Visteon Announces First-Quarter 2022 Results
VAN BUREN TOWNSHIP, Mich., April 28, 2022 — Visteon Corporation (NASDAQ: VC) today reported first quarter financial results. Highlights include:
- Sales of $818 million, up 11% from prior year
- Growth-over-market of 22%1 versus top customers' vehicle production
- Net income of $22 million
- Adjusted EBITDA of $71 million or 8.7% of sales
- 16 new products launched in first quarter
- $950 million in new business wins
- $56 million in net cash at quarter end when excluding debt of $349 million
Visteon reported net sales of $818 million, representing a year-over-year increase of 11% excluding the impact of currency. Total industry production decreased 4% while vehicle production at Visteon’s top customers decreased 11%1 in the same period, reflecting supply chain constraints and the worldwide semiconductor shortage. Despite these constraints, the company's sales performance represents 22%1 growth-over-market compared to the production volumes of its customers.
Gross margin in the first quarter was $76 million, and net income attributable to Visteon was $22 million or $0.77 per diluted share. Adjusted EBITDA, a non-GAAP measure as defined below, was $71 million for the first quarter or 8.7% of sales, an increase of $7 million compared to the prior year. The increase in adjusted EBITDA reflects the favorable impact of higher sales volumes, higher pricing, and lower engineering costs. This increase was partially offset by higher semiconductor costs net of customer cost recoveries.
Visteon launched 16 new products in the first quarter and is setting the foundation for another year of robust launch activity. Key first quarter launches include a 12-inch digital cluster for the F-150 Lightning EV that recently launched with Ford and several center information display programs across multiple vehicle lines with Mazda, including their all-new CX-60 plug-in hybrid SUV. Additional key launches include a 10-inch digital cluster on the new Nissan Z and a 10-inch digital cluster on Honda’s first generation all-electric BEV crossover for the China market.
The company won $950 million in new business in the first quarter, approximately 20% of which were for programs with electric vehicle variants. First quarter wins included a global multi-display module program, an additional SmartCore™ customer, and a 7-inch all-digital cluster for a global program on a high-volume sedan with a Japanese OEM.
For the first three months, cash used by operations was $21 million and capital expenditures were $21 million. Adjusted free cash flow, a non-GAAP financial measure as defined below, for the first three months of 2022 was a use of cash of $37 million, compared to a source of cash of $9 million for the same period in 2021. The company ended the first quarter with cash of $405 million and debt of $349 million, representing a net cash position of $56 million.
I am proud of Visteon’s continued performance and our ability to deliver a strong sales quarter and improved earnings versus the prior year in a challenging environment. Our continued growth-over-market is driven by our best-in-class product portfolio and this quarter represents our twelfth consecutive quarter of market outperformance.
Visteon is maintaining full-year 2022 guidance and anticipates sales in the range of $3.150 – $3.350 billion, Adjusted EBITDA in the range of $295 – $335 million, and Adjusted Free Cash Flow in the range of $85 – $115 million.
 Excludes Y/Y impact of currency fluctuations.
Visteon is a technology leader in automotive electronics dedicated to creating a more enjoyable, connected and safe driving experience. Our platforms leverage proven, scalable hardware and software solutions that enable the digital, electric and autonomous evolution of our global automotive customers. Visteon products align with key industry trends and include digital instrument clusters, displays, Android-based infotainment systems, domain controllers, advanced driver assistance systems and battery management systems. Learn more at https://investors.visteon.com/.
Conference Call and Presentation
Today, Thursday, April 28, 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:
Outside U.S./Canada: 720-405-0988
Conference ID: 1329137
(Call approximately 15 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 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 1329137. The phone replay will be available for one week following the conference call.
Use of Non-GAAP Financial Information
Because not all companies use identical calculations, adjusted EBITDA, adjusted net income, adjusted EPS, free cash flow and adjusted free cash flow used throughout this press release may not be comparable to other similarly titled measures of other companies.
In order to provide the forward-looking non-GAAP financial measures for full-year 2022, the company provides reconciliations to the most directly comparable GAAP financial measures on the subsequent slides. The provision of these comparable GAAP financial measures is not intended to indicate that the company 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.
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "will," "may," "designed to," "outlook," "believes," "should," "anticipates," "plans," "expects," "intends," "estimates," "forecasts" and similar expressions identify certain of these forward-looking statements. 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:
• continued and future impacts of the coronavirus (COVID-19) pandemic on our financial condition and business operations including global supply chain disruptions, market downturns, reduced consumer demand and new government actions or restrictions;
• continued and future impacts related to the conflict between Russia and the Ukraine including supply chain disruptions, reduction in customer demand, and the imposition of sanctions on Russia;
• significant or prolonged shortage of critical components from our suppliers, including but not limited to semiconductors, and particularly those who are our sole or primary sources;
• 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, including work stoppages at our customers, 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;
• our ability to execute on our transformational plans and cost-reduction initiatives in the amounts and on the timing contemplated;
• 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;
• our ability to access funds generated by foreign subsidiaries and joint ventures on a timely and cost-effective basis;
• general economic conditions, including changes in interest rates and fuel prices, the timing and expenses related to internal restructurings, employee reductions, acquisitions or dispositions and the effect of pension and other post-employment benefit obligations;
• 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;
• changes in laws, regulations, policies or other activities of governments, agencies and similar organizations, domestic and foreign, that may tax or otherwise increase the cost of, or otherwise affect, the manufacture, licensing, distribution, sale, ownership or use of our products or assets; and
• those factors identified in our filings with the SEC (including our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as updated by our subsequent filings with the Securities and Exchange Commission).
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 Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2022. New business wins and re-wins 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.