(Alliance News) - TI Fluid Systems PLC on Thursday said challenging light vehicle production environment, notably in China, and cost increases in Europe resulted in a sharp drop in first half earnings.
The company also said it expects 2019 revenue to be lower than the prior year and its adjusted earnings before interest and taxes margin to be in-line with the year before, albeit slightly weaker than the 10.1% recorded in the first six months of the year.
Shares in the automotive fluid storage and delivery systems manufacturer were down 7.2% in London at 182.00 pence each, making the stock one of the worst FTSE 250 performers on Thursday.
For the six months to June-end, the company recorded pretax profit of EUR93.4 million, down 25% from EUR124.0 million in the year ago period, on a revenue of EUR1.71 billion and EUR1.77 billion, respectively.
Adjusted Ebit for the first half fell to EUR173.1 million from EUR200.8 million.
"The group continued to outperform global light vehicle production, however, the global automotive market remains challenging. We are confident in our strategy, business model, operating flexibility and strength in our ability to generate strong free cash flow in 2019," said President & Chief Executive Officer William Kozyra.
In the six months, global light vehicle production volumes declined 6.7% year-on-year in all markets and reached 45.2 million vehicles.
"We are well positioned on electric vehicles with new collaboration projects with key customers, including in China, to reduce weight, and maximise power density in the vehicle through thermal products and systems. The group remains well positioned for the automotive megatrends of reduced emissions and electrification," Kozyra added.
TI Fluid, which has maintained its interim dividend at 3.02 cents per share, said it invested in a new thermal products facility in Morocco during the first half to primarily supply electric vehicles.
TI Fluid Systems (TIFS)
