TRW Profits Jump, Boosts Share Repurchase

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TRW AUTOMOTIVE HOLDINGS CORP.

LIVONIA (WWJ) – The Livonia automotive technology provider TRW Automotive Holdings Corp. (NYSE: TRW) reported net income of $197 million in the third fiscal quarter ended Sept. 27, up from $163 million last year.

Earnings per share were $1.60, up from $1.28.

Revenue was $4.21 billion, up from $397 billion.

For the nine months, net income was $607 million or $4.68 a share, up from $589 million or $4.58 a share in the first nine months of 2012. Revenue was $12.94 million, up from $12.41 million in the first nine months of the prior fiscal year.

Excluding special items from the company’s current and prior year quarterly results, the company reported third quarter 2013 net earnings of $187 million, or $1.52 per diluted share, which compares to net earnings of $157 million or $1.24 per diluted share in the prior year period.

Also, TRW said its board of directors authorized an additional $1 billion in share repurchases, bringing the total repurchase authorization to $2 billion. The available remaining repurchase authorization of $1.47 billion, which is expected to be executed over three years, reflects approximately 16 percent of TRW’s present market capitalization. Through the first nine months of 2013, the company used $460 million of cash to repurchase approximately 6.5 million shares of its common stock.

“TRW had another quarter of strong operating performance and continues to build on its positive momentum,” said John C. Plant, Chairman and CEO. “Increasing the size of our share repurchase program reflects our confidence in sustaining positive earnings and cash flow from our operations and further demonstrates our commitment to maximizing shareholder returns over time.”
Third quarter 2013 net cash flow provided by operating activities totaled $147 million, which compares to $156 million in the third quarter of 2012. Capital expenditures were $140 million in the current quarter compared to $125 million last year. Third quarter free cash flow (cash flow from operating activities less capital expenditures) was $7 million, compared to $31 million in the prior year quarter.

During the third quarter of 2013, TRW used approximately $260 million of cash to repurchase over 3.5 million shares of its common stock.

For the nine month period ended September 27, 2013, net cash provided by operating activities was $240 million, which compares to $245 million in the prior year period. Year-to-date capital expenditures were $411 million compared to $325 million in 2012. Free cash flow was an outflow of $171 million, compared to an outflow of $80 million for the same period last year. The unfavorable outcome compared to last year resulted primarily from higher working capital requirements and planned increases in capital expenditures to support future growth.

During the first nine months of 2013, TRW used approximately $460 million of cash to repurchase approximately 6.5 million shares of its common stock and $96 million of cash to retire $91 million of face value senior notes.

TRW expects full year industry production volumes to total 16.2 million units in North America and 18.9 million units in Europe. In addition, the company continues to expect expansion in vehicle production volumes in China and rest of world regions. Based on these production levels, the company’s performance through the first nine months of 2013 and expectations for foreign currency exchange rates, full year 2013 sales are expected to be approximately $17.1 billion.

“Increased demand for TRW’s innovative products combined with the company’s operating performance achieved through September will support another strong year for TRW,” said TRW CEO, president and chairman John C. Plant. “We remain focused on a good conclusion to the year and building on the company’s positive momentum to further enhance value to our shareholders.”

To listen to a replay of a conference call discussing these results, call (855) 859-2056 in the United States or (404) 537-3406 elsewhere, using the replay code

TRW products include integrated vehicle control and driver assist systems, braking systems, steering systems, suspension systems, safety systems, electronics and engine components.

More at http://www.trw.com.

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