ZEELAND, MI --
(MARKET WIRE)
-- 04/22/2009 --
Gentex Corporation (NASDAQ: GNTX), the Zeeland,
Michigan-based manufacturer of automatic-dimming rearview mirrors and
commercial fire protection products, today reported results for the first
quarter ended March 31, 2009.
For the first quarter of 2009, the Company's net sales declined by 47
percent to $93.8 million compared with $178.0 million in the first quarter
of 2008. The gross profit margin declined on a period-over-period basis
from 35.2% in the first quarter of 2008 to 23.8% in the first quarter of
2009. Three-quarters of the decline was due to the 47% period-over-period
decline in revenues resulting in the Company's inability to leverage its
fixed overhead costs. The balance of the decline was due to annual
customer price reductions and foreign exchange rates, which were partially
offset by purchasing cost reductions.
Income from operations declined by 95 percent in the first quarter of 2009
to $2.2 million, compared with $40.0 million in the first quarter of 2008,
primarily due to the decline in the gross margin.
The net loss of $1.6 million in the first quarter of 2009 compared with net
income of $30.5 million in the first quarter last year was primarily due to
the reduced operating margin and decrease in other expense (income). Other
expense (income) decreased in the first quarter of 2009 compared with the
same prior-year period, primarily due to realized losses on the sale of
equity investments and lower investment income due to lower interest rates
during the first quarter of 2009. The net loss per diluted share was 1
cent in the first quarter of 2009 compared with earnings per share of 21
cents in the first quarter of 2008.
"The continued weak automotive production environment carried through the
first quarter, resulting in very weak sales for Gentex," said Gentex
Chairman and Chief Executive Officer Fred Bauer. "Light vehicle production
declined by well over 40 percent in each of the three major geographic
areas to which we ship auto-dimming mirrors.
"While we continue to watch and wait for this recession to bottom out, in
the mean time we are working internally to ensure that we continue to
improve our manufacturing processes and yields so that we're ready to go
once it does turn," said Bauer. "There continues to be significant
interest in our newer products, such as the Rear Camera Display Mirrors and
SmartBeam systems, and we expect to announce a number of new programs for
each in calendar 2009. When the production environment starts to recover,
we expect that we will be reporting significantly different news than we
are today," Bauer concluded.
Share Repurchase Plan
During the first quarter, the Company did not repurchase shares. The
Company has a share repurchase plan in place with authorization to
repurchase up to 28 million shares of the Company's common stock. To date,
including the prior share repurchases, the Company has repurchased
approximately 26 million shares, leaving approximately two million shares
authorized to be repurchased under the plan.
Unit Shipments and Revenues
Total auto-dimming mirror unit shipments decreased by 50 percent in the
first quarter of 2009 compared with the first quarter last year.
Automotive revenues decreased by 48 percent from $172.1 million in the
first quarter of 2008 to $89.0 million in the first quarter of 2009.
Auto-dimming mirror unit shipments in North America decreased by 56% in the
first quarter of 2009 compared with the same period in 2008, primarily as a
result of significantly lower light vehicle production. North American
light vehicle production declined by 52% in the first quarter of 2009
compared with the same prior-year period. Total light truck/SUV production
in North America also declined by 52 percent quarter-over-quarter, as
automotive manufacturers significantly reduced or ceased production in
response to poor sales of those vehicles.
In the first quarter of 2009, auto-dimming mirror unit shipments to
offshore customers decreased by 46 percent compared with the same period
last year. The decrease in unit shipments was primarily due to lower light
vehicle production in Asia and Europe. Light vehicle production in Europe
decreased by 42 percent in the first quarter of 2009, and decreased by 43
percent in Japan and Korea in the first quarter of 2009, compared with the
same period last year.
Fire Protection revenues decreased by 17 percent to $4.9 million for the
first quarter of 2009 compared with the same period last year, primarily
due to the weak commercial construction market.
Future Estimates
Gentex Senior Vice President Enoch Jen provided certain guidance for the
second quarter of 2009.
"Based on CSM Worldwide's end-of-March light vehicle production forecast,
we currently expect our revenues in the second quarter of 2009 to decline
by approximately 30 percent compared with the second quarter of 2008," said
Jen. "Light vehicle production in the second quarter of 2009 is currently
expected to decline by 40 percent in North America (including a 42 percent
decline in total light truck/SUV production), by 29 percent in Europe and
by 33 percent in Japan and Korea.
"It continues to be a very difficult operating environment," said Jen, "and
automotive production forecasts are still too unstable for us to provide
full year 2009 guidance with any degree of certainty. While CSM's
end-of-March forecast shows the declines slowly abating throughout calendar
year 2009, that may still prove to be too optimistic."
The Company's current second quarter 2009 forecast is based on CSM's
end-of-March forecast for light vehicle production of 2.1 million units for
North America, 4.2 million units for Europe and 2.5 million units for Japan
and Korea. CSM's current calendar year 2009 forecast for production is a
36 percent decline to 8.2 million light vehicle units for North America; a
23 percent decline to 15.9 million units for Europe, and a 26 percent
decline to 10.7 million units for Japan and Korea.
Safe Harbor Statement
This news release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act, as amended, that are based on management's
belief, assumptions, current expectations, estimates and projections about
the global automotive industry, the economy, the impact of stock option
expense, the ability to control and leverage fixed manufacturing overhead
costs, unit shipment and revenue growth rates, the ability to control E,R&D
and S,G&A expenses, gross margins, and the Company itself. Words like
"anticipates," "believes," "confident," "estimates," "expects," "forecast,"
"hopes," "likely," "plans," "projects," and "should," and variations of
such words and similar expressions identify forward-looking statements.
These statements do not guarantee future performance and involve certain
risks, uncertainties, and assumptions that are difficult to predict with
regard to timing, expense, likelihood and degree of occurrence. These
risks include, without limitation, employment and general economic
conditions, worldwide automotive production, the maintenance of the
Company's market share, the ability to achieve purchasing cost reductions,
competitive pricing pressures, currency fluctuations, interest rates,
equity prices, the financial strength/stability of the Company's customers
(including their Tier 1 suppliers), supply chain disruptions, potential
sale of OEM business segments or suppliers, potential customer (including
their Tier 1 suppliers) bankruptcies, the mix of products purchased by
customers, the ability to continue to make product innovations, the success
of certain newer products (e.g. SmartBeam® and Rear Camera Display
Mirror), and other risks identified in the Company's other filings with the
Securities and Exchange Commission. Therefore, actual results and outcomes
may materially differ from what is expressed or forecasted. Furthermore,
the Company undertakes no obligation to update, amend, or clarify
forward-looking statements, whether as a result of new information, future
events, or otherwise.
First Quarter Conference Call
A conference call related to this news release will be simulcast live on
the Internet beginning at 10:30 a.m. EDT today. To access that call, go to
www.gentex.com and select the "Audio Webcast" icon in the lower right-hand
corner 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 an international
company that provides high-quality products to the worldwide automotive
industry and North American fire protection market. Based in Zeeland,
Michigan, the Company develops, manufactures and markets interior and
exterior automatic-dimming automotive rearview mirrors that utilize
proprietary electrochromic technology to dim in proportion to the amount of
headlight glare from trailing vehicle headlamps. Many of the mirrors are
sold with advanced electronic features, and approximately 96 percent of the
Company's revenues are derived from the sales of auto-dimming mirrors to
nearly every major automaker in the world.
GENTEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
Three Months Ended
March 31,
2009 2008
------------- -------------
Net Sales $ 93,831,477 $ 177,970,279
Cost of Goods Sold 71,521,107 115,323,288
------------- -------------
Gross Profit 22,310,370 62,646,991
Engineering, Research &
Development 11,380,204 12,736,287
Selling, General &
Administrative 8,731,081 9,923,536
------------- -------------
Income from Operations 2,199,085 39,987,168
Other Expense (Income) 4,585,261 (5,475,469)
------------- -------------
Income (Loss) Before Provision
for Income Taxes (2,386,176) 45,462,637
Provision for (Benefit from)
Income Taxes (829,245) 15,014,502
------------- -------------
Net Income (Loss) $ (1,556,931) $ 30,448,135
============= =============
Earnings (Loss) Per Share
Basic $ (0.01) $ 0.21
Diluted $ (0.01) $ 0.21
Weighted Average Shares:
Basic 137,094,907 143,286,480
Diluted 137,094,907 143,566,009
Cash Dividends Declared per
Share 0.110 0.105
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
March 31, December 31,
2009 2008
------------- -------------
ASSETS
Cash and Short-Term
Investments $ 333,380,887 $ 323,483,785
Other Current Assets 131,564,780 133,668,174
------------- -------------
Total Current Assets 464,945,667 457,151,959
Plant and Equipment - Net 211,140,404 214,951,719
Long-Term Investments and
Other Assets 68,961,694 90,999,702
------------- -------------
Total Assets $ 745,047,765 $ 763,103,380
============= =============
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities $ 50,142,252 $ 49,472,438
Long-Term Debt 0 0
Deferred Income Taxes 11,976,419 15,034,620
Shareholders' Investment 682,929,094 698,596,322
------------- -------------
Total Liabilities &
Shareholders' Investment $ 745,047,765 $ 763,103,380
============= =============
GENTEX CORPORATION
AUTO-DIMMING MIRROR UNIT SHIPMENTS
(Thousands)
First Quarter Ended
March 31,
--------------------- ---------
2009 2008 % Change
---------- ---------- ---------
Domestic Interior 552 1,217 -55%
---------- ---------- ---------
Domestic Exterior 180 444 -59%
---------- ---------- ---------
Total Domestic Units 732 1,661 -56%
---------- ---------- ---------
---------- ---------- ---------
Foreign Interior 959 1,765 -46%
---------- ---------- ---------
Foreign Exterior 402 741 -46%
---------- ---------- ---------
Total Foreign Units 1,361 2,506 -46%
---------- ---------- ---------
---------- ---------- ---------
Total Interior Mirrors 1,511 2,982 -49%
---------- ---------- ---------
Total Exterior Mirrors 582 1,185 -51%
---------- ---------- ---------
Total Mirror Units 2,093 4,167 -50%
---------- ---------- ---------
Note: Certain prior year amounts have been reclassified to conform with the
current year presentation. Percent change and amounts may not total due to
rounding.
CONTACT:
Connie Hamblin
(616) 772-1800
