Linamar Delivers Another Excellent Quarter of Double Digit Top and Bottom Line Growth and Continued Cash Generation

GUELPH, ON, Nov. 4, 2015 /CNW/ - (TSX: LNR)

  • Sales increase 24.8% and operating earnings increase 31.3% over the third quarter of 2014 ("Q3 2014");
  • Net earnings up 35.5% and earnings per share up 34.1% over Q3 2014 reaching $107.6 million and $1.65 respectively;
  • Continued business wins drive launch book to more than $3.7 billion;
  • Industrial segment delivers excellent sales and operating earnings growth from Q3 2014 with operating earnings up 34.7% to $36.9 million on a sales increase of 24.8%;
  • Powertrain/Driveline delivers excellent sales and operating earnings growth as well with operating earnings up 30.2% to $107.3 million from Q3 2014 on a sales increase of 24.8%; and
  • Content per vehicle growth in every market and market share growth on booms and scissors.

Three Months Ended

Nine Months Ended


September 30

September 30


2015

2014

2015

2014

(in millions of dollars, except earnings per share figures)

$

$

$

$

Sales

1,273.9

1,020.7

3,919.5

3,168.6

Operating Earnings (Loss)






Powertrain/Driveline

107.3

82.4

329.7

250.5


Industrial

36.9

27.4

135.9

95.7

Operating Earnings (Loss)

144.2

109.8

465.6

346.2

Net Earnings (Loss)

107.6

79.4

341.4

248.8

Net Earnings (Loss) per Share

1.65

1.23

5.24

3.84

Operating Highlights
Sales for the third quarter of 2015 ("Q3 2015") were $1,273.9 million, up $253.2 million from $1,020.7 million in Q3 2014.

Sales for the Powertrain/Driveline segment ("Powertrain/Driveline") increased by $211.4 million, or 24.8% in Q3 2015 compared with Q3 2014.  The sales increase in Q3 2015 was impacted by:

  • the acquisition of our new forging businesses in Europe and North America in Q1 2015 and Q4 2014 respectively;
  • higher sales resulting from favourable changes in foreign exchange rates; and
  • significant levels of newly launched programs in North America and Europe;  partially offset by
  • market declines in the Off Highway commercial vehicles in North America, Asia and Europe.

The Industrial segment ("Industrial") product sales increased 24.8% or $41.8 million to $210.2 million in Q3 2015 from Q3 2014.  The sales increase was due to:

  • higher sales resulting from favourable changes in foreign exchange rates;
  • market share growth for booms in North America and Europe; and
  • market share growth for telehandlers in North America.

The company's operating earnings for Q3 2015 were $144.2 million.  This compares to $109.8 million in Q3 2014, an increase of $34.4 million.

Q3 2015 operating earnings for Powertrain/Driveline were higher by $24.9 million or 30.2% over Q3 2014.  The Powertrain/Driveline segment experienced the following in Q3 2015:

  • improved earnings as production volumes increased on launching programs;
  • higher earnings as a result of a favourable sales mix to higher margin programs;
  • higher earnings resulting from favourable changes in foreign exchange rates across multiple currencies and our growing global presence; and
  • earnings related to the acquisition of our new forging businesses; partially offset by
  • lower earnings related to reductions on Off Highway commercial vehicles;
  • costs associated with 3 facility relocations to enhance growth, maximize operating efficiencies and minimize logistics costs; and
  • increased management and sales costs supporting growth.

Industrial segment operating earnings in Q3 2015 increased $9.5 million or 34.7% over Q3 2014. The increase in Industrial operating earnings was predominantly driven by:

  • higher margins resulting from favourable changes in foreign exchange rates; and
  • increased market share growth in the booms and telehandlers; partially offset by
  • lower earnings due to a less favourable customer and product mix of the units sold in the quarter;
  • higher than the normal level of trade-in allowances that occurred in the quarter; and
  • increased management and sales costs supporting growth.

"We are very pleased with another excellent quarter of double digit growth at Linamar," said Linamar CEO Linda Hasenfratz.  "Financially we again saw strong, industry leading top and bottom line growth, setting us up for another record year. Strategically, we made a big move this quarter with our announcement regarding our intent to bid for the shares of Montupet, an important part of our light metal casting strategy, designed to significantly enhance our cylinder head market share and set us up for excellent growth in the engine segment.  We are excited by what our team is achieving and what the future holds."

Dividends
The Board of Directors today declared an eligible dividend in respect to the quarter ended September 30, 2015 of CDN$0.10 per share on the common shares of the company, payable on or after December 11, 2015 to shareholders of record on November 26, 2015.

Forward Looking Information, Risk and Uncertainties

Linamar no longer provides a financial outlook.

Certain information provided by Linamar in this MD&A, the unaudited interim financial statements and other documents published throughout the year which are not recitation of historical facts may constitute forward-looking statements. The words "may", "would", "could", "will", "likely", "estimate", "believe", "expect", "plan", "forecast" and similar expressions are intended to identify forward-looking statements. Readers are cautioned that such statements are only predictions and the actual events or results may differ materially. In evaluating such forward-looking statements, readers should specifically consider the various factors that could cause actual events or results to differ materially from those indicated by such forward-looking statements.

Such forward-looking information may involve important risks and uncertainties that could materially alter results in the future from those expressed or implied in any forward-looking statements made by, or on behalf of, Linamar. Some of the factors and risks and uncertainties that cause results to differ from current expectations include, but are not limited to, changes in the various economies in which Linamar operates, fluctuations in interest rates, environmental emission and safety regulations, the extent of OEM outsourcing, industry cyclicality, trade and labour disruptions, world political events, pricing concessions and cost absorptions, delays in program launches, the Company's dependence on certain engine and transmission programs and major OEM customers, currency exposure, technological developments by Linamar's competitors, governmental, environmental and regulatory policies and changes in the competitive environment in which Linamar operates.

The foregoing is not an exhaustive list of the factors that may affect Linamar's forwarding looking statements. These and other factors should be considered carefully and readers should not place undue reliance on Linamar's forward-looking statements. Linamar assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.

Conference Call Information

Q3 2015 Conference Call Information
Linamar will hold a conference call on November 4, 2015 at 5:00 p.m. EST to discuss its third quarter results.  The numbers for this call are (647) 427-3383 (local/overseas) or (888) 424-9894 (North America) confirmation number 12325574, with a call-in required 10 minutes prior to the start of the conference call. The conference call will be chaired by Linda Hasenfratz, Linamar's Chief Executive Officer. A copy of the company's quarterly financial statements, including the Management's Discussion & Analysis will be available on the company's website after 4 p.m. EST on November 4, 2015 and at www.sedar.com by the start of business on Novmeber 5, 2015. A taped replay of the conference call will also be made available starting at 7:45 p.m. on November 4, 2015 for ten days.  The number for replay is (855) 859-2056, Conference ID 12325574.  The conference call can also be accessed by web cast at www.linamar.com, by accessing the investor relations/events menu.

Audio only streaming of the conference call available at http://www.media-server.com/m/p/kqge7s7i

Q4 2015 Conference Call Information
Linamar will hold a conference call on March 9, 2016 at 5:00 p.m. EST to discuss its fourth quarter/year end results. The numbers for this call are (647) 427-3383 (local/overseas) or (888) 424-9894 (North America) confirmation number 68602541, with a call-in required 10 minutes prior to the start of the conference call. The conference call will be chaired by Linda Hasenfratz, Linamar's Chief Executive Officer. A copy of the company's quarterly financial statements, including the Management's Discussion & Analysis will be available on the company's website after 4 p.m. EST on November 4, 2015 and at www.sedar.com by the start of business on March 9, 2016.  A taped replay of the conference call will also be made available starting at 7:45 p.m. on March 9, 2016 for ten days.  The number for replay is (855) 859-2056, Conference ID 12325574.  The conference call can also be accessed by web cast at www.linamar.com, by accessing the investor relations/events menu.

Audio only streaming of the conference call available at http://www.icastpro.ca/lin160309

Linamar Corporation (TSX:LNR) is a diversified global manufacturing Company of highly engineered products powering vehicles, motion, work and lives. The Company is made up of 2 operating segments – the Powertrain/Driveline segment and the Industrial segment, which are further divided into 4 operating groups – Machining & Assembly, Light Metal Casting, Forging and Skyjack, all world leaders in the design, development and production of highly engineered products.  The Company's Machining and Assembly, Casting and Forging operating groups focus on precision metallic components, modules and systems for engine, transmission and driveline systems and structural components designed for global vehicle and industrial markets. The Company's Skyjack operating group is noted for its innovative, high quality mobile industrial equipment, notably its class-leading aerial work platforms and telehandlers. With more than 19,500 employees in 48 manufacturing locations, 5 R&D centers and 15 sales offices in 14 countries in North and South America, Europe and Asia, Linamar generated sales of $4.2 billion in 2014. For more information about Linamar Corporation and its industry leading products and services, visit www.linamar.com.

Guelph, Ontario

November 4, 2015

SOURCE Linamar Corporation

For further information: regarding this release please contact Linda Hasenfratz at (519) 836-7550.

RELATED LINKS
http://www.linamar.com

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