ZEELAND, Mich. — Gentex Corp., the Zeeland, Mich.-based manufacturer of automatic-dimming rearview mirrors and commercial fire protection products, has reported record second quarter revenues for the quarter ended June 30. The company also announced that it repurchased approximately 1.2 million shares of its stock during the second quarter of 2008.
For the second quarter of 2008, the company’s net sales increased by four percent to a record $170.5 million compared with $163.5 million in the second quarter of 2007. The company’s current second quarter operating income declined by two percent, and net income declined by 13 percent, primarily as a result of lower other income due to current stock market conditions. The company reported net income of $26.9 million compared with $31 million for the second quarters of 2008 and 2007, respectively. Earnings per diluted share were 19 cents in the second quarter of 2008 compared with 22 cents in the second quarter of 2007.
For the first six months of 2008, net sales increased by nine percent to $348.5 million compared with $320.7 million in the first six months of 2007. Operating income increased by eight percent for the first six months of 2008 compared with the same period in 2007, while net income decreased by five percent for the first six months of 2008 compared with the same prior-year period. Net income for the first six months of 2008 was $57.3 million compared with $60.5 million for the first six months of 2007, primarily as a result of lower other income due to current stock market conditions. Earnings per diluted share were 40 cents for the first six months of 2008 compared with 42 cents for the first six months of 2007.
During the second quarter, the company repurchased 1.2 million shares at a cost of approximately $19 million. The company has a share repurchase plan in place with authorization to repurchase up to 28 million shares of the company’s stock. To date, including the prior share repurchases, the company has repurchased approximately 21.4 million shares, leaving approximately 6.6 million shares authorized to be repurchased under the plan.
"The second quarter of 2008 is a testament to the company’s success at global sales diversification," said Gentex Chairman and Chief Executive Officer Fred Bauer. "We are operating in an industry that is experiencing the most significant production declines, particularly at the ‘Detroit Three’, since 1991, but our sales still increased by 4 percent in the second quarter. This is due to the fact that nearly 75 percent of the company’s mirror unit shipments are now to automakers headquartered outside North America.
"While our company goal is to achieve double-digit top line growth, and we look forward to seeing improved economic conditions, we will continue to work to control the things that we can and do our very best for the company’s shareholders," Bauer continued. "We have some popular new products with significant revenue growth potential over the next several years, such as auto-dimming mirrors with SmartBeam and rear camera displays, which are helping Gentex to continue to be the industry leader in these areas. We remain excited about our company and the prospects for the future."
Total auto-dimming mirror unit shipments for the second quarter of 2008 increased by 1 percent over the second quarter of 2007, and automotive revenues increased by 5 percent. The primary reasons for the lower growth rate were the UAW strikes that started in the first quarter of 2008 and continued into the second quarter, reducing the company’s automotive revenues by approximately $5.8 million, and lower light vehicle production at the Detroit Three. For the current quarter, unit shipments in North America decreased by 13 percent compared with the second quarter of 2007, primarily as a result of lower light vehicle production at the Detroit Three and the continuation of the UAW strikes. Increased unit shipments to Asian and European transplants partially offset those two negative factors. Increased penetration of interior and exterior auto-dimming mirrors at certain of the company’s European and Asian automotive customers was the primary factor in achieving a 12 percent increase in offshore auto-dimming mirror unit shipments.
