Superior Reports 30% Rise in Profit
Superior Industries International Inc., a leading producer of car and light-truck wheels, posted a 30% jump in first-quarter net income Friday, but warned that profit for the year will fall short of previous estimates because of a slowdown in sales by key automakers.
First-quarter net income for the Van Nuys-based company rose 30% to $22.3 million, or 83 cents a share, compared with $17.2 million, or 65 cents, the previous year.
Sales in the latest quarter rose 12% to $208 million, up from $186.5 million a year earlier.
“Superior delivered an outstanding first quarter,” said President and Chief Operating Officer Steve Borick.
But Borick acknowledged there were concerns about the company’s second quarter because of “production cut-backs for certain models recently announced by some of our customers.”
About 85% of Superior’s business comes from General Motors Corp. and Ford Motor Co. General Motors recently said it would trim its output of cars and lights trucks by 10%, and Ford plans to cut production by 17%.
On a conference call with analysts, Superior Chief Financial Officer Jeffrey Ornstein said the company would earn $3.10 a share this year; analysts had expected a profit of $3.34.
Superior is closely tied to the fortunes of Ford and GM, and that worries Lehman Bros. analyst Glenn E. Chin.
“You never want to see a company where the customer base is not diversified,” Chin said.
In the first quarter, Superior also said it bought back 81,000 shares of stock as part of its ongoing repurchase program.
Superior shares fell 28 cents Friday to $37.39 on the New York Stock Exchange.
The company’s stock has fallen 30% since its 52-week high of $53.80 in May.
Bloomberg News was used in compiling this report.
