CHICAGO -- Gentex Corp., which makes automatic-dimming rearview mirrors for vehicles, on Wednesday said quarterly earnings rose nearly 11 percent, helped by increased shipments to Asian automakers in North America.
Gentex also said it expects unit growth of 10 percent to 15 percent in mirror shipments in the fourth quarter. It said the forecast may be conservative, but it was remaining cautious because of uncertainties in the automotive industry.
Net income rose to $27.9 million, or 18 cents per share, in the third quarter, from $25.2 million, or 16 cents per share, a year earlier, the Zeeland, Michigan-based company said. Analysts on average were expecting 16 cents per share, according to Reuters Estimates.
Revenue rose 15 percent to $138.1 million.
Gross margin was slightly lower than anticipated, mainly because of new manufacturing processes that are taking longer than expected to work out, said Gentex, which also makes fire safety equipment.
Gentex's focus on patented technology has allowed it to continue charging a premium for its products and hold on to profits in an auto parts supplier sector that has been buffeted by vehicle production cuts, high raw materials costs and price cuts that have driven other suppliers into bankruptcy.
However, it still faces pricing pressures from automakers and the difficulty in working through challenges in start-up business has made it harder to offset price cuts, Gentex said.
Mirror shipments rose 16 percent overall to 3.2 million units in the quarter, with North American shipments up 14 percent on higher shipments to Asian automakers and accelerated growth in exterior mirrors, Gentex said. Shipments in Asia and Europe rose 18 percent.
Shipments increased well beyond the industry's overall light vehicle production, which was up 2 percent in North America, down 1 percent in Europe and up 6 percent in the Japan and Korea markets, Gentex said.
Gentex said it recently negotiated a three-year extension through 2009 for its agreement with DaimlerChrysler for nearly all interior and exterior auto-dimming mirrors.
In April, Gentex announced an extension through 2009 for its agreement with General Motors, its top customer last year. Gentex suffered earlier in 2005 from GM production cuts on SUVs in North America.
Gentex ranks No. 128 on the Automotive News list of the top 150 suppliers to North America with North American original-equipment automotive parts sales of $266 million in 2004.