ERJ staff report (R&PN)
Southfield, Michigan-Federal-Mogul Corp. posted its third-consecutive net income in the fourth quarter.
The company reported $43 million in net income on revenue of $1.4 billion in the fourth quarter, versus a $530 million net loss on revenue of $1.4 billion in the same period the prior year.
The supplier of powertrain, safety and aftermarket auto parts posted its largest quarterly profit of the year on savings from cost-cuts implemented in 2009.
In the fourth quarter, the company reduced about $100 million in costs from the prior-year period, Chief Financial Officer Jeff Kaminski said.
But a $101 million net loss in the 2009 first quarter kept Federal-Mogul in the red for the full year, posting a $45 million net loss on revenue of $5.3 billion, compared with a $468 million net loss on revenue of $6.8 billion in 2008.
CEO JosÃ© Maria Alapont said in a conference call that the company expects higher vehicle sales in North America in 2010, but the company will continue cutting costs as vehicle production and sales increase over the course of the year.
At the end of 2009, Federal-Mogul had about $1 billion in cash and an undrawn $500 million revolving loan.
Alapont said that level of liquidity gives the company the ability to acquire distressed suppliers and make strategic acquisitions in industrial, transportation and energy markets, which currently accounts for about 9 percent of the company's global revenue.
From Rubber & Plastics News (A Crain publication)