Superior Industries International, Inc. (SUP - Free Report) incurred adjusted third-quarter 2019 loss of 8 cents, narrower than the Zacks Consensus Estimate of 19 cents. The lower-than-expected loss can be attributed to higher-than-expected shipments and revenues in European markets. The loss per share also narrowed year over year by 175%.
The aluminum-wheel manufacturer reported revenues of $352 million, beating the Zacks Consensus Estimate of $336 million. However, the top line was higher than the year-ago figure of $347.6 million.
Quarter Details
During the third quarter, the company’s wheel unit shipments increased 2% year over year to 4.9 million. Higher shipments in Europe, were partly offset by lower volumes in North America amid a 40-day long strike between UAW and General Motors (GM - Free Report) . Shipments in Europe came in at 2.3 million, increasing from 2 million recorded in the third quarter of 2018. The figure also outpaced the Zacks Consensus Estimate of 2.2 million.
Sales in the European market came in at $164 million, higher than $149.8 million recorded in the year-ago quarter, and topped the Zacks Consensus Estimate $160 million. The increase was driven by improved product mix and higher volumes, partially offset by weaker euro. Sales in the North American market totaled $188 million, down from $197.8 million in the third quarter of 2018.
The company’s operating profit declined from $7.7 million to $0.2 million in the quarter under review amid restructuring costs of $13 million related to the Fayetteville facility. Selling, general and administrative expenses inched up to $16.3 million from $16 million in the year-ago quarter.
Net cash provided by operating activities totaled $32.7 million in the third quarter, down from $33.5 million in the year-ago quarter. Capital expenditure amounted to $18.9 million.
During the quarter, Superior Industries suspended its quarterly dividend in a bid to reduce net debt and reinvest in business. As of Sep 30, the company’s net debt was $709 million, representing debt-to-capital ratio of 68.4%.
2019 Outlook Revised
Superior Industries projects unit shipments in the band of 19.5-19.7 million compared with the prior guidance of 19.5-19.9 million. Net sales is projected to lie between $1.39 million and $1.42 million compared with the prior range of $1.39-$1.44 billion. Cash flow from operations is projected at $135-$155 million, up from the previous guided range of $125-$145 million. Capex forecast is kept intact at $75 million.
Zacks Rank and Key Picks
Superior Industries currently carries a Zacks Rank #3 (Hold). Better-ranked players in the same industry include Spartan Motors, Inc. and BRP Inc. (DOOO - Free Report) . While Spartan sports a Zacks Rank #1 (Strong Buy), BRP carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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Superior Industries International, Inc. (SUP - Free Report) incurred adjusted third-quarter 2019 loss of 8 cents, narrower than the Zacks Consensus Estimate of 19 cents. The lower-than-expected loss can be attributed to higher-than-expected shipments and revenues in European markets. The loss per share also narrowed year over year by 175%.
The aluminum-wheel manufacturer reported revenues of $352 million, beating the Zacks Consensus Estimate of $336 million. However, the top line was higher than the year-ago figure of $347.6 million.
Quarter Details
During the third quarter, the company’s wheel unit shipments increased 2% year over year to 4.9 million. Higher shipments in Europe, were partly offset by lower volumes in North America amid a 40-day long strike between UAW and General Motors (GM - Free Report) . Shipments in Europe came in at 2.3 million, increasing from 2 million recorded in the third quarter of 2018. The figure also outpaced the Zacks Consensus Estimate of 2.2 million.
Sales in the European market came in at $164 million, higher than $149.8 million recorded in the year-ago quarter, and topped the Zacks Consensus Estimate $160 million. The increase was driven by improved product mix and higher volumes, partially offset by weaker euro. Sales in the North American market totaled $188 million, down from $197.8 million in the third quarter of 2018.
The company’s operating profit declined from $7.7 million to $0.2 million in the quarter under review amid restructuring costs of $13 million related to the Fayetteville facility. Selling, general and administrative expenses inched up to $16.3 million from $16 million in the year-ago quarter.
Net cash provided by operating activities totaled $32.7 million in the third quarter, down from $33.5 million in the year-ago quarter. Capital expenditure amounted to $18.9 million.
During the quarter, Superior Industries suspended its quarterly dividend in a bid to reduce net debt and reinvest in business. As of Sep 30, the company’s net debt was $709 million, representing debt-to-capital ratio of 68.4%.
2019 Outlook Revised
Superior Industries projects unit shipments in the band of 19.5-19.7 million compared with the prior guidance of 19.5-19.9 million. Net sales is projected to lie between $1.39 million and $1.42 million compared with the prior range of $1.39-$1.44 billion. Cash flow from operations is projected at $135-$155 million, up from the previous guided range of $125-$145 million. Capex forecast is kept intact at $75 million.
Zacks Rank and Key Picks
Superior Industries currently carries a Zacks Rank #3 (Hold). Better-ranked players in the same industry include Spartan Motors, Inc. and BRP Inc. (DOOO - Free Report) . While Spartan sports a Zacks Rank #1 (Strong Buy), BRP carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.5% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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