Wabco Reports Second-Quarter, Six-Month Gains With Higher Content Per Vehicle
Commercial vehicle supplier Wabco Holdings Inc. reported earnings and revenue rose in the second quarter and in the six-month period as it added market share.
The company also said it upgraded its sales guidance for 2016 to $2.86 billion from $2.78 billion versus previous guidance to $2.83 billion from $2.7 billion.
Upgrades reported to diluted earnings per share guidance for full year now range from $3.73 to $4.03 versus previous guidance from $3.43 to $3.93, according to the company.
In the quarter ended June 30, net income rose 14% to $75.1 million or $1.33 per diluted share, compared with $65.8 million or $1.12 a year earlier. Sales were $ 732.2 million, an increase of 10.8% from $661.1 million in the 2015 period.
The cost of those sales rose 10.7% to $502.2 million from $453.6 million a year earlier, it said, adding its largest expense is material costs, which mainly represents the purchase of components and parts.
Wabco said its largest selling products are pneumatic anti-lock braking systems, electronic braking systems, electronic stability control, automated manual transmission systems, air disc brakes and a large variety of conventional mechanical products such as actuators, air compressors and air control valves for medium- and heavy-duty trucks, buses and trailers. It said about 14% of its sales are in the United States.
“Overall, we augmented levels of Wabco content per vehicle through market share gain and further adoption of safety and efficiency technologies,” Jacques Esculier, Wabco chairman and CEO, said in a statement.
Sales in North America decreased 5.8%, driven by an estimated 19% decrease in production of new trucks and buses. It is mainly supplying to the heavy-duty truck segment, which dropped 32%, Wabco said.
In the report, the company noted it had acquired Laydon Composites Ltd. in April, a manufacturer of aerodynamic devices for heavy-duty trucks and trailers, for total consideration of $34.1 million.
After the acquisition, LCL signed supply agreements with two North American major fleets to equip thousands of new trailers with LCL’s patented aerodynamic solutions to help lower their fuel consumption and CO2 emissions, Wabco said.
Also in the quarter, the company announced a joint development with ZF to connect active steering to Wabco’s extensive active braking capability. Adding lateral control to Wabco’s full longitudinal control of both truck and trailer is an industry-first milestone on the path to autonomous driving for commercial vehicles, Wabco said. The first application of Evasive Maneuver Assist was successfully demonstrated in June, the company said.
Year-to-date, net income fell to $61.7 million, or $1.09 per share, compared with $137.7 million, or $2.36, reflecting Wabco’s loss in the first quarter.
Sales rose 8.2% to $1.42 billion from $1.31 billion in 2015.
