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Stoneridge Inc. Reports Operating Results (10-Q)

August 09, 2012 | About:
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10qk

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Stoneridge Inc. (SRI) filed Quarterly Report for the period ended 2012-06-30.

Stoneridge, Inc. has a market cap of $170 million; its shares were traded at around $5.99 with a P/E ratio of 7.1 and P/S ratio of 0.2.

Highlight of Business Operations:

The increase in income before taxes in the Electronics reportable segment was primarily due to increased sales volume in the second quarter of 2012 when compared to the second quarter of 2011. Production volume increases favorably affected our net sales within the Electronics segment by approximately $4.1 million for the second quarter of 2012 when compared to the prior year second quarter. Also, our Electronics reportable segment was positively affected by improvements in labor productivity, premium freight, a fluctuation in foreign currency exchange rates, primarily the Mexican peso. The improvement in labor productivity and premium freight that positively affected our results totaled $1.3 million. The change in foreign exchange rates positively impacted our results by approximately $1.3 million during the current quarter. Our Electronics segment was negatively impacted by higher product development costs of $1.5 million primarily due to reduced customer reimbursement.

Our Electronics segment sales were positively affected by increased volume in our served markets by approximately $14.7 million as well as new business for the first half of 2012 when compared to the prior year. 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 during the first half of 2012 when compared to the prior year. The increase in North American commercial vehicle production positively affected net sales in our Electronics segment for the first half of 2012 by approximately $6.5 million. Net sales within our Electronics segment were also favorably affected by approximately $11.3 million as a result of production volume increases in the agricultural vehicle market during the first half of 2012 when compared to the prior year. The Electronics segment increase in net sales was partially offset by lower European automotive vehicle sales and an unfavorable foreign currency translation of approximately $5.0 million for the first half of 2012 when compared to the first half of 2011.

Our Control Devices segment sales were positively affected by increased volume in our served markets by approximately $8.3 million for the first half of 2012 when compared to the prior year. 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 during the first half of 2012 when compared to the first half of 2011. Volume increases within the automotive vehicle market of our Control Devices segment increased net sales for the first six months of 2012 by approximately $6.1 million, when compared to the prior year first half. In addition, our Control Devices net sales were approximately $1.4 million and $0.2 million higher for the first half of 2012, when compared to 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 agricultural, commercial and automotive vehicle markets. These increased volume levels had a positive effect on our net sales for the first half of 2012 of $11.9 million, $7.7 million and $6.2 million for our North American agricultural, commercial and automotive vehicle markets, respectively. Our net sales in South America were due to the acquisition of a controlling interest in PST such that PST’s revenues are consolidated for the first half of 2012. Our decrease in net sales in Europe and Other was primarily due to decreased sales volume of European automotive vehicle market products and unfavorable foreign currency translation of approximately $4.9 million for the first half of 2012.

The increase in income before taxes in the Electronics reportable segment was primarily due to a 6.6% increase in sales volume in the first half of 2012 when compared to the first half of 2011. Production volume increases favorably affected our net sales within the Electronics segment by approximately $14.7 million for the first half of 2012 when compared to the prior year. Also, our Electronics reportable segment was positively affected by improvements in labor productivity, premium freight, fluctuations in foreign currency exchange rates and certain commodity prices, primarily the Mexican peso and copper, respectively. The improvement in labor productivity and premium freight that positively affected our results for the first half of 2012 was $6.4 million. The decreases in foreign exchange rates and commodity rates positively impacted our results by approximately $1.7 million and $1.1 million, respectively. Our Electronics segment was negatively impacted by higher product development costs of $1.2 million primarily due to reduced customer reimbursement.

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