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Superior Industries International, Inc. (NYSE:SUP) today announced financial results for the fiscal year and fourth quarter ended December 30, 2012, along with plans to build a new manufacturing facility in Mexico to expand capacity and meet anticipated growth in product demand.
Net income for the full 2012 year amounted to $30.9 million, or $1.13 per diluted share, compared with $67.2 million, or $2.46 per diluted share, in 2011. The net income decline largely reflected a swing to income tax expense of $3.6 million in 2012 from a $25.2 million income tax benefit in 2011.
Net sales for 2012 declined slightly to $821.5 million from $822.2 million in 2011. A 7 percent increase in unit sales volume for 2012 was offset by a reduction in average selling price, primarily due to a decline in aluminum prices. Unit shipments rose to 12.5 million in 2012 from 11.7 million units shipped in the prior year.
Gross profit for 2012 declined to $60.6 million, or 7 percent of net sales, from $67.1 million, or 8 percent of net sales, in 2011. The 2012 gross profit included a $3.5 million non-cash benefit from resolution of a foreign consumption tax issue. The company said the decline in gross profit and margin percentage reflected the impact of higher levels of manufacturing costs, principally labor and maintenance. The increase in manufacturing cost resulted from higher sales volume, as well as equipment reliability and other challenges that reduced operating efficiencies, especially in the older U.S. facilities. The company continued to operate its factories at high utilization rates throughout the year.
“The opportunities and challenges in our business have clarified the next steps to improve our operating returns,” said Steven J. Borick, Chairman, Chief Executive Officer and President. “Superior remains the premier aluminum wheel manufacturer in a healthy and growing North American automotive market. While our operations in Mexico consistently have performed at class-leading levels, it has been evident we are not currently positioned to participate fully in North American market growth. Accordingly, after a thorough evaluation of ways to deploy our capital, we have decided to expand our manufacturing footprint by constructing a new manufacturing facility in Mexico, where significant light vehicle assembly expansion has been announced or already is underway.”