Mr. Don Walker reports
MAGNA ANNOUNCES OUTLOOK
Magna International Inc. has released its financial outlook for 2017, along with sales expectations for 2019. In this outlook the company has assumed no material unannounced acquisitions or divestitures. In addition, the company has assumed that foreign exchange rates for the most common currencies in which it conducts business relative to its U.S.-dollar reporting currency will approximate year-end 2016 rates.
OUTLOOK
2017 2019
Light vehicle production (units)
North America 17.7 million 18.4 million
Europe 21.7 million 22.5 million
Production sales
North America $19.2-billion-$19.8-billion $20.4-billion-$21.2-billion
Europe $8.7-billion-$9.1-billion $10.1-billion-$10.7-billion
Asia $2.2-billion-$2.4-billion $3.2-billion-$3.5-billion
Rest of world $300-million-$400-million $400-million-$600-million
Total production sales $30.4-billion-$31.7-billion $34.1-billion-$36.0-billion
Complete vehicle assembly sales $2.7-billion-$3.0-billion $6.6-billion-$7.1-billion
Total sales $36.0-billion-$37.7-billion $43.5-billion-$46.2-billion
EBIT margin(1) Approximately 8%
Interest expense Approximately $90-million
Tax rate 25%-26%
Capital spending Approximately $2-billion
"Magna has a long history of above-market sales growth, and 2016 was no exception. As we look forward over the next three years, we expect our sales to continue to outpace industry production.
"Longer term, we believe our capabilities and new innovations, together with our deep customer relationships, will position us for continued growth as a preferred supplier for the car of the future," said Don Walker, Magna's chief executive officer.
"We have made good progress in improving our margins over the last number of years. We believe there is potential for further margin progress by 2019, across each of our reporting segments. We expect to translate our sales growth, margins and solid returns into strong free cash flow generation over the next three years." said Vince Galifi, Magna's chief financial officer.
The company will be making a presentation at the Deutsche Bank Global Auto Industry Conference on Wednesday, Jan. 11, 2017, at 1:20 p.m. ET, during which it will review the details of its outlook. The presentation will be webcast and available on the company's website. The slides accompanying the presentation will be available on the company's website on Wednesday morning by 7 a.m. ET.
We seek Safe Harbor.
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