Stoneridge Inc. has announced financial results for the fourth quarter and full-year ended Dec. 31, 2016, with full-year sales of $696 million and EPS of $2.74. Adjusted EPS was $1.42 for 2016, an increase of 60 cents per share, or 73 percent, compared with 2015. Sales in 2016 increased $51.2 million, or 8 percent, compared with 2015.
Fourth quarter 2016 sales were $172.6 million, an increase of 12 percent over fourth quarter 2015, with EPS of $1.70. Adjusted EPS was 34 cents, an increase of 12 cents, or 56 percent, over the fourth quarter of 2015.
For the full-year 2016 Stoneridge reported gross profit of $195.4 million (28.1 percent of sales), an improvement of approximately 65 basis points and $18.5 million, or 10 percent, over 2015. Operating income was $44.1 million (6.3 percent of sales), an improvement of approximately 200 basis points and $16.3 million, or 58 percent, over 2015. EBITDA was $68.7 million, (9.9 percent of net sales), an improvement of approximately 230 basis points, or 41 percent, over 2015.
Stoneridge released the valuation allowance on U.S. Federal, certain state and foreign deferred tax assets in the fourth quarter of 2016 based on strong recent financial performance, a high level of booked awarded business and the anticipation of continued strong performance. The impact of the release of the valuation allowance in the fourth quarter of 2016 resulted in a non-cash tax benefit of $38.8 million for the full-year (additional EPS of $1.37 for the full-year based on weighted average shares outstanding and $1.36 for the fourth quarter of 2016). The release of the valuation allowance will not have an impact on historical or near-term forecasted cash taxes to be paid.
Jon DeGaynor, president and CEO, commented, “Strong financial performance through 2016 was supported by top-line growth that exceeds our underlying markets as well as the expansion of our margin through continued operating improvement. More specifically, we are pleased with the results of our shift-by-wire ramp-up in our Control Devices segment in 2016 as well as the improvement in our PST segment, which generated positive operating profit for the second consecutive quarter and continues to operate at sustainably profitable margins.”
2017 Outlook
The company has announced 2017 sales guidance of $705 million to $730 million, compared with 2016 sales of $696 million, which suggests midpoint growth of 3.1 percent compared with 2016.
The company also announced 2017 gross margin guidance of 28 percent to 30 percent (midpoint improvement of 90 basis points compared with 2016), operating margin guidance of 6.5 percent to 7.5 percent (midpoint improvement of 70 basis points compared with 2016) and EBITDA margin guidance of 10 percent to 11.5 percent (midpoint improvement of 85 basis points compared with 2016).
DeGaynor concluded, “We are pleased our guidance provides for revenue growth amplified by continued expansion of margin. While we expect some modest headwind related to forecasted vehicle volumes, we are confident that our operational efficiency and robust backlog will translate to another successful year for Stoneridge.”
