GILLINGHAM, England & TROY, Mich. – Delphi Automotive has reported fourth quarter 2012 revenues of $3.8 billion, a decrease of 3.4 percent from the prior year period, the result of further reductions in European production and continued weakness of the euro and Brazilian real, partially offset by increases as a result of acquisitions. Adjusted for the impacts of currency exchange, commodity movements, acquisitions and divestitures, revenue decreased by 4 percent in the fourth quarter.
“Delphi’s fourth quarter financial results reflect the continued high level of execution, particularly in the face of a challenging environment in Europe," said Rodney O’Neal, CEO and president. "As expected, European vehicle production levels continued to be weak, and as previously announced, we initiated significant restructuring actions, primarily in Europe, that we believe will provide future benefits. Maintaining and improving our lean operating structure is of paramount importance to us, and we believe better positions Delphi to provide strong results for our shareholders."
The company reported fourth quarter 2012 revenue of $3.8 billion, a decrease of 4 percent over the fourth quarter of 2011, adjusting for currency exchange, commodity movements, acquisitions and divestitures. This reflects solid growth of 11 percent in Asia, 6 percent growth in North America and 4 percent growth in South America, offset by a 18 percent decline in Europe.
Fourth quarter net income excluding restructuring, asset impairments and acquisition related integration costs ("Adjusted Net Income"), totaled $287 million, or 90 cents per diluted share, which includes the favorable impacts of a lower effective tax rate and share repurchases, partially offset by increased expense resulting from the variable accounting related to the company’s 2010 Long-Term Incentive Plan. Adjusted Net Income in the prior year period was $299 million, or 91 cents per diluted share.
For the full year 2012, the company reported revenue of $15.5 billion, essentially flat compared to 2011, adjusting for currency exchange, commodity movements, acquisitions and divestitures. This reflects growth of 11 percent in Asia and 6 percent in North America, partially offset by a 6 percent decline in Europe and South America, respectively.
The company reported full year 2012 U.S. GAAP net income of $1.1 billion and earnings of $3.33 per diluted share, compared to $1.1 billion or $2.72 per diluted share in the prior year. Full year 2012 Adjusted Net Income totaled $1,240 million, or $3.84 per diluted share, which includes the favorable impact of share repurchases in 2012 and the unfavorable impact from the variable 2010 Long-Term Incentive Plan, compared to Adjusted Net Income of $1,169 million, or $2.78 per diluted share, in the prior year period.
Restructuring and Integration
In light of continued economic uncertainties, particularly in Europe, Delphi expanded its previously announced restructuring activities from $250 million to approximately $300 million, beginning in the fourth quarter of 2012, a move that is intended to improve the company’s cost structure. Delphi recorded restructuring charges of approximately $170 million in the fourth quarter of 2012, including $15 million of related asset impairments, with the balance expected to be recognized throughout 2013.
Approximately 75 percent of the restructuring costs are in Europe, and include workforce reductions as well as plant closures. These actions are expected to be substantially completed by the end of 2013. Additionally, in the fourth quarter, Delphi recognized $22 million of acquisition advisory and integration costs related to the acquisition of the Motorized Vehicles Division from FCI Group in October 2012.
