ZEELAND, Mich., July 20 /PRNewswire-FirstCall/ -- Gentex Corporation
(Nasdaq: GNTX), the Zeeland, Michigan-based manufacturer of automatic-dimming
rearview mirrors and commercial fire protection products, today reported
second quarter revenues and net income for the quarter ended June 30, 2005.
The Company also announced that the Executive Committee of the Board of
Directors has authorized an increase in the price at which the Company may
repurchase shares under the existing share repurchase plan. In a separate
announcement, the Company reported that BMW will offer the Company's new
SmartBeam technology on three vehicle models beginning this fall.
The Company reported quarterly revenues of $132.4 million, a two percent
increase over revenues of $129.6 million reported in the second quarter last
year. Second quarter net income of $26.0 million decreased by ten percent
compared with net income of $29.0 million in the comparable 2004 quarter.
Earnings per diluted share were 17 cents in the second quarter of 2005
compared with 18 cents in the second quarter of 2004. All per share data
reflect the two-for-one stock split effected in the form of a 100 percent
common stock dividend that became effective on May 9, 2005.
For the first six months of 2005, the Company posted net income of $52.0
million on revenues of $260.0 million, compared with net income of $58.8
million on revenues of $259.0 million for the same period in 2004. Earnings
per diluted share were 33 cents for the first six months of 2005 compared with
37 cents for the same period in 2004.
Mirror unit shipments in North America in the second quarter increased by
one percent while light vehicle production in that market declined by two
percent, as lower unit shipments to the "Detroit 3" automakers were more than
offset by shipments to the Asian and European transplants in North America.
Due to high inventories of certain domestic full-sized sport-utility vehicles
throughout most of the second quarter, production of those vehicles was lower
than forecasted. In addition, the Company experienced a few short-term new
program delays during the second quarter, and sales to certain tier one mirror
customers were lower than expected as those customers made adjustments by
reducing inventories at the end of the quarter.
"While the new vehicle sales incentive programs currently being offered by
the 'Detroit 3' automakers are moving vehicles off the lots and reducing auto
dealer inventories, Gentex benefits only when production increases on the
vehicles offering our mirror products. This did not, for the most part,
happen with those customers during the second quarter," said Garth Deur,
Gentex executive vice president. "And, while it is difficult for us to
anticipate, it is not unusual for tier one exterior mirror customers to reduce
their own inventories near the end of a model year, which ultimately impacts
our shipments during the quarter."
The Company reported a somewhat weaker than expected gross margin in the
second quarter, which was primarily attributable to lower unit shipment growth
resulting in reduced capacity utilization.
Total auto-dimming mirror unit shipments for the second quarter of 2005
increased by three percent to 3,095,000 units, compared with 3,001,000 units
for the same quarter in 2004. Total automotive revenues in the second quarter
of 2005 increased by two percent to $126.1 million, compared with the same
quarter last year.
Total auto-dimming mirror unit shipments for the first six months of 2005
increased by two percent to 6,125,000 units, compared with 5,983,000 units for
the same period in 2004. Total automotive revenues were approximately flat
for the first six months of 2005 at $248.1 million, compared with $247.6
million in the same period in 2004.
Auto-dimming mirror unit shipments to offshore customers increased by five
percent in the second quarter of 2005 compared with the second quarter of
2004. Light vehicle production declined by one percent in Europe and the
Japan and Korean markets in the second quarter of 2005 compared with the same
quarter last year.
For the first six months of 2005, auto-dimming mirror unit shipments to
offshore customers increased by six percent compared with the same prior year
period. When comparing those same periods, auto-dimming mirror unit shipments
in North America declined by two percent. During the first six months of
2005, light vehicle production was flat in Europe and increased by two percent
in the Japan and Korean markets, compared with the first six months of 2004.
Light vehicle production in North America decreased by three percent for the
first six months of 2005 compared with the same period last year.
For the third quarter of 2005, the Company estimates that the growth in
mirror unit shipments will be in the range of five to ten percent compared
with the third quarter of 2004. For the fourth quarter of 2005, unit
shipments are estimated to increase by approximately ten to 15 percent
compared with the same prior-year period.
Revenues in the Company's Fire Protection Products Group increased by
eight percent in the second quarter of 2005 to $6.3 million, compared with the
second quarter last year. For the first six months of 2005, fire protection
revenues increased by five percent to $11.9 million.
The Company also announced today that the Executive Committee of the Board
of Directors has authorized an increase in the price at which the Company may
repurchase shares under the existing share repurchase plan. The current share
repurchase plan was announced by the Company in October 2002, and authorizes
the repurchase of up to eight million (split adjusted) shares based on a
number of factors, including market conditions, the market price of the
Company's common stock, anti-dilutive effect on earnings, available cash and
other factors as the Company deems appropriate. Under this plan, the Company
repurchased 830,000 shares in the first quarter of 2003. The Company does not
intend to provide the price at which it will repurchase shares, except as
disclosed in its quarterly Form 10-Q.
In a separate announcement, the Company today reported that BMW will offer
the Company's new SmartBeam high-beam headlamp technology on the 5 Series, 6
Series and 7 Series beginning this fall in Europe and other selected regions.
SmartBeam will be offered in conjunction with Xenon headlamps on those vehicle
models. SmartBeam is the intelligent high-beam headlamp control product
developed by the Company that was introduced in the North American market on
several models for the 2005 and 2006 model years.
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 and the Company itself. Words like
"anticipates," "believes," "confident," "estimates," "expects," "forecast,"
"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, the pace of economic recovery in
the U.S. and in international markets, the pace of automotive production
worldwide, the types of products purchased by customers, competitive pricing
pressures, currency fluctuations, the financial strength of the Company's
customers, the mix of products purchased by customers, the ability to continue
to make product innovations, the success of certain products (e.g. SmartBeam),
and other risks identified in the Company's 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.
A conference call related to this news release will be simulcast live on
the Internet beginning at 1:30 p.m. Eastern Daylight Saving Time today. To
access that call, go to http://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.
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 95 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 Six Months Ended
June 30, June 30,
2005 2004 2005 2004
Net Sales $132,384,445 $129,646,277 $260,026,165 $258,973,825
Costs and Expenses
Cost of Goods
Sold 82,818,876 75,190,805 162,407,779 149,634,081
Engineering,
Research &
Development 8,798,430 7,546,085 16,775,815 14,989,373
Selling, General
& Administrative 7,011,298 6,880,091 13,851,129 13,625,212
Other Expense
(Income) (4,260,209) (2,910,496) (8,883,578) (6,385,108)
Total Costs and
Expenses 94,368,395 86,706,485 184,151,145 171,863,558
Income Before
Provision
for Income Taxes 38,016,050 42,939,792 75,875,020 87,110,267
Provision for
Income Taxes 11,975,000 13,955,000 23,901,000 28,310,000
Net Income $26,041,050 $28,984,792 $51,974,020 $58,800,267
Earnings Per Share
Basic $0.17 $0.19 $0.33 $0.38
Diluted $0.17 $0.18 $0.33 $0.37
Weighted Average
Shares:
Basic 155,568,960 154,123,884 155,396,365 153,921,294
Diluted 157,209,802 156,831,858 156,962,435 156,864,096
Cash Dividends
Declared per
Share $0.085 $0.075 $0.17 $0.15
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
June 30, Dec 31,
2005 2004
ASSETS
Cash and Short-Term Investments $511,812,075 $494,880,260
Other Current Assets 107,223,033 97,728,834
Total Current Assets 619,035,108 592,609,094
Plant and Equipment - Net 152,505,201 135,649,119
Long-Term Investments and Other Assets 134,740,877 128,601,215
Total Assets $906,281,186 $856,859,428
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities $68,102,574 $50,856,258
Long-Term Debt 0 0
Deferred Income Taxes 21,020,714 22,723,198
Shareholders' Investment 817,157,898 783,279,972
Total Liabilities & Shareholders' Investment $906,281,186 $856,859,428
Note: All earnings per share amounts and weighted daily average shares
outstanding reflect the 2-for-1 stock split effected in the form of a 100%
common stock dividend effective on May 9, 2005.
AUTO-DIMMING MIRROR UNIT SHIPMENTS
(Thousands)
Second Quarter Six Months Ended
Ended June 30, June 30,
2005 2004 % Change 2005 2004 % Change
Domestic Interior 1,038 1,007 3% 2,078 2,077 Flat
Domestic Exterior 426 445 -4% 860 908 -5%
Total Domestic Units 1,463 1,452 1% 2,938 2,985 -2%
Foreign Interior 1,190 1,138 5% 2,330 2,204 6%
Foreign Exterior 441 411 7% 857 794 8%
Total Foreign Units 1,631 1,549 5% 3,187 2,999 6%
Total Interior
Mirrors 2,228 2,145 4% 4,408 4,281 3%
Total Exterior
Mirrors 867 856 1% 1,717 1,702 1%
Total Mirror Units 3,095 3,001 3% 6,125 5,983 2%
Note: Certain prior year amounts have been reclassified to conform with
the current year presentation. Amounts may not total due to rounding.
SOURCE Gentex Corporation
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Related links:
http://www.gentex.com
CONTACT:
Connie Hamblin of Gentex Corporation,
+1-616-772-1800
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