VAN BUREN TOWNSHIP, Mich. — Visteon Corp. is providing preliminary estimates of certain financial information for the fourth quarter and full year 2008, along with an update on restructuring and other business actions. Visteon expects to release its final fourth-quarter and full-year 2008 financial results on Feb. 25.
Product sales for fourth quarter 2008 are estimated to be $1.55 billion, while full year 2008 sales are estimated at $9.1 billion. Approximately 22 percent of total fourth quarter product sales were in North America, with 37 percent in Europe and 35 percent in Asia-Pacific. The reduction in fourth quarter sales compared with a year ago is largely attributable to significantly lower vehicle production by Visteon’s global customers, the company said.
Visteon said it continues to win new business with a broad spectrum of customers across all regions. New business wins in 2008 were about $650 million.
Visteon’s year-end 2008 cash balances were $1.18 billion, which include $75 million drawn under the company’s principal U.S. credit line. Visteon’s debt balances at year-end 2008 were approximately $2.76 billion and include $92 million for the non-cash impact of on-balance sheet accounting treatment for the Europe securitization facility, which was amended in fourth quarter 2008.
Restructuring and Other Actions
Visteon also announced that it has completed its three-year improvement plan at a lower cost and with greater savings than originally planned. Recent actions taken at two Western European manufacturing locations bring the total number of facilities addressed to 30. As of Dec. 31, 2008, $68 million was available in the escrow account to fund future restructuring actions.
Visteon said continues to take other aggressive actions in light of the current vehicle production environment. The company reduced its workforce by 800 employees globally by the end of first quarter 2009, which will generate an estimated per annum savings of $60 million once completed. In addition, for the month of January 2009, Visteon adopted a four-day workweek schedule for about 2,000 salaried employees at its Van Buren Township and Plymouth, Mich., facilities commensurate with a 20 percent reduction in base salaries. This action will be reassessed based on future market conditions. The company also has implemented other actions to reduce costs, including the suspension of 401(k) matching contributions and 2009 salary increases, the elimination of certain benefit programs and a reduction in new hiring. Additional actions are being taken to reduce capital expenditures, working capital and non-personnel expenses.