[Gen-AI Analysis] Tower International, Inc. Business Report FY ended 2012 - MarkLines Automotive Information & Gen-AI Platform

Tower International, Inc. Business Report FY ended Dec. 2012

Business Highlights

Financial Overview

(in million USD)

	FY ended Dec. 31, 2012	FY ended Dec. 31, 2011	Rate of change (%)	Factors
Net Sales	2,084.9	2,053.7	1.5	1)
Operating Income	64.3	43.0	49.5	-

Factors
1) Net Sales
-Total revenues increased during the year ended December 31, 2012 by USD 31.2 million or 1.5% from the year ended December 31, 2011, reflecting primarily higher volume in both the Americas segment (USD 113.9 million) and the International segment (USD 33 million). Sales were positively impacted by the strengthening of the Chinese RMB against the US dollar (USD 4.4 million), but were negatively impacted by the strengthening of the US dollar against foreign currencies in the International segment, primarily the Euro (USD 62.2 million), and in the Americas segment, primarily the Brazilian Real (USD 36 million). Revenues were also negatively impacted by unfavorable pricing (USD 21.9 million).

Divestitures

-In December 2012, the Company announced that it sold its Korean operations in order to strengthen its overall business and realize shareholder value. Under the agreement reached earlier, the Company sold 100% of the stock in its wholly-owned Korean subsidiary to SECO, a privately owned Korean auto parts supplier. The Company will receive an estimated USD 47 million in cash for the transaction. The sold operations include 5 manufacturing plants, a tooling plant, and a headquarters/technical center. Financial results for full year 2012 of the Korean operations were projected at revenue of USD 345 million, adjusted EBITDA of USD 25 million, and free cash flow of negative USD 5 million. (From a press release on December 28, 2012)

R&D

-The Company has a total of nine technical centers located in the following countries: United States, Brazil, Germany, Italy, China (3), India, and Japan.

Investment Activities

Capital Expenditure

(in million USD)

	FY ended Dec. 31, 2012	FY ended Dec. 31, 2011	FY ended Dec. 31, 2010
Overall	119.8	100.8	100.5

Investment Activities

-Capital expenditures for the years ended December 31, 2012 and 2011 were USD 119.8 million and USD 100.8 million, respectively, the increase reflecting primarily the expansion in China and the timing of program launches. The Company's capital spending for 2013 is expected to be approximately USD 85 million to 90 million.