Delphi Sees Sharp Drop In Earnings

Autoparts Report, Oct 19, 2001

Delphi Automotive Systems met third-quarter profit targets but warned its earnings next quarter will fall short of Wall Street expectations. Delphi said the third quarter was "challenging" because of already weak auto production and sales around the world made worse by the Sept. 11 terrorist attacks.

Troy, Mich.-based Delphi reported a third-quarter profit of $26 million, or 5 cents a share, down 82 percent from $148 million, or 26 cents a share, in the year-ago quarter. The per-share results matched the average consensus of analysts polled Thomson Financial/First Call estimate.

Quarterly revenue came in at $6.2 billion in the quarter, down 6 percent from $6.6 billion in the same period of 2000. Delphi also indicated it expects to cut an additional 1,000 to 1,500 jobs this year. During the third quarter, the company cut 3,700 jobs in the third quarter for a total of 8,500 cuts in 2001.

For the fourth quarter, Delphi forecast revenue of $6.3 billion to $6.5 billion and net income of $30 million to $85 million, or 5 to 15 cents a share. First Call had expected fourth-quarter per-share estimates of 19 cents on revenue of $6.7 billion.