Parts maker Visteon raises forecast as auto sales improve

Reuters

* Raises full-year EBITDA forecast to $680 mln-$700 mln

* 3rd-quarter net income nearly triples to $43 mln

* Revenue rises 6.8 pct

Nov 7 (Reuters) - Auto parts maker Visteon Corp raised its full-year earnings forecast after third-quarterprofit nearly tripled due to cost cutting and higher sales ofclimate control systems.

Visteon and peers BorgWarner Inc and Lear Corp are benefiting from strong vehicles sales in the UnitedStates. Auto makers are also expected to report some of theirhighest sales since 2006 in the coming year.

Visteon, formerly a unit of Ford Motor Co, raised itsfull-year forecast for adjusted EBITDA to $680 million-$700million from $660 million-$690 million.

"Our revised guidance primarily reflects an improved outlookfor our climate electronics business," Chief Financial OfficerJeffrey Stafeil said on a post-earnings conference call.

The company's climate and electronics businesses accountedfor 80 percent of its total sales in 2012.

The climate business comprises heating, ventilation, airconditioning and powertrain cooling systems, while theelectronics business include infotainment and driver informationsystems.

However, Visteon's shares fell 2 percent to $75.25 in earlytrading as its earnings barely beat analysts' estimates. Thecompany handily beat estimates in the three previous quarters.

"Given the track record of significantly beating in recentquarters on execution related margin upside, we think theseresults are likely softer than most investors' expectations," JPMorgan analyst Ryan Brinkman wrote in a note to clients.

Visteon's shares had gained 54 percent in the past 12 monthsto Wednesday's close, outperforming the S&P 500 index.

TRIMMING COSTS

Visteon said in December it would close plants around theworld to cut costs.

The company's gross margins rose 11 percent to $143 millionin the quarter ended Sept. 30. Selling, general andadministrative expenses fell 2 percent.

Hyundai-Kia, Visteon's largest customer, accounted for about34 percent of the company's overall third-quarter revenue, whichrose 6.8 percent to $1.73 billion. Ford made up about 28percent.

Net income attributable to the company nearly tripled to $43million, or 85 cents per share.

The company reported adjusted earnings of $1.17 per share.Analysts on average had expected earnings of $1.16 per share,according to Thomson Reuters I/B/E/S.

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