Superior Industries (SUP) Posts Loss In Q4, Misses On Sales

Superior Industries International, Inc. (NYSE:SUP) reported adjusted fourth-quarter 2019 loss of 8 cents, narrower than the Zacks Consensus Estimate of a loss of 35 cents. The narrower-than-expected loss resulted from higher-than-expected shipments and revenues in European markets. The loss per share also narrowed 50%, year on year.

The aluminum-wheel manufacturer reported revenues of $310 million, missing the Zacks Consensus Estimate of $332 million. The top line also came in lower than the year-ago figure of $379 million. This downside resulted mainly from lower volumes, including the impact of the General Motors (NYSE:GM) strike as well as lower aluminum price.

Superior Industries International, Inc. Price, Consensus and EPS Surprise

Quarter Details

During the fourth quarter, the company’s wheel unit shipments decreased 14% year over year to 4.5 million. This downside primarily stemmed from shipment declines in North America and Europe due to lower year-over-year production, including the impact of the UAW labor strike at GM. Shipments in Europe came in at 2.3 million, down from the 2.5 million recorded in fourth-quarter 2018. In North America, the shipments were 2.18 million, lower than the year-ago figure of 2.64 million.

Sales in the European market came in at $159.6 million, lower than the $185.1 million recorded in the year-ago quarter. Sales in the North American market totaled $150.7 million, down from the prior-year period’s $193.7 million.

The company reported operating loss of $92 million as against operating profit of $19 million in the year-ago quarter. Selling, general and administrative expenses in the quarter were $17 million, flat year over year.

Net cash provided by operating activities summed $61 million in the December-end quarter, down from the year-ago quarter’s $92 million. Capital expenditure amounted to $16.7 million.

During the quarter, Superior Industries paid dividends of $3 million and purchased $3 million of shares from minority equity holders of Superior Industries Europe AG. As of Dec 31, 2019, the company’s net debt was $553 million, representing debt-to-capital ratio of 68.72%.

2020 Outlook

For full-year 2020, Superior Industries projects unit shipments of 18.4-19 million. Net sales are projected between $1.33 million and $1.39 million, and cash flow from operations is projected at $125-$145 million. Adjusted EBITDA is expected in the range of $170-$190 million and capex is expected to be around $75 million.

Zacks Rank & Stocks to Consider

Superior Industries currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Auto-Tires-Trucks sector include SPX Corporation (NYSE:SPXC) and Adient PLC (NYSE:ADNT) , each carrying a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

SPX has an expected earnings growth rate of 6.52% for 2020. The stock has rallied 23% in the past year.

Adient has an estimated earnings growth rate of 17.79% for the current year. The company’s shares have appreciated 23.4% over the past year.

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