Federal-Mogul Corporation recently reported its second quarter 2010 financial results, with sales of $1.6 billion, 23 percent higher than that of Q2 2009, with a net income of $49 million.
“Federal-Mogul’s results in the second quarter of 2010 show our ability to deliver strong financial performance by converting incremental revenue to profitability due to our continued focus on efficiently managing our cost base established during 2009,” said Jose Maria Alapont, president and chief executive officer. “Federal-Mogul’s margins, both in absolute terms and as a percentage of sales, are significantly higher than a year ago and we have strongly improved year-over-year cash flow.”
For the first half of 2010, compared to the same period one year ago, Federal-Mogul converted additional sales of $545 million into additional net income of $161 million, a conversion rate of 30 percent.
The company’s stronger sales performance is the result of market share gains in all regions and markets, on top of a significant improvement in global automotive original equipment light vehicle and commercial vehicle market demand. Federal-Mogul’s sales in Q2 2010 of $1,598 million improved 23 percent, versus $1,304 million recorded during the same period one year ago. The company’s original equipment sales increased in North America by 81 percent, Asia Pacific by 46 percent and Europe by 31 percent. Federal-Mogul’s growth in key developing markets continued strong with year-over-year growth of 63 percent in China and 20 percent in India.
“Our strong second quarter earnings and cash flow performance demonstrates once again that we are on the right track,” Alapont said. “The company’s commitment to leading technology and innovation to drive growth in developing markets was recently confirmed with the official grand opening of our Asia Pacific Headquarters and Technical Centre. Federal-Mogul’s 100,000 square foot facility in Shanghai contains some of the most sophisticated development, testing and analysis equipment in our global engineering network. We already manufacture in Asia Pacific the main products in our portfolio within our 21 manufacturing sites located in the region, supporting leading light vehicle, heavy-duty and aftermarket customers. We remain committed to enhancing and developing our presence in the Asia Pacific region.”
“The company’s recent acquisition of the Daros Group will expand Federal-Mogul’s global presence and portfolio of energy, industrial and transport products. Both of these initiatives demonstrate our growth and focus on developing innovative solutions to meet the increasing requirements of our customers and solve the industry’s most pressing challenges for fuel efficiency, emissions reduction and improved vehicle safety. Through strong financial performance, customer satisfaction and leading technology, we are demonstrating our capability to generate sustainable global profitable growth,” Alapont concluded.