4/23/2008
Federal-Mogul Reports Record First Quarter Sales
Federal-Mogul has reported
its first quarter 2008 financial results, including record quarterly
sales of $1.86 billion, an increase of 8 percent over the same period
of the prior year.
During the first quarter, the company recorded a one-time, non-cash
charge of $68 million relating to re-valuation of inventory, as
required by fresh-start reporting following emergence from Chapter 11
in December 2007. The company reported a net loss of $(32) million as
compared to net income of $5 million in the first quarter of 2007.
Without the inventory charge and the associated tax impact, net income
would have been $32 million, or 2 percent of sales. Federal-Mogul's
Operational EBITDA was $206 million or 11 percent for the first quarter
of 2008, up from the same period in 2007 when the company reported
Operational EBITDA of $199 million.
During the quarter, sales were $1.86 billion, up $143 million, or 8
percent above the same period in 2007. The sales results were impacted
by favorable currency exchange of $120 million and increased sales of
$23 million, principally to European original equipment vehicle
manufacturers. The company said it continues to benefit from strong new
business bookings with balanced regional sales and a globally diverse
customer base with no single customer accounting for more than 7
percent of global sales as of Dec. 31, 2007.
Federal-Mogul realized a gross margin of $266 million or 14.3
percent of sales in the first quarter of 2008, versus $308 million or
17.9 percent of sales in the first quarter of 2007. The gross margin
was unfavorably impacted by a $68 million, non-cash inventory
adjustment previously discussed. Without the inventory adjustment,
gross margin for the quarter would have been $335 million, or 9 percent
above the prior year and at 18 percent of sales. This improvement shows
that the company maintained its operating performance in spite of
ongoing raw materials, energy and other general industry cost pressure.
Selling, general and administrative (SG&A) expense for the
quarter was $209 million, in comparison to $207 million in the same
period in 2007. SG&A as a percentage of sales was favorably reduced
in the first quarter of 2008 to 11.2 percent compared to 12.1 percent
in the same period a year ago. The change in SG&A comprised a
reduction of $8 million offset by unfavorable currency exchange of $10
million during the quarter.
Federal-Mogul reported cash flow for the first quarter of 2008 of
$49 million, which compares favorably to $12 million in the same period
of 2007.
On April 7, Federal-Mogul announced it will list its Class A Common
Stock on the NASDAQ Global Market on April 23, and will trade under the
symbol "FDML."
"We are pleased to report a strong quarter, which shows the
benefits of our solid operating performance, combined with our
customer, regional and product line diversification. More than 60
percent of our revenue in the quarter was generated outside the U.S.,"
said President and Chief Executive Officer Jose Maria Alapont. "The
Operational EBITDA is improved as a result of our restructuring and
cost-reduction efforts as outlined in our strategy for sustainable
global profitable growth."
For more information about Federal-Mogul, visit: www.federal-mogul.com.