Sensata posts 2015, 4Q profit jump

ATTLEBORO – Sensata Technologies Holding N.V. reported a 214.4 percent jump in profit in the fourth quarter, and 22.5 percent increase in profit overall in 2015.
The company, which manufactures sensing, electrical protection, and control and power management solutions, released earnings on Tuesday, showing fourth-quarter profit of $218.3 million, or $1.27 per diluted share, compared with $69.5 million, or 41 cents per diluted share in the fourth quarter of 2014. For the full year, profit climbed to $347.7 million, or $2.03 per diluted share, from $283.7 million, or $1.65 per diluted share, in 2014.
Fourth-quarter revenue increased 3 percent to $726.5 million from $705.3 million in the 2014 fourth quarter. Full-year revenue grew 23.5 percent to $2.975 billion from $2.41 billion in 2014, the company said.

“Sensata delivered productivity gains, profitability improvements and solid financial performance in the fourth quarter in line with expectations,” Martha Sullivan, president and CEO, said in a statement. “Revenue continues to grow at a double-digit pace; Sensata delivered 14 percent compound annual revenue growth in the five years between 2010 to 2015.”

Sullivan also noted that “Sensata’s proven acquisition integration playbook will drive near-term earnings growth even in a low-growth environment.” The company acquired Schrader International, based in Colorado, in late 2014 for roughly $1 billion, a move that expanded its presence in the market for tire pressure sensors.

Last summer, Sensata reached an agreement to acquire the sensing portfolio of Custom Sensors & Technologies Inc. for $1 billion, a move that will extend the company’s reach beyond the automotive industry. The deal closed Dec. 1.

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Adjusted profit – a company-generated metric that reverses out restructuring, financing, hedging, changes in the fair value of fixed and intangible assets, deferred income tax and other tax expense and amortization of financing costs – was $113.3 million, or 66 cents per diluted share, in the fourth quarter compared with adjusted profit of $97.7 million, or 57 cents per diluted share in fourth quarter 2014. On an adjusted basis, full-year profit was $472 million, or $2.75 per diluted share, compared with $410.3 million, or $2.38 per diluted share.

The company spent $220.6 million, or 7.4 percent of revenue, on research and development in 2015.
In 2016, it expects revenue between $3.1 billion and $3.3 billion, and adjusted profit of $470 million to $515 million, or $2.74 to $3 per diluted share.

Among business segments, performance sensing revenue grew 33.6 percent in 2015 to $2.3 billion, while sensing solutions revenue declined nearly 4 percent to $628.7 million. The Americas were the largest revenue market for the company last year, representing 40.9 percent of business, followed by Europe at 33.4 percent and Asia, 25.7 percent.
European automotive again held the largest percentage of revenue last year at 27.4 percent, followed by North American automotive at 21.5 percent; Asian automotive at 17.6 percent; heavy vehicle off-road, 12.3 percent; industrial, 6.5 percent; appliance, and heating, ventilation and air conditioning, 5.8 percent; and rest of world automotive, 0.9 percent. All other business segments accounted for 8 percent of net revenue.

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