Stoneridge, Inc. Business Report up until FY ended Dec. 2014

Recent Years

Business Overview

(in million USD)

	FY ended Dec. 31, 2014	FY ended Dec. 31, 2013	Rate of change (%)	Factors
Overall
Net Sales	660.6	659.5	0.2	1)
Operating Income	(25.8)	42.4	-	2)
Sales by Division
Control Devices	309.7	294.0	5.3	3)
Electronics	249.3	230.9	8.0	4)
PST	139.8	178.5	(21.7)	5)

Factors
1) Net Sales
-The Company's net sales grew 0.2% in 2014 to USD 660.6 million. The increase in sales was primarily due to higher sales in the Electronics and Control Devices segments which were substantially offset by lower product sales volume and unfavorable foreign currency translation at the PST segment.

2) Operating Income
-The Company posted an operating loss of USD 25.8 million in 2014 mainly due to a goodwill impairment charge of USD 51.5 million related to the PST segment.

3) Control Devices
-In 2014, net sales in the Control Devices segment increased 5.3% to USD 309.7 million due to higher volume primarily in our North American automotive and commercial vehicle markets.

4) Electronics
-Net sales for the Electronics segment increased 8.0% to USD 249.3 million in 2014 primarily due to higher sales of its European and North American commercial vehicle products. This was a result of higher volume including post-disposition sales to the Wiring business acquired by Motherson and new product sales for 2014.

5) PST
-Sales from the PST segment dropped 21.7% to USD 139.8 million due to lower product volume in its OEM, audio and aftermarket channels resulting from weakness in the Brazilian economy and automotive market as well as an unfavorable change in foreign currency translation.

Divestitute

-In August 2014, the Company completed the sale of its Wiring Business assets to Motherson Sumi Systems Ltd. for a price of USD 65.7 million. Included in the transaction are six manufacturing facilities located in Portland, Indiana, U.S.; Chihuahua, Mexico; Saltillo, Mexico; and Monclova, Mexico; as well as an engineering and administrative center located in Warren, Ohio, U.S. The Wiring Business designs and manufactures wiring harness products for sale principally to the commercial, agricultural and off-highway vehicle markets, as well as assembles entire instrument panels that are configured specifically to an OEM customer's specifications in the commercial vehicle market. (From a press release on August 1, 2014)

Award

-In 2014, the Company received the New Consumer Focused Technology award from Ford Motor Company at its World Excellence Awards event for implementing new shift-by-wire technology. (From a press release on June 25, 2014)

Acquisition

-In January 2012, the Company announced that it completed the acquisition of an additional 24% ownership of PST Eletronica S.A., a Brazil-based vehicle electronics joint venture focused on security and infotainment. With the transaction, the Company's ownership interest in PST increased from 50% to 74%. (From a press release on January 5, 2012)

R&D Expenditures

(in million USD)

	FY ended Dec. 31, 2014	FY ended Dec. 31, 2013	FY ended Dec. 31, 2012
Overall	41.6	40.4	38.9
As % of Net Sales	6.3%	6.1%	6.4%

R&D Structure

-Development work at the Company is largely performed on a decentralized basis. The decentralized product development operations are complimented by larger technology groups in Canton, Massachusetts, U.S.; Lexington, Ohio, U.S.; Stockholm, Sweden; Pune, India; Manaus and Sao Paulo, Brazil; Shanghai, China.

Capital Expenditures

(in million USD)

	FY ended Dec. 31, 2014	FY ended Dec. 31, 2013	FY ended Dec. 31, 2012
Control Devices	13.7	9.9	8.8
Electronics	3.5	4.7	3.4
PST	6.2	6.7	9.1
Corporate	0.1	0.3	1.6
Total	23.5	21.6	22.9

Data

	Dec. 2014	Dec. 2013	Dec. 2012
Total	4,200	9,300	8,700

Net Sales by Segment

(in million USD)

	FY ended Dec. 31, 2014	FY ended Dec. 31, 2013	FY ended Dec. 31, 2012
Control Devices	309.7	294.0	271.8
Electronics	249.3	230.9	216.1
PST	139.8	178.5	180.4
Eliminations	(38.2)	(44.0)	(55.8)
Total	660.6	659.5	612.5