Magna Q2 Profit Misses Estimates, Cuts Outlook On Continued Chip Shortage; Stock Down

Magna International Inc. (MGA,MG.TO) said its second-quarter sales, adjusted EBIT and earnings per share came in well below the company's expectations due to significant production disruptions as a result of the global semiconductor chip shortage. The company reduced its fiscal 2021 guidance, largely reflecting reduction in expected global light vehicle production.

Second-quarter adjusted profit per share was $1.40 compared to a loss of $1.71 per share, a year ago. On average, 18 analysts polled by Thomson Reuters expected the company to report profit per share of $1.47, for the quarter. Analysts' estimates typically exclude special items. Adjusted EBIT was $557 million compared to a loss of $600 million, last year.

Net income attributable to Magna was $424 million compared to a loss of $647 million, last year. Profit per share was $1.40, compared to a loss of $2.17.

Sales were $9.0 billion, up 110% over the second quarter of 2020, as global light vehicle production increased 58%, largely driven by increases in North America and Europe. Analysts expected revenue of $9.37 billion, for the quarter.

For fiscal 2021, the company now expects total sales in a range of $38.0 billion to $39.5 billion, revised from prior guidance range of $40.2 billion to $41.8 billion. Net income attributable to Magna is now expected in a range of $2.0 billion to $2.2 billion, revised from prior guidance of $2.2 billion to $2.4 billion.

The Board declared a second quarter dividend of $0.43 per common share, payable on September 3, 2021 to shareholders of record as of the close of business on August 20, 2021.

Shares of Magna International were down 4% in pre-market trade on Friday.

For comments and feedback contact: editorial@rttnews.com

Business News

Editors Pick
Twitter Inc. has launched a new feature to allow some users of its Blue subscriber service to keep non-fungible tokens or NFTs as their profile pictures. Twitter Blue is now available in the US, Canada, Australia, and New Zealand. NFT is a crypto token, which is non-fungible, meaning that it can neither be transferred like money nor replaced with something else. Frozen Food Development is recalling specific lots of Lidl branded 12-ounce packages of Frozen Chopped Spinach citing the potential to be contaminated with Listeria monocytogenes, the U.S. Food and Drug Administration said. The product comes in 12-ounce poly bags, and items included in the recall are marked with lot # R17742 or R17963 on the back of the poly bag with a best by date of 09/10/23. Starbucks has dropped its vaccine or weekly test requirement against Covid-19 for U.S. employees in the wake of last week's U.S. Supreme Court ruling. The court, in a 6-3 vote, has blocked President Joe Biden's vaccine-or-test mandate for private companies with 100 or more employees. However, it allowed the vaccine mandate to stand for certain health care workers.
Follow RTT