21
February
2019
|
12:55
Europe/Amsterdam

Visteon announces 2018 financial results

Sales of $2,984 million ($731 million in fourth quarter)
Net income of $164 million ($43 million in fourth quarter)
Adjusted EBITDA of $330 million ($74 million in fourth quarter)
Awarded $6.9 billion in new business in 2018
Executed $300 million of share repurchases during 2018

VAN BUREN TOWNSHIP, Mich., Feb. 21, 2019 — Visteon Corporation (Nasdaq: VC) today announced full-year 2018 results, reporting net income attributable to Visteon of $164 million or $5.52 per diluted share, compared with $176 million or $5.47 per diluted share in 2017.

Full-year sales in 2018 were $2,984 million, compared with $3,146 million in 2017. The decrease of $162 million is primarily due to unfavorable vehicle production volumes, customer pricing net of design changes, and product mix, partially offset by new business and favorable currency. Net cash provided from operating activities was $204 million for full-year 2018, compared with $215 million in 2017.

In 2018, global vehicle manufacturers awarded Visteon new business of $6.9 billion. New business win growth was driven by new digital products, primarily all-digital clusters and audio infotainment.

 

Sachin Lawande, President and CEO, Visteon
"The market environment in 2018 was very challenging, as vehicle production softened in the second half of the year. Despite these challenges, Visteon made significant progress in the transformation of its business. We launched the industry's first production cockpit domain controller with Daimler and secured significant new business wins in the fast-growing digital cluster and infotainment segments. By winning approximately $7 billion in new business for the second consecutive year - and adding five new customers in the process - we strengthened Visteon’s position toward achieving our long-term growth targets."
Sachin Lawande, President and CEO, Visteon

View the 2018 full-year results here

Fourth Quarter in Review

Sales totaled $731 million and $797 million during the fourth quarters of 2018 and 2017, respectively. The year-over-year decrease was primarily related to unfavorable vehicle production volumes, customer pricing net of design changes, and unfavorable currency impacts. On a regional basis, in the fourth quarter of 2018 Europe accounted for 29 percent of sales; China Domestic 16 percent; China Export 9 percent; the Americas 24 percent; and Other Asia-Pacific 22 percent.

Gross margin for the fourth quarter of 2018 and 2017 was $96 million and $137 million, respectively. Adjusted EBITDA, a non-GAAP measure as defined below, was $74 million for the fourth quarter of 2018, compared with $102 million for the same quarter last year. Adjusted EBITDA margin was 10.1 percent for the fourth quarter of 2018, 270 basis points lower than the same period in the prior year.

For the fourth quarter of 2018, net income attributable to Visteon was $43 million or $1.49 per diluted share, compared with $25 million or $0.79 per diluted share for the same period in 2017. Adjusted net income, which excludes restructuring charges and discontinued operations, was $44 million or $1.52 per diluted share for the fourth quarter of 2018, compared with $52 million or $1.64 per diluted share for the same period in 2017.

Cash and Debt Balances

As of Dec. 31, 2018, Visteon had cash totaling $467 million. Total debt as of Dec. 31 was $405 million.

For the fourth quarter of 2018, cash from operations was $97 million and capital expenditures were $31 million. Full-year cash from operations was $204 million and capital expenditures were $127 million. Total Visteon adjusted free cash flow, a non-GAAP financial measure as defined below, for the fourth quarter and the full-year was $72 million and $107 million, respectively.

Share Repurchases

On Jan. 15, 2018, Visteon's Board of Directors authorized the purchase of up to $700 million of the company's shares outstanding. During 2018, the company completed $300 million of the authorized repurchases by acquiring 2,805,531 shares at an average price of $106.92. As of Dec. 31, 2018, the company had 28.4 million diluted shares of common stock outstanding. Visteon is authorized to purchase an additional $400 million of shares through Dec. 31, 2020.

Full-Year 2019 Outlook

Visteon affirmed its full-year 2019 guidance, with sales in the range of $2.90 billion to $3.00 billion, adjusted EBITDA in the range of $280 million to $310 million, and adjusted free cash flow in the range of $80 million to $100 million.

About Visteon

Visteon is a global technology company that designs, engineers and manufactures innovative cockpit electronics and connected car solutions for the world’s major vehicle manufacturers. Visteon is driving the smart, learning, digital cockpit of the future, to improve safety and the user experience. Visteon is a global leader in cockpit electronic products including digital instrument clusters, information displays, infotainment, head-up displays, telematics, SmartCore™ cockpit domain controllers, and the DriveCore™ autonomous driving platform. Visteon also delivers artificial intelligence-based technologies, connected car, cybersecurity, interior sensing, embedded multimedia and smartphone connectivity software solutions. Headquartered in Van Buren Township, Michigan, Visteon has approximately 10,000 employees at more than 40 facilities in 18 countries. Visteon had sales of approximately $3 billion in 2018. Learn more at www.visteon.com.

Conference Call and Presentation

Today, Thursday, Feb. 21, at 9 a.m. ET, the company will host a conference call for the investment community to discuss the quarter’s results and other related items. The conference call is available to the general public via a live audio webcast.

The dial-in numbers to participate in the call are:

U.S./Canada: 866-411-5196

Outside U.S./Canada: 970-297-2404

(Call approximately 10 minutes before the start of the conference.)

The conference call and live audio webcast, related presentation materials and other supplemental information will be accessible in the investors section of Visteon’s website. A news release on Visteon’s first-quarter results will be available in the news section of the website.

A replay of the conference call will be available through the company’s website or by dialing

855-859-2056 (toll-free from the U.S. and Canada) or 404-537-3406 (international). The conference ID for the phone replay is 3164539. The phone replay will be available for one week following the conference call.

Forward-looking Information
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various factors, risks and uncertainties that could cause our actual results to differ materially from those expressed in these forward-looking statements, including, but not limited to: (1) conditions within the automotive industry, including (i) the automotive vehicle production volumes and schedules of our customers, (ii) the financial condition of our customers and the effects of any restructuring or reorganization plans that may be undertaken by our customers or suppliers, including work stoppages, and (iii) possible disruptions in the supply of commodities to us or our customers due to financial distress, work stoppages, natural disasters or civil unrest; (2) our ability to satisfy future capital and liquidity requirements; including our ability to access the credit and capital markets at the times and in the amounts needed and on terms acceptable to us; our ability to comply with financial and other covenants in our credit agreements; and the continuation of acceptable supplier payment terms; (3) our ability to satisfy pension and other post-employment benefit obligations; (4) our ability to access funds generated by foreign subsidiaries and joint ventures on a timely and cost-effective basis; (5) our ability to execute on our transformational plans and cost-reduction initiatives in the amounts and on the timing contemplated; (6) general economic conditions, including changes in interest rates, currency exchange rates and fuel prices; (7) the timing and expenses related to internal restructuring, employee reductions, acquisitions or dispositions and the effect of pension and other post-employment benefit obligations; (8) increases in raw material and energy costs and our ability to offset or recover these costs, increases in our warranty, product liability and recall costs or the outcome of legal or regulatory proceedings to which we are or may become a party; and (9) those factors identified in our filings with the SEC (including our Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2018).
Caution should be taken not to place undue reliance on our forward-looking statements, which represent our view only as of the date of this release, and which we assume no obligation to update. The financial results presented herein are preliminary and unaudited; final financial results will be included in the company's Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2018. New business wins and rewins do not represent firm orders or firm commitments from customers, but are based on various assumptions, including the timing and duration of product launches, vehicle production levels, customer price reductions and currency exchange rates.
Use of Non-GAAP Financial Information
This press release contains information about Visteon's financial results which is not presented in accordance with accounting principles generally accepted in the United States ("GAAP"). Such non-GAAP financial measures are reconciled to their closest GAAP financial measures at the end of this press release. The provision of these comparable GAAP financial measures for 2018 is not intended to indicate that Visteon is explicitly or implicitly providing projections on those GAAP financial measures, and actual results for such measures are likely to vary from those presented. The reconciliations include all information reasonably available to the company at the date of this press release and the adjustments that management can reasonably predict.