Visteon Corporation reported second quarter financial results, with sales of $848 million, up 42% (excluding the year-over-year impact of currency fluctuations) from the prior year, which it said was driven by new product launches and positive pricing due to incremental costs recoveries related to semiconductor shortages.
Other highlights include:
- 13th consecutive quarter of growth-over-market 1
- Net income of $24 million
- Adjusted EBITDA of $79 million or 9.3% of sales
- 27 new products launched in first half
- $3.1 billion in new business wins in first half
- Refinanced credit agreement and extended debt maturity to 2027
Visteon said total industry production was flat while vehicle production at its top customers increased 6% in the same period. The company’s sales performance represents 36%1 growth-over-market, the 13th consecutive quarter of market out-performance.
Gross margin in the second quarter was $74 million, and net income attributable to Visteon was $24 million or $0.85 per diluted share. Adjusted EBITDA, a non-GAAP measure as defined below, was $79 million for the second quarter or 9.3% of sales, an increase of $49 million compared to the prior year. The increase in adjusted EBITDA reflects the favorable impact of higher sales volumes and increased customer cost recoveries net of higher semiconductor costs.
For the first six months, Visteon said cash used by operations was $72 million and capital expenditures were $36 million. Adjusted free cash flow, a non-GAAP financial measure as defined below, for the first six months of 2022 was a use of cash of $99 million primarily driven by an outflow in working capital related to the timing of customer recoveries and higher inventory levels due to uneven supply of semiconductors. The company ended the second quarter with cash of $325 million and debt of $349 million.
New Business Wins and Product Launch Highlights
Visteon announced it launched 11 new products in the second quarter bringing the first half total to 27 new launches. Key second quarter launches include a 12-inch all-digital cluster for the Ford Everest and Ranger and a curved multi-display module on the Maserati Grecale, the all-new flagship crossover SUV for Maserati. The company also launched a SmartCore™ cockpit domain controller with Geely on its new all-electric SUV under the Smart Brand as well as a 10.25-inch infotainment system and display on PSA’s Citroen C3 supporting Apple CarPlay and Android Auto in the South American market.
Visteon also reported it won $3.1 billion of new business through the first half of the year, with more than 50% of programs on electric vehicle variants. The company said second-quarter wins included its latest-generation SmartCore™ cockpit domain controller on an all-electric SUV platform for a European OEM, its first cockpit domain controller with this automaker. Visteon also said it won a 12-inch display for a luxury German OEM, also its first center information display win with this OEM.
“I am proud of Visteon’s double-digit growth-over-market performance in an environment of constrained supply exacerbated by the lockdown in Shanghai due to COVID-19,” said president and CEO Sachin Lawande. “The Visteon team performed exceptionally well to secure supply and support our customers’ production in this challenging environment. Our digital products continue to do well and we are happy to report another strong quarter of new business wins with over $2 billion in lifetime revenue.”
Visteon said it is maintaining full-year 2022 guidance and anticipates sales in the range of $3.150 – $3.350 billion, Adjusted EBITDA in the range of $295 – $335 million, and Adjusted Free Cash Flow in the range of $85 – $115 million.
1 Visteon Y/Y sales growth (ex. FX) compared to production for Visteon customers weighted on Visteon sales contribution