Federal-Mogul says one-time charge causes Q2 loss
DETROIT (Reuters) -- Auto parts supplier Federal-Mogul Corp. posted a quarterly loss on charges relating to the restructuring of its brake friction business.
The company, which said in June that it was going to restructure several facilities to reduce capacity, took an impairment charge of $119 million in the second quarter, according to a statement.
The company, controlled by activist investor Carl Icahn, posted a net loss attributable to the company of $59 million, or 60 cents per share, compared with a profit of $64 million, or 64 cents per share, a year earlier.
"Without (the) impairment charges, net income would have been $53 million in the quarter," the company said.
On that basis, the company earned 54 cents a share, according to Thomson Reuters, which compares with the average profit expectation of 56 cents per share from two analysts.
Revenue for the quarter ended June 30 fell 6 percent to $1.7 billion, hurt by lower light vehicle production in Europe. Analysts were expecting revenue of $1.84 billion.
The company based in suburban Detroit said its full-year revenue would benefit from the recent acquisition of BorgWarner Inc.'s spark plug business. Federal-Mogul already owns the Champion spark plug brand.
"The acquired units will add about $80 million annualized sales and increase Federal-Mogul's annual spark plug production capacity to more than 350 million per year," Federal-Mogul said today.Contact Automotive News