This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Federal-Mogul's CEO Discusses Q4 2011 Results - Earnings Call Transcript

In response to this growth, Federal-Mogul in 2011 invested $348 million to increase manufacturing capacity in existent and greenfield sites drive higher operational efficiency and develop and launch new technology with customers. This is (inaudible) the investment of two years ago.

Let's move to Page 5. Federal-Mogul sales in 2011 as I said were a record level of $6.9 billion. Gross margin improved by $81 million or 8% more than $1 billion. Operating margin was up by 0.6% to 5.8%. SG&A was an all-time low at 10% of sales and EBITDA increased to $702 million, up $31 million versus the previous year.

Federal-Mogul recorded a net loss in the fourth quarter of $239 million and a $90 million net loss for the full year reflecting a Q4 2011 impairment charge of $304 million, primarily due to a difference in the evaluation on selected product lines versus the value established in 2007 and at the time of the Fresh-Start reporting in connection with the Federal-Mogul Chapter 11.

The company's 2011 annual goodwill analysis indicate a decline in the fair value of selected product lines that have been impacted by factor in the US aftermarket. The company believes, however, that increases in its other reporting units such as powertrain, would largely offset the decline. But United States GAAP rules do not permit the recognition of gains in the value of one of the reporting units to offset impairment charges in another reporting unit.

When eliminating the impact of the goodwill impairment, adjusted net income was up for 2011 by $69 million to $203 million and the fourth quarter adjusted net income was $51 million, up from the $38 million in the fourth quarter of last year.

Thermal continues to transform its business to include a broader global portfolio of innovative leading products with higher technology content that improve fuel economy, reduce emissions and enhance vehicle safety. The company believes that this transformation a fundamental part of our sustainable global profitable growth strategy has and will continue to improve operating performance thereby increasing the company's fair value and overall shareholders' value.

Read the rest of this transcript for free on seekingalpha.com

3 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,563.30 -317.06 -1.88%
S&P 500 1,930.67 -39.40 -2.00%
NASDAQ 4,369.7730 -93.1290 -2.09%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs