SOURCE: Gentex Corporation

Gentex Corporation

January 29, 2014 08:00 ET

Gentex Reports Fourth Quarter and Year End 2013 Financial Results

ZEELAND, MI--(Marketwired - Jan 29, 2014) -  Gentex Corporation (NASDAQ: GNTX), the Zeeland, Michigan-based manufacturer of automotive automatic-dimming rearview mirrors, automotive electronics, dimmable aircraft windows, and fire protection products, today reported financial results for the fourth quarter and calendar year ended December 31, 2013.

For the fourth quarter of 2013, the Company's net sales were $326.8 million, up 26% compared with net sales of $260.3 million in the fourth quarter of 2012. For calendar year 2013, the Company's net sales increased 7% to $1.17 billion compared to $1.10 billion for calendar year 2012.

The gross profit margin in the fourth quarter of 2013 was 39.4%, compared with a gross profit margin of 34.2% in the fourth quarter of 2012, due to improvements in product mix, the impact of the HomeLink® acquisition, the Company's ability to leverage fixed overhead costs, and purchasing cost reductions, which were partially offset by annual customer price reductions. The gross profit margin for calendar year 2013 was 36.8%, compared with a gross profit margin of 33.9% for calendar year 2012, primarily due to improvements in product mix and purchasing cost reductions, which were partially offset by annual customer price reductions.

Net income for the fourth quarter of 2013 was $69.9 million, up 76% compared with net income of $39.6 million in the fourth quarter of 2012. Net income in calendar year 2013 was $222.9 million, up 32% compared with net income of $168.6 million in calendar year 2012.

Earnings per diluted share in the fourth quarter of 2013 were $0.48, an increase of $0.20 compared with earnings per diluted share of $0.28 in the fourth quarter of 2012. Earnings per diluted share were $1.55 for calendar year 2013 compared with $1.17 for calendar year 2012.

"Gentex is excited by the continuation of the strong improvements in our gross profit margin and continued discipline in our operating expenses over the last several quarters," said Gentex Chairman of the Board, and Chief Executive Officer, Fred Bauer. "These improvements are driven by an overall improvement in the core mirror business, the first full quarter of combined results from the HomeLink acquisition, and HomeLink integration that is running slightly ahead of the Company's original projections," continued Bauer.

Mirror Unit Shipments and Net Sales

Automotive mirror unit shipments in the fourth quarter of 2013 increased 17% compared with the fourth quarter of 2012. Automotive net sales in the fourth quarter of 2013 were $320.3 million, up 26% compared with automotive net sales of $254.6 million in the fourth quarter of 2012. Automotive mirror unit shipments for calendar year 2013 increased 10% compared to calendar year 2012. Automotive net sales for calendar year 2013 were $1.14 billion, up 6% compared with automotive net sales of $1.07 billion in calendar year 2012.

"It's our directive at Gentex to achieve profitable growth, whether organically or acquired, in spite of challenges like those we faced in 2013, with vehicle production flat to down in Europe, Japan, and Korea," said Mark Newton, Gentex Senior Vice President, "and we're doing it, as demonstrated by our growth in sales, the 5.2 percentage point increase in gross profit margin quarter over quarter, and the 2.9 percentage point increase in gross profit margin year over year. We are expected to manage this growth in spite of challenges, and to do so with sound expense management at the same time, and we're doing that too," continued Newton.

Other net sales for dimmable aircraft windows and fire protection products in the fourth quarter of 2013 were $6.5 million, up 12% compared with $5.8 million in the fourth quarter of 2012, and for calendar year 2013 were $27.9 million, up 23% compared with $22.6 million for calendar year 2012.

Future Estimates

The Company's forecasts for light vehicle production for each of the following periods in 2014 compared with the same periods in 2013 are based on the IHS Automotive January 2014, forecast for light vehicle production in North America, Europe, Japan and Korea.

 
Light Vehicle Production (per IHS Automotive's January light vehicle production forecast)
(in Millions)
Region   1st Quarter 2014   1st Quarter 2013   % Change   Calendar Year 2014   Calendar Year 2013   % Change
North America   4.27   4.01   6 %   16.8   16.2   4 %
Europe   5.03   4.82   4 %   19.6   19.3   2 %
Japan and Korea   3.60   3.34   8 %   12.7   13.5   (6 )%
                             

Based on the January 2014 IHS production forecast and current forecasted product mix, the Company estimates that net sales in the first quarter of 2014 will increase approximately 20% compared to the first quarter of 2013 and estimates the gross profit margin to be approximately 39%.

The Company also estimates that E, R&D expense for the first quarter of 2014 will increase 10 - 15% compared with E, R&D in the first quarter of 2013. S, G&A expense is estimated to increase 20 - 25% compared with the first quarter of 2013.

Safe Harbor for Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The statements contained in this communication that are not purely historical are forward-looking statements. Forward-looking statements give the Company's current expectations or forecasts of future events. These forward-looking statements generally can be identified by the use of words such as "anticipate", "believe", "could", "estimate", "expect", "forecast", "goal", "hope", "may", "plan", "project", "will", and variations of such words and similar expressions. Such statements are subject to risks and uncertainties that are often difficult to predict and beyond the Company's control, and could cause the Company's results to differ materially from those described. These risks and uncertainties include, without limitation, changes in general industry or regional market conditions; changes in consumer and customer preferences for our products; our ability to be awarded new business; continued uncertainty in pricing negotiations with customers; loss of business from increased competition; customer bankruptcies or divestiture of customer brands; fluctuation in vehicle production schedules; changes in product mix; raw material shortages; higher raw material, fuel, energy and other costs; unfavorable fluctuations in currencies or interest rates in the regions in which we operate; costs or difficulties related to the integration of any new or acquired technologies and businesses; changes in regulatory conditions; warranty and recall claims and other litigation and customer reactions thereto; possible adverse results of pending or future litigation or infringement claims; negative impact of any governmental investigations and associated litigations including securities litigations relating to the conduct of our business; integration of the newly acquired HomeLink business operations; retention of the newly acquired customers of the HomeLink business; and expansion of product offerings including those incorporating HomeLink technology. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law or the rules of the Nasdaq Global Select Market. Accordingly, any forward-looking statement should be read in conjunction with the additional information about risks and uncertainties identified under the heading "Risk Factors" in the Company's latest Form 10-K and Form 10-Q filed with the SEC.

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, January 29, 2014. To access that call, go to www.gentex.com and select the "Audio Webcast" icon on the bottom 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 a supplier of automatic-dimming rearview mirrors and electronics to the automotive industry, dimmable aircraft windows for aviation markets, and fire protection products to the fire protection market. Visit the Company's web site at www.gentex.com.

   
GENTEX CORPORATION  
AUTO-DIMMING MIRROR SHIPMENTS  
(Thousands)  
   
Three Months Ended December 31,
    Twelve Months ended December 31,  
    2013   2012   % Change     2013   2012   % Change  
North American Interior Mirrors   1,961   1,928   2 %   7,858   7,726   2 %
North American Exterior Mirrors   548   445   23 %   2,179   1,736   26 %
  Total North American Mirror Units   2,509   2,372   6 %   10,038   9,462   6 %
International Interior Mirrors   2,987   2,414   24 %   11,493   10,355   11 %
International Exterior Mirrors   1,180   919   28 %   4,673   4,015   16 %
  Total International Mirror Units   4,167   3,333   25 %   16,167   14,370   13 %
Total Interior Mirrors   4,948   4,342   14 %   19,351   18,081   7 %
Total Exterior Mirrors   1,728   1,363   27 %   6,853   5,751   19 %
  Total Auto-Dimming Mirror Units   6,676   5,705   17 %   26,204   23,832   10 %
                             

Note: Percent change and amounts may not total due to rounding.

 
 
 
GENTEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
   
Three Months Ended December 31,
  Twelve Months ended December 31,
    2013   2012   2013   2012
Net Sales   $ 326,769,678   $ 260,349,122   $ 1,171,864,171   $ 1,099,559,521
  Cost of Goods Sold     198,075,383     171,230,430     741,131,269     726,740,962
    Gross profit     128,694,295     89,118,692     430,732,902     372,818,559
                         
  Engineering, Research & Development     19,840,611     18,561,953     76,495,051     85,003,602
  Selling, General & Administrative     13,218,027     11,738,057     49,496,038     48,359,725
  Litigation Settlement     --     5,000,000     --     5,000,000
  Income from operations     95,635,657     53,818,682     304,741,813     234,455,232
  Other Income     8,502,281     4,653,819     23,322,230     15,170,368
Income before Income Taxes     104,137,938     58,472,501     328,064,043     249,625,600
Provision for Income Taxes     34,256,914     18,873,867     105,134,094     81,038,760
Net Income   $ 69,881,024   $ 39,598,634   $ 222,929,949   $ 168,586,840
                         
Earnings Per Share                        
  Basic   $ 0.48   $ 0.28   $ 1.55   $ 1.18
  Diluted   $ 0.48   $ 0.28   $ 1.55   $ 1.17
Weighted Average Shares                        
  Basic     144,344,829     142,151,791     143,460,018     143,097,530
  Diluted     145,756,809     142,588,023     144,274,171     143,968,031
                         
Cash Dividends Declared per Share   $ 0.14   $ 0.13   $ 0.56   $ 0.52
                         
 
 
GENTEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
    December 31, 2013   December 31, 2012
ASSETS            
Cash and Short-Term Investments   $ 309,591,724   $ 450,481,520
Other Current Assets     291,594,518     294,181,520
Total Current Assets     601,186,242     744,663,040
             
Plant and Equipment - Net     357,021,225     349,938,172
             
Goodwill     307,365,845     --
Long-Term Investments     107,005,522     141,834,034
Patents and Other Assets     391,509,600     29,256,089
Total Other Assets     805,880,967     171,090,123
             
Total Assets   $ 1,764,088,434   $ 1,265,691,335
             
LIABILITIES AND SHAREHOLDERS' INVESTMENT            
Current Liabilities   $ 119,980,414   $ 87,957,442
Long-Term Debt     265,625,000     --
Deferred Income Taxes     50,879,337     56,773,337
Shareholders' Investment     1,327,603,683     1,120,960,556
Total Liabilities & Shareholders' Investment   $ 1,764,088,434   $ 1,265,691,335

Contact Information

  • Investor & Media Contact Information:
    Gentex Corporation
    616-772-1590 x5117