Federal-Mogul Corporation (FDML), a supplier of original and aftermarket automotive products, Tuesday, reported a profit for the fourth quarter compared to a loss in the same quarter last year, reflecting much lower charges. The turnaround also reflected strong demand and higher margins.
Net income for the fourth quarter attributable to company was $43 million or $0.43 per share compared to a net loss of $530 million or $5.36 per share in the prior-year quarter.
Year-ago quarter's results include a restructuring charge of $118 million, and an adjustment of assets to fair value charge of $451 million much higher than $16 million reported for this year's fourth quarter.
The Southfield, Michigan-based company, controlled by billionaire investor Carl Icahn, posted net sales for the quarter of $1.41 billion compared to $1.32 billion in the same quarter a year ago.
Gross margin for the quarter were up 2.1 percentage points to 16% from 13.9% in the same quarter the previous year, reflecting restructuring and cost reduction initiatives largely completed during the year.
Operating profit increased $42 million to $225 million from $183 million in the last year quarter.
For the full year, net loss attributable to company narrowed to $45 million or $0.46 per share from $468 million or $4.69 per share last year. Adjusted net income for the full year, which excludes impairments and restructuring charges, reached breakeven.
Full year sales decreased $1.54 billion to $5.33 billion from $6.87 billion in the previous year, hurt mainly by the global automotive and financial market downturn. On a constant dollar basis, the company's sales for the year were down 19% or $1.2 billion.
Jose Maria Alapont, Chief Executive Officer, said, "--we are implementing strategies to increase our sales to customers in the Energy, Industrial and Transport market segments, where we generate about 9% of our total revenue today. We believe business segments like the expanding wind energy market, improving industrial markets and growth in the global supply chain will increasingly benefit Federal-Mogul, due to our specialized products to serve these segments."
FDML shares are currently trading at $15.95, up $0.19 or 1.21% on a volume of 55,998 shares on the Nasdaq.
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