Visteon(US:VC)2022-04-28 11:10Financial Performance - Net sales for Q1 2022 were $818 million, an increase of 9.6% compared to $746 million in Q1 2021[10] - Gross margin improved to $76 million in Q1 2022, up from $73 million in Q1 2021, reflecting a gross margin percentage increase[10] - Net income attributable to Visteon Corporation was $22 million in Q1 2022, compared to $16 million in Q1 2021, representing a 37.5% increase[10] - Basic earnings per share attributable to Visteon Corporation rose to $0.79 in Q1 2022 from $0.57 in Q1 2021, marking a 38.6% increase[10] - Adjusted EBITDA for the three months ended March 31, 2022, was $71 million, an increase from $64 million in the same period of 2021[95] - The Company recorded a net income of $22 million for the three months ended March 31, 2022, compared to $16 million in the same period of 2021, resulting in a basic earnings per share of $0.79, up from $0.57[63] Assets and Liabilities - Total assets as of March 31, 2022, were $2,243 million, slightly up from $2,234 million as of December 31, 2021[12] - Cash and equivalents decreased to $402 million as of March 31, 2022, down from $452 million at the end of 2021[12] - Total liabilities remained stable at $1,601 million as of March 31, 2022, compared to $1,618 million as of December 31, 2021[12] - The Company has $349 million in term debt facility and no short-term borrowings as of March 31, 2022[43][44] - The Company has $176 million in other current assets as of March 31, 2022, an increase from $158 million as of December 31, 2021[38] Cash Flow and Investments - The Company reported a net cash used by operating activities of $21 million in Q1 2022, compared to a net cash provided of $11 million in Q1 2021[14] - The Company expects to receive cash reimbursement payments of $27 million during the remainder of 2022 related to contractually reimbursable engineering costs[40] - The Company has contributed approximately $10 million toward a total commitment of $15 million in equity investments in automotive sector funds as of March 31, 2022[29] - Cash contributions to the Company's non-U.S. defined benefit plans were $1 million in Q1 2022, with an estimated total of $4 million for the entire year[52] Inventory and Restructuring - As of March 31, 2022, the Company's total inventories increased to $331 million from $262 million as of December 31, 2021[36] - As of March 31, 2022, the Company's restructuring reserves decreased to $16 million from $18 million as of December 31, 2021[33] - The Company recorded $1 million of restructuring expense primarily related to employee severance due to the suspension of operations in Russia[36] Market and Economic Conditions - The Company is currently facing significant macro-economic uncertainty, including supply chain disruptions and inflationary pressures, which may negatively impact business operations[153] - The conflict in Ukraine has exacerbated the volatility in prices of commodities and components, affecting the company's cost structure[154] - The company is negotiating with customers regarding cost increases due to rising raw material and transportation costs, but success is uncertain[155] - The automotive mobility market is expected to grow faster than underlying vehicle production volumes as vehicles transition to digital and electric technologies[99] Risk Management - The company is exposed to market risks from changes in currency exchange rates, interest rates, and commodity prices, managed through fixed price contracts and derivative instruments[140] - The company utilizes a strategy of partial coverage for foreign currency exposures, primarily in euros, Chinese renminbi, and Brazilian real[141] - The hypothetical pre-tax gain or loss from a 10% change in currency exchange rates would be $30 million for currency derivative financial instruments as of March 31, 2022[143] Compliance and Controls - The company maintains effective disclosure controls and procedures as of March 31, 2022[147] - There were no changes in the company's internal control over financial reporting that materially affected its effectiveness during the three months ended March 31, 2022[148]