842 24% 3,086 4,095 -25%
-------- -------- ------- -------- -------- -------
Domestic Exterior 262 238 10% 862 1,285 -33%
-------- -------- ------- -------- -------- -------
Total Domestic Units 1,307 1,080 21% 3,949 5,380 -27%
-------- -------- ------- -------- -------- -------
-------- -------- ------- -------- -------- -------
Foreign Interior 1,676 1,141 47% 5,537 6,410 -14%
-------- -------- ------- -------- -------- -------
Foreign Exterior 695 497 40% 2,193 2,598 -16%
-------- -------- ------- -------- -------- -------
Total Foreign Units 2,371 1,638 45% 7,730 9,009 -14%
-------- -------- ------- -------- -------- -------
-------- -------- ------- -------- -------- -------
Total Interior
Mirrors 2,721 1,983 37% 8,623 10,505 -18%
-------- -------- ------- -------- -------- -------
Total Exterior
Mirrors 957 735 30% 3,055 3,884 -21%
-------- -------- ------- -------- -------- -------
Total Mirror Units 3,678 2,718 35% 11,678 14,389 -19%
-------- -------- ------- -------- -------- -------
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: GENERAL AND FINANCIAL MEDIA AND INVESTOR CONTACT:
Connie Hamblin
616/772/1800
WEBSITE: www.gentex.com