Superior Industries International, Inc. Business Report FY ended Dec. 2013

Business Highlights

Financial Overview

(in million USD)
  FY ended Dec. 31, 2013 FY ended Dec. 31, 2012 Rate of change
(%)
Factors
Net Sales 789.6 821.5 (3.9) 1)
Operating Income 34.6 32.9 5.2 2)

Factors

1) Net Sales
-Net sales in 2013 decreased USD 31.9 million to USD 789.6 million from USD 821.5 million in 2012. Wheel sales in 2013 decreased USD 32.9 million to USD 779.5 million from USD 812.4 million in 2012. Wheel shipments decreased by 5 percent compared to 2012 with the lower volume resulting in USD 37.5 million lower sales compared to 2012. Net sales were unfavorably impacted by a decline in the value of the aluminum component of sales which the Company generally passes through to the customers and resulted in USD 12.8 million lower revenues.

-Decreases in unit shipments to Nissan, GM, Chrysler, Subaru, BMW, Mitsubishi and VW were partially offset by increases in unit shipments to Ford, Toyota, Tesla and Mazda. Wheel program development revenues totaled USD 10.1 million in 2013 and USD 9.1 million in 2012.

2) Operating Income
-Consolidated income from operations increased USD 1.7 million in 2013 to USD 34.6 million, or 4 percent of net sales, from USD 32.9 million, or 4 percent of net sales, in 2012. Income from U.S. operations increased USD 5.3 million, while income from Mexico operations decreased USD 2.9 million when comparing 2013 to 2012.

Contracts

-At the customer level, shipments in 2013 to Ford increased 9 percent compared to last year, as shipments of light-duty truck wheels increased 11 percent and passenger car wheels increased 1 percent. At the program level, the major unit shipment increases were for;
  • F-Series trucks
  • Lincoln MKZ
  • Explorer
  • Edge
  • Fiesta
  • Flex
with shipment decreases for;
  • Fusion
  • Mustang
-Shipments to GM in 2013 decreased 11 percent compared to 2012, as unit volume of passenger car wheels decreased 57 percent and light-duty truck wheel shipments decreased 1 percent. The major unit shipment decreases to GM were for;
  • Chevrolet Malibu
  • Impala and
  • Traverse
  • Cadillac SRX
which were partially offset by major unit shipment increases for;
  • Chevrolet Enclave
  • Cadillac ATS
-Shipments to Toyota in 2013 increased 21 percent compared to last year, as shipments of passenger car wheels increased 61 percent and light-duty truck wheels increased 5 percent.The major unit shipment increases to Toyota were for;
  • Avalon
  • Sienna
-Shipments to Chrysler in 2013 decreased 17 percent compared to last year, as unit volume of light-duty truck wheels decreased 19 percent and passenger car wheel shipments increased 7 percent. The major unit shipment decreases to Chrysler were for;
  • Jeep Grand Cherokee
  • Dodge Journey
  • Jeep Compass
  • Dodge Caravan, and
  • Jeep Liberty
which were partially offset by major unit
shipment increases for;
  • Dodge Ram
  • Durango
  • Challenger.
-Shipments to international customers, excluding Toyota, in 2013 decreased 33 percent compared to 2012, as shipments of passenger car wheels decreased 38 percent and shipments of light-duty truck wheels decreased 20 percent. Unit shipments decreased to each of our international customers except Toyota and Mazda when compared to last year. The lower unit volumes included decreases of 41 percent to Nissan, 28 percent to Subaru, 14 percent to BMW and 98 percent to Mitsubishi along with smaller decreases to VW and Isuzu. At the program level, major unit shipment decreases to international customers were for Nissan's Sentra, Maxima, Altima and Versa, Subaru's Outback, BMW's X3 and Mitsubishi's Galant, offset by major unit shipment increases for the Nissan Note.

R&D

R&D Expenditure

(in million USD)
  FY ended Dec. 31, 2013 FY ended Dec. 31, 2012 FY ended Dec. 31, 2011
Total 4.8 5.8 5.3

R&D Facilities

-The Company has technical centers located in Fayetteville, Arkansas and Detroit, Michigan.

Investment Activities

Investment Outside USA

<Mexico>
-The Company announced it has selected the city of Chihuahua as the site where it will build a new manufacturing facility in Mexico. Superior previously announced that it intends to invest approximately USD 125 million to USD 135 million to construct and equip the new manufacturing facility, which will have an initial capacity to produce between 2 million and 2.5 million wheels a year. The Company currently produces approximately 12.5 million wheels annually. Groundbreaking is targeted for around the middle of 2013 and completion of construction anticipated about two years later. Superior currently has three manufacturing facilities in the city of Chihuahua. (From a press release on April 16, 2013)