NORTHVILLE — Gentherm Inc. (Nasdaq: THRM), the Northville-based thermal management technology developer, reported net income of $27.7 million or 76 cents a share in the third quarter, up from $17.3 million or 48 cents a share in the third quarter of 2014.
Revenue was $223.8 milion, up from $206 million a year earlier.
For the nine months, net income was $67 million or $1.84 a share, up from $50.3 million or $1.40 a share a year earlier. Revenue for the first nine months of the year was $644.2 million, up from $606.1 million a year earlier.
“We had another solid and productive quarter, particularly in terms of our bottom-line performance,” said President and CEO Daniel R. Coker. “Our top-line revenue growth during the quarter was not quite what we expected, but that was largely due to currency headwinds. Adjusting for the currency impacts, we believe our revenue growth would have been close to 15 percent over the 2014 third quarter. We continue to be pleased with our overall execution in terms of operations, cost controls, and margin improvement, all of which drove our profitability in the quarter at a rate that we believe is sustainable. … We also continue to make progress in expanding our manufacturing facilities in key markets around the world. In Europe, our new Macedonia operation has started to ship products from an initial production line, and, in Asia, our new Vietnam facility is in the final stages of opening.”
The company said greater revenue was driven primarily by higher sales for GPT, and continued strong shipments of climate controlled seats.
The stronger U.S. dollar hit the company’s European revenue, since the average exchange rate is now $1.11 to the Euro, vs. $1.33 a year earlier. Thus, the company’s Euro-dominated revenue rose in Euros — but fell after conversion into the U.S. dollar. Had the 2015 average exchange rates for this period been the same as the 2014 average exchange rates for these currencies, Gentherm’s product revenues would have been $13.1 million higher than the revenues actually reported for the third quarter of 2015. Adjusting for these unfavorable currency translation impacts, the third quarter 2015 product revenues would have been $236.9 million or 15 percent higher than the third quarter 2014.
Climate controlled seat revenue rose 6 percent to $93.3 million quarter over quarter, the result of new program launches since the third quarter 2014, strong production volumes and related sales of vehicles equipped with CCS systems, particularly vehicles in the luxury segment, such as the redesigned Ford Mustang, which now offers CCS for the first time. Global power technologies revenue jumped 145 percent to $21.1 million from $8.6 million a year earlier. And seat heater revenue fell 7 percent to $74.1 million, a casualty of the strong U.S. dollar.
Gross margin as a percentage of revenue for first nine months of 2015 was 32.2 percent compared with 29.6 percent for the first nine months of 2014.
Total cash as of Sept. 30 increased 98 percent to $129.2 million from $65.2 million as of Sept. 30, 2014 and up 51 percent from $85.7 million as of Dec. 31, 2014.
The company lowered its revenue guidance due to the stronger U.S. dollar, now saying it expects revenue to rise 6 percent for 2015 from 2014’s $811 million, and that it expects 2016 revenue to rise about 10 percent from 2015 revenue.
To listen to a replay of a conference call discussing these results, visit the events page of the investor section of Gentherm’s website at www.gentherm.com.
Gentherm’s automotive products include actively heated and cooled seat systems and cup holders, heated and ventilated seat systems, thermal storage bins, heated automotive interior systems (including heated seats, steering wheels, armrests and other components), battery thermal management systems, cable systems and other electronic devices. Non-automotive products include remote power generation systems, heated and cooled furniture and other consumer and industrial temperature control applications.