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Stoneridge Inc. Reports Operating Results (10-Q)

May 10, 2012 | About:
10qk

10qk

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Stoneridge Inc. (SRI) filed Quarterly Report for the period ended 2012-03-31.

Stoneridge Inc has a market cap of $247.8 million; its shares were traded at around $9.09 with a P/E ratio of 11.6 and P/S ratio of 0.3.

Highlight of Business Operations:

Our first quarter 2012 net sales were positively affected by improvements in the North American automotive and commercial vehicle markets. Production volumes in the North American automotive vehicle market increased by 16.3% during the first quarter of 2012 when compared to the first quarter of 2011. This automotive vehicle market production volume increase had a positive effect on our North American automotive vehicle market net sales of approximately $3.3 million, primarily within our Control Devices segment. The commercial vehicle market production volumes in North America improved by 32.0% during the first quarter of 2012 when compared to the prior year first quarter, which resulted in increased net sales of approximately $7.1 million, primarily within our Electronics segment. Our 2012 first quarter net sales were further favorably affected by approximately $6.2 million, primarily within the Electronics segment, due to production volume increases within the agricultural vehicle market. These increases in net sales were unfavorably affected by foreign currency exchange rates, primarily at our European Electronics operation, of approximately $1.4 million during the first quarter of 2012 when compared to the first quarter of 2011.

Our Electronics segment was positively affected by increased volume in our served markets by approximately $10.6 million for the first quarter of 2012 when compared to the prior year first quarter. The increase in net sales for our Electronics segment was primarily due to volume increases for our North American commercial vehicle products. Commercial vehicle market production volumes in North America increased by 32.0% during the first quarter of 2012 when compared to the prior year first quarter. The increase in North American commercial vehicle production positively affected net sales in our Electronics segment for the first quarter of 2012 by approximately $6.4 million or 11.5%. Net sales within our Electronics segment were also favorably affected by approximately $5.8 million as a result of production volume increases in the agricultural vehicle market during the first quarter of 2012 when compared to the prior year first quarter. In addition, the Electronics segment net sales were unfavorably affected by foreign currency fluctuations of approximately $1.4 million for the first quarter of 2012 when compared to the first quarter of 2011.

Our Control Devices segment was positively affected by increased volume in our served markets by approximately $4.7 million for the first quarter of 2012 when compared to the prior year first quarter. The increase in net sales for our Control Devices segment was primarily attributable to production volume increases at our major customers in the North American automotive vehicle market, which increased by 16.3% during the first quarter of 2012 when compared to the first quarter of 2011. Volume increases within the automotive vehicle market of our Control Devices segment increased net sales for the first quarter of 2012 by approximately $3.2 million, or 6.2%, when compared to the prior year first quarter. In addition, our Control Devices net sales were approximately $0.8 million and $0.2 million higher for the first quarter of 2012, when compared to the first quarter of 2011 as a result of production volume increases within the commercial and agricultural vehicle markets, respectively.

The increase in North American net sales was primarily attributable to increased sales volume in our North American commercial, agricultural and automotive vehicle markets. These increased volume levels had a positive effect on our net sales for the first quarter of 2012 of $7.1 million, $6.2 million and $3.3 million for our North American commercial, agricultural and automotive vehicle markets, respectively. Our increase in net sales in South America was due to the acquisition of a controlling interest in PST such that PST’s revenues are consolidated for the first quarter of 2012. Our decrease in net sales in Europe and Other was primarily due to decreased sales of European commercial vehicle market products. In addition, our first quarter 2012 net sales outside of North America were unfavorably affected by foreign currency fluctuations of approximately $1.4 million.

Our gross margin increased to 24.8% for the first quarter of 2012 compared to 20.4% for the first quarter of 2011 primarily due to improvements in labor productivity, favorable fluctuations in certain commodity prices and foreign currency exchange rates and lower overhead costs. Our gross margin for the first quarter of 2012 compared to the prior year for our Electronics reportable segment was positively affected by improvements in labor productivity, lower premium freight, and favorable fluctuations in certain commodity prices and foreign currency exchange rates, primarily copper and the Mexican peso. The improvement in labor productivity and premium freight that positively affected gross margin totaled $5.1 million. The decreases in commodity and foreign exchange rates positively impacted our results by approximately $1.0 million and $0.5 million, respectively, during the current quarter. In contrast, our Control Devices segment gross margin was negative impacted by higher materials cost primarily a result of higher commodity prices, principally precious metals, rare earth magnets and resins, during the current quarter. Material cost of the Control Devices segment a percentage of sales for the Control Devices segment increased from 54.8% for the first quarter of 2011 to 57.6% for the first quarter of 2012.

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