Quarter Profits up at Superior Industries

OE alloy wheel supplier Superior Industries International announced their financial results for the second quarter of this year on August 9, figures that show a solid increase in unit wheel shipments, net sales, gross margin and pre-tax income from continuing operations compared to the second quarter of 2006.

“The benefits of our hard work during the past several years to improve productivity, reduce costs, and position Superior for success as a truly global company are becoming increasingly evident in our financial performance,” said chairman, president and CEO Steven Borick.

For the three months ended June 30, 2007, net sales increased 16.1 per cent to US$255,217,000 compared to $219,880,000 for the second quarter of 2006, driven by a 3.7 per cent increase in unit wheel shipments, a higher percentage of large-diameter wheels in the sales mix than in the prior year, and higher pass-through aluminium costs in selling prices.

Gross profit increased 48.0 per cent to $13,578,000, or 5.3 per cent of net sales, for this year’s second quarter compared to $9,176,000, or 4.2 per cent of net sales, for the second quarter of 2006.

“The many new aluminium wheel programs we have won in recent months have increased production volume in our plants and helped us improve manufacturing productivity. The steady ramp in production volume at our new facility in Chihuahua, Mexico, the most advanced large-diameter wheel casting plant in the world, also contributed to the increase in gross margin, as did the progress we made during the quarter toward resolving certain production issues at our Midwest plants. We remain on track at our new Chihuahua plant to achieve our production goals set for the balance of 2007,” Borick said.

Selling, general and administrative expenses for the second quarter of 2007 increased to $9,037,000, or 3.5 per cent of net sales, from $7,455,000, or 3.4 per cent of net sales, in the same period a year ago. The principal increases were in stock-based compensation expense, professional fees related to legal and audit matters, and bonus accruals, which are based on a percentage of income.

Income before income taxes and equity earnings from joint ventures more than doubled to $5,121,000 for this year’s second quarter from $2,254,000 for the same period a year ago. After an adjustment to eliminate intercompany profits in inventory, our equity in earnings of joint ventures was $731,000 for the second quarter of 2007 compared to $1,129,000 a year earlier.

Net income from continuing operations for the second quarter of 2007 was $3,035,000, or $0.11 per diluted share. This compares to net income from continuing operations for the second quarter of 2006 of $2,228,000, or $0.08 per diluted share. Also included in the second quarter of 2006 was a net loss from our discontinued suspension components business of $121,000, resulting in net income of $2,107,000, or $0.08 per diluted share, a year ago.