Stoneridge Improves but Misses Ests

Stoneridge Inc. (SRI - Snapshot Report) posted a more than 50% rise in profit to $2.9 million or 12 cents per share in the first quarter of the year from $1.9 million or 8 cents per share in the same quarter in the previous year. However, the company missed the Zacks Consensus Estimate by 5 cents per share.

The higher profit was attributable to increased production volume, partially offset by operational inefficiencies, higher commodity costs and unfavorable foreign exchange rates.

Sales in the quarter surged 30% to $193.0 million, exceeding the Zacks Consensus Estimate of $168 million. The improvement in sales was driven by increase in vehicle production volume of 15.6% in the North American passenger car and light truck markets, and 39.7% and 66% in the commercial vehicle markets of North America and Europe, respectively.

Stoneridge had cash and cash equivalents of $53.2 million as of March 31, 2011, down from $72.0 million as of December 31, 2010. Long-term debt remained almost flat at $168.1 million as of March 31, 2011 compared with $167.9 million as of December 31, 2010. Consequently, long-term debt-to-capitalization ratio remained almost unchanged at 64% compared with 66% as of December 31, 2010.

During the quarter, Stoneridge’s cash flow use from operations deteriorated to $15.5 million from $7.3 million a year ago. Meanwhile, capital expenditures (net) increased to $4.3 million from $3.6 million in the first quarter of 2010.

Stoneridge, a Zacks #3 Rank (Hold) stock, designs and manufactures engineered electrical and electronic components, modules, and systems for the medium and heavy-duty truck, agricultural, automotive, and off-highway vehicle markets primarily in North America and Europe.

The company has upgraded its 2011 sales guidance to $750 million–$775 million from $720 million–$750 million based on improved fundamentals in the commercial vehicle, agricultural/off highway and automotive markets.

Read the full analyst report on SRI