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  5. Tower International, Inc. Business Report FY ended Dec. 2014

Tower International, Inc. Business Report FY ended Dec. 2014

Financial Overview

(in million USD)
FY ended Dec. 31, 2014 FY ended Dec. 31, 2013 Rate of change (%) Factors
Net Sales 2,067.8 1,966.5 5.2 1)
Operating Income 80.8 73.5 9.9 -


Factors
1) Net Sales
-Total revenues increased during the year ended December 31, 2014 by USD 101.3 million, or 5.2%, from the year ended December 31, 2013, reflecting primarily higher volume in the Americas segment (USD 79.5 million) and in the International segment (USD 48.3 million). Revenues were positively impacted by the strengthening of the Euro against the U.S. dollar in the International segment (USD 1.8 million), but were negatively impacted by the strengthening of the U.S. dollar against the Brazilian Real (USD 17.3 million) in the Americas segment and the Chinese RMB (USD 0.2 million) in the International segment. Revenues were also adversely impacted by unfavorable pricing (USD 10.8 million).

Operations in China

-As of December 31, 2014, the Company had four joint ventures in China. Of the four joint ventures; one is consolidated, one is accounted for as an equity method investment, and two are presented as discontinued operations.

-During the fourth quarter of 2014, the Board of Directors approved a plan to sell its equity interest in the following three joint ventures.
1) Changchun Tower Golden Ring Automotive Products Co., Ltd. (TGR)
The Company has reached a preliminary agreement to sell its 60% equity interest in the TGR joint venture, subject to approval of the Chinese government; the sale is expected to close during the second half of 2015.
2) Xiangtan DIT Automotive Products Co., Ltd. (Xiangtan)
The Company is in the early stages of discussions to sell its 51% equity interest in the Xiangtan joint venture.
3) Ningbo DIT Automotive Products Co. Ltd. (Ningbo)
The investment in the Ningbo joint venture is accounted for under the equity method and therefore does not qualify for held for sale treatment. The financial results of Ningbo are not consolidated within the Company's financial statements for the quarterly periods beginning after the first quarter of 2013.

Contracts

OEM Models Product Type
North America
Ford Econoline Frame Assembly
Explorer Complex Assembly
Expedition/Navigator Body Structures
F-Series Body Structures
Focus Body Structures
Taurus/MKS Complex Assembly
Escape Body Structures & Complex Assembly
C-Max Body Structures
Chrysler Grand Caravan/Town & Country Body Structures
Grand Cherokee/Durango Body Structures
Wrangler Frame Assembly
Dart Body Structures
200 Body Structures
Cherokee Body Structures
Nissan Frontier/Xterra Body Structures & Frame Assembly
NV Series Frame Assembly
Titan/Armada Frame Assembly
Altima Body Structures
Rogue Body Structures
Toyota Camry Body Structures
Tacoma Body Structures
Honda Accord Body Structures
Europe
Volvo V40/S60/XC60 Complex Assembly
VW Touareg/Q7 Body Structures & Complex Assembly
Caddy Van Body Structures
Citigo/Mii/Up! Body Structures
Octavia Body Structures
Superb Body Structures
Fabia Body Structures
Porsche Macan Body Structures
Cayenne Body Structures & Complex Assembly
BMW 1 Series/3 Series Body Structures
Daimler Sprinter/Crafter Body Structures & Complex Assembly
C-Class Body Structures
Fiat 500 Body Structures
Ducato Body Structures
Giuletta Body Structures
MiTo Body Structures
Punto Body Structures
Renegade Body Structures
Opel Astra Body Structures
China
Chery A3 Chassis
Cowin 3 Chassis
Fulwin 2 Chassis
Tiggo Chassis
South America
VW Gol Body Structures
Fox Body Structures
Saveiro Body Structures
Up! Body Structures
Fiat Palio/Doblo Body Structures
Punto Body Structures
Strada Body Structures
Honda Civic Body Structures
Fit Body Structures
City Body Structures
PSA Picasso Body Structures

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

Capital Expenditure

(in million USD)
FY ended Dec. 31, 2014 FY ended Dec. 31, 2013 FY ended Dec. 31, 2012
Overall 98.4 78.0 92.3


-Capital expenditures for the years ended December 31, 2014 and 2013 were USD 98.4 million and USD 78 million, respectively. The increase reflects primarily an opportunistic conquest award and growth opportunities in Mexico.

-The capital spending for 2015 is expected to be approximately USD 80 million.