Magna, American Axle expect growth in 2012; Lear to buy more stock
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DETROIT (Reuters) -- Suppliers Magna International Inc. and American Axle and Manufacturing Holdings Inc. predict sales will grow in 2012 with help from expansion in new markets and business diversification.
Magna, in a statement today, said it expects its total sales will be between $27.8 billion and $29.3 billion, up $2.2 billion from its current estimates for 2011. The company has not yet reported final 2011 results.
Production sales are expected to range between $23.6 billion and $24.7 billion, it said, anticipating between $13.2 billion and $13.7 billion in sales in North America and between $8.4 billion and $8.7 billion in Europe, respectively.
The Canadian company also expects 2012 operating margins to be about 5 percent, after lowering its 2011 operating margin outlook to 4.75 percent.
“We are taking advantage of the growth opportunities in new markets and positioning Magna to further serve our customers on global platforms,” Magna CEO Don Walker said in the statement.
American Axle diversifies
As for American Axle, which makes axle and driveline components for trucks and larger vehicles, it expects 2012 sales to total between $2.8 billion and $2.9 billion, a report from Reuters said, quoting an official from the Deutsche Bank Global Auto Industry Conference in Detroit today.
Analysts on average had expected 2012 sales of about $2.83 billion, according to Thomson Reuters.
American Axle also said it expects to increase sales to non-GM customers to 50 percent by 2015. Typically, more than 70 percent of American Axle's business has been with GM.
“We are seeing over time, a little bit lower margin profile to reflect a broader set of business with different customers in more programs, with a lower average volume per program,” the company's report at the conference said.
The company is aiming for a 2012 capital expenditure of about 6 percent of sales to support its new $1.1 billion business backlog from 2012 to 2014.
Lear stock buyback
Meanwhile, interiors and electronics supplier Lear Corp. said its board authorized a $300 million increase to its existing share buyback program.
Lear said it will now buy back $700 million worth of shares. The share repurchase authorization will expire on Feb. 16, 2014, it said in a statement.
Through the end of 2011, the company has completed the purchase of $279 million of stock of its previously announced $400 million share repurchase authorization.
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