Gentex Corporation Business Report FY ended Dec. 2019

Financial Overview

(in million USD)

	FY ended Dec. 31, 2019	FY ended Dec. 31, 2018	Rate of change (%)	Factors
Sales	1,858.9	1,834.1	1.4	1)
Operating Income	488.5	508.1	(3.9)	-

Factors
1) Net Sales
-In 2019, Company net sales increased by 1.4% compared to the prior year. Net sales for 2019 were negatively impacted by: lower than forecasted global vehicle production rates for calendar year 2019, which were down 6% on a a year over year basis; and by approximately 1% from the strike at General Motors which occurred in the fourth quarter of 2019. Despite these negative impacts,automotive net sales increased as a result of a 3% increase in automatic-dimming mirror shipments, from 41.6 million units in 2018 to 42.9 million units in 2019, due more so to growth within the Company's domestic market than its international markets. North American automotive mirror shipments increased 8% in 2019 when compared with the prior year, primarily due to increased penetration of exterior automatic dimming mirrors.

Outlook

-The Company expects that its sales in the fiscal year ending December 31, 2020 will be between USD 1.91 billion and USD 2.0 billion.

R&D Expenditure

(in million USD)

	FY ended Dec. 31, 2019	FY ended Dec. 31, 2018	FY ended Dec. 31, 2017
Total	114.7	107.1	99.7
% of sales	6.2	5.8	5.6

Product Development

Exhibits at CES 2020
-The Company will demonstrate a host of new features and technology concepts at CES 2020 that dramatically expand its digital vision, car connectivity and sensing, and dimmable glass product lines. This year at CES, the Company is demonstrating an all-new full display mirror (FDM) that features touch-screen adjustment, an active illumination concept that uses rearward-facing infrared emitters to illuminate the FDM’s rearward view, and lane-line projection concept, which overlays the rearward scene with digitally generated lane lines. It will demonstrate a hybrid camera monitoring system (CMS) that integrates the side-view cameras into the vehicle’s exterior mirrors, and fully digital CMS, which replaces exterior mirrors with side-view camera pods and curved interior OLED displays. It is also showcasing a mirror-integrated digital video recorder (DVR) capable of recording from forward- and rearward-facing cameras. New for this year’s automotive glass displays are dimmable side windows, fully-integrated dimmable windscreen visors, and a unique pillar display. It will also demonstrate HomeLink Connect, which allows drivers to operate home automation devices from a touch screen, and Integrated Toll Module (ITM), a nationwide toll collection technology. It will also debut a developmental in-cabin sensing unit that detects smoke, vape, VOCs and other airborne contaminants in the vehicle. (From a press release on January 6, 2020)

Rear view system for Aston Martin
-On January 2, the Company and Aston Martin announced that they’ve jointly developed a camera-based rear vision system for future Aston Martin vehicles. Integrated into an Aston Martin DBS Superleggera for demonstration, the first prototype of the system will be displayed in its booth at the CES 2020. The hybrid camera monitoring system (CMS) uses three cameras to provide a comprehensive view of the sides and rear of the vehicle. Side-view cameras are discretely housed in each of the vehicle’s exterior mirrors; their video feeds are combined with that of a roof-mounted camera and displayed together in multiple composite views that are streamed to the driver via a rear-view mirror-integrated display inside the cockpit. The Company and Aston Martin collaboration is part of an ongoing development program to bring CMS to future Aston Martin vehicles. For the current prototype, Aston Martin provided overall styling and engineering direction; the Company integrated the system’s cameras, image processing software, and mirror-integrated display; and it partnered with exterior mirror supplier Lumatech to engineer the exterior mirrors. The Company recently began shipping its Full Display Mirror (FDM) for use in the 2020 Aston Martin DBS GT Zagato.