ALMELO, Netherlands (
(ST - Get Report)
lowered its fiscal fourth-quarter outlook Monday because of weakness in its sensors business.
The company cited the impact of flooding in Thailand, lower production levels for several original equipment manufacturers, and reduced inventories in the automotive supply chain.
Sensata said it sees a reduction in revenue of $20 million to $25 million from the midpoint of its prior outlook of $470 million, and anticipates adjusted earnings will be lower by 3 to 5 cents a share from the midpoint of its previous view of 48 cents a share.
"There continues to be a great deal of uncertainty in the global economy and many of the automotive OEMs and tier suppliers are reacting accordingly," said Tom Wroe, the company's chairman and CEO, in a statement. "We believe the impact to Sensata is early in the economic cycle in comparison with other industrial and technology companies."
The company also said it now expects to record a restructuring charge of $10 to $15 million in the quarter, much higher than its original projection of $3 million to $5 million. It cited higher severance costs stemming from workforce reductions.
The stock was last quoted at $29.60, down more than 2%, on after-hours volume of less than 30,000, according to
Written by Chris Ciaccia in New York
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Tom Wroe , Chairman and Chief Executive Officer, said, "There continues to be a great deal of uncertainty in the global economy and many of the automotive OEMs and tier suppliers are reacting accordingly. We believe the impact to Sensata is early in the economic cycle in comparison with other industrial and technology companies." He added, "We will continue to evaluate these trends as they relate to our expectations for 2012. Nonetheless, we remain confident in the long term growth opportunities for Sensata and our cash generation capabilities." The Company has also revised its guidance for the restructuring charge that it expects to recognize in the fourth quarter of 2011. The Company now expects the restructuring charge in the fourth quarter to be approximately $10 to $15 million , up from the previous guidance of $3 to $5 million . The restructuring charge will consist primarily of severance associated with workforce reductions. This charge is excluded from the Adjusted net income(1) outlook. Robert Hureau , Senior Vice President and Chief Financial Officer, added, "We are committed to managing our cost structure in a manner that preserves our margins and growth investments. Accordingly, the increase in the restructuring charge reflects a broader set of actions than previously contemplated." The Company will provide more information regarding the fourth quarter 2011 results along with first quarter and full year 2012 guidance during its year-end conference call. The call has not been scheduled at this time.