Gentex, One Of The "Hot Growth" Companies, Said It Will Miss 2nd Quarter Targets

Autoparts Report, June 18, 2001

For the third consecutive year, Gentex Corporation, the Zeeland, Michigan-based manufacturer of automatic- dimming rearview mirrors, has been named to Business Week's "Hot Growth Companies" list, which ranks the 100 fastest-growing publicly traded companies.

Gentex's growth is, however, not immune from market conditions. Despite the company's recognition from Business Week, Gentex said its second-quarter earnings will miss estimates. said it expects to post earnings 10% to 15% below Wall Street estimates. Analysts surveyed by Thomson Financial/First Call have a mean estimate for earnings of 24 cents a share.

Gentex also revised downward its unit-shipment growth to 10% from the 15% it forecast in January. It blamed a six- to nine-month delay in an order from a customer.

"While we are not pleased with the fact that this large new program is being pushed out, the business is not lost -- it's only delayed," Gentex Executive Vice President Kenneth LaGrand said in a statement. "The program was delayed due to another supplier's inability to deliver on its part of the program, and is something that was beyond our control." However, Gentex said it expects to announce three mid- size vehicle programs that could start shipping later this summer, adding 250,000 units in incremental business in the initial production model year.

Gentex supplies automakers with night vision safety mirrors that automatically darken to reduce glare from the headlamps of vehicles approaching from the rear. The Company's mirrors also act as an electronic module, containing the displays, interfaces and electronics for additional features such as compass and temperature readouts, microphones, telematics components, light-emitting diode map lamps, remote keyless entry receivers and advanced headlamp control systems.

In the magazine's 17th annual list, which ran in the June 11 issue, Business Week ranks Gentex 72nd overall, up five positions from last year. Business Week lists the company's three- year average sales and earnings increases as 17.0 percent and 26.3 percent, respectively. According to Business Week, the list selection process begins by ranking companies according to their three-year results in sales growth, earnings growth, and return on invested capital.

"It's great to receive this sort of recognition, and our longevity on the Business Week list demonstrates our commitment to maintaining our exceptional growth record," said La Grand. "Gentex really is an anomaly. We're a technology company operating within the automotive industry, and it's this unconventional combination that makes us successful."