China Automotive Systems Inc. Earnings: Consecutive Profit Quarter Streak Stays Intact
China Automotive Systems Inc. (NASDAQ:CAAS) reported its results for the fourth quarter. China Automotive Systems is a holding company that, through joint ventures in China and a wholly-owned subsidiary, manufactures power steering systems and other component parts for automobiles.
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China Automotive Systems Earnings Cheat Sheet for the Fourth Quarter
Results: Net income for the auto parts company fell to $6 million (19 cents per share) vs. $10.6 million (22 cents per share) a year earlier. This is a decline of 43.4% from the year-earlier quarter.
Revenue: Fell 1% to $99.5 million from the year-earlier quarter.
Actual vs. Wall St. Expectations: China Automotive Systems Inc. beat the mean analyst estimate of 16 cents per share. It beat the average revenue estimate of $96.2 million.
Quoting Management: Mr. Qizhou Wu, chief executive officer of the Company, commented: “2011 was a challenging year for the Chinese auto industry. However, we held our ground by increasing domestic penetration in Dongfeng PSA and growing our export business with Chrysler North America. Our new products, especially electric power steering (“EPS”), grew in unit volume and commanded higher prices. On the strategic partnership front, we added two key joint ventures with Shanghai Auto-IVECO Hongyan in early 2012 and Beijing Auto, which will significantly lift our presence in these large organizations and pave the way for broader cooperation in the future. In addition, we will form a joint venture outside of China and establish a foothold in another large and rapidly growing market, Brazil.”
The company trumped estimates last quarter after falling shy in the two quarters prior. In the third quarter, it missed the mark by 5 cents, and in the second quarter, it came in under estimates by 10 cents.
Revenue has dropped for three consecutive quarters. In the third quarter, revenue declined 1.4% to $75 million while the figure fell 3% in the second quarter from the year earlier.
Looking Forward: The average estimate for the first quarter of the next fiscal year is steady at 17 cents a share. For the fiscal year, the average estimate has moved down from 64 cents a share to 63 cents over the last thirty days.
(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)
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