Cooper Standard hits Q2 records despite Europe woes

Novi, Michigan – Cooper-Standard Holdings Inc. has posted “record” sales and earnings (adjusted EBITDA), which increased respectively 3.4% to $909.1 million and 4.8% to $113.8 million in the second-quarter, the company announced 3 Aug.

The US company linked the higher sales to better volume and mix, and the impact of acquisitions and divestitures, partially offset by price reductions and negative foreign currency exchange rates.

Cooper-Standard attributed the earnings gains to operating efficiencies, the impact of acquisitions and divestitures, and supply-chain optimisation. The factors more than offset an unfavourable vehicle production mix, price reductions and higher net compensation-related costs.

In its Europe segment, however, Cooper-Standard’s second quarter sales fell 7.8% to $260.4 million due to unfavourable volume and mix, foreign exchange and price reductions.

The regional segment also reported a loss of $3.1 million compared to a prior-year-quarter profit of $0.7 million. An unfavourable volume and mix, price reductions and the impact of wage and general inflation in Europe were only partially offset by restructuring savings and improvements in operating efficiency.

By contrast, the company's North America segment increased sales by 4.5% to $481.6 million in the second quarter mainly due to favourable volume and mix and the acquisition of AMI Industries' fuel and brake business. Segment profit rose 6.4% to $64.5 million helped largely by gains in operating efficiencies.

The company's Asia Pacific segment reported sales up 21.2% to $140.8 million in the second quarter on improved volume and mix, and the consolidation of the company's sealing joint venture in Guangzhou, China.  These items were partially offset by unfavourable foreign exchange and customer price reductions. Profit there was $4.5 million, compared to $0.5 million in the second quarter 2016.

Overall, Cooper-Standard’s business performance was also helped by the launch of 54 new customer ‘programs’ and  $96.4 million in annual net new business.  The latter included a second significant production contract for new static sealing products, said to offer weight-reduction and performance improvements versus EPDM and TPV-based systems.

During the second quarter, Cooper-Standard also entered into a first agreement to license the technology, called Fortrex, outside of the automotive industry.