Magna Founder Stronach Steps Down from Board; 3rd-Quarter Profit Jumps
11/08/2012| 07:24am US/Eastern
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By Judy McKinnon
Magna International Inc. (MGA) said Thursday its founder, Frank Stronach, is stepping down from its board, effective immediately.
Mr. Stronach will remain honorary chairman of the Canadian auto-parts giant.
"It has been two years since control of Magna has changed hands and, in that time, I have become involved in numerous activities outside of the automotive industry. One of these activities involves politics in Austria and I do not want my political views to be confused with my role on Magna's board," Mr. Stronach said in a statement.
Separately, Magna said its third-quarter profit nearly quadrupled, helped in part by a gain related to its E-Car Systems Partnership purchase, while sales climbed 6%.
Third-quarter earnings rose to $390 million, or $1.66 a share, from $102 million, or 42 cents, a year earlier. Results in the latest quarter included a gain of 53 cents a share related to the purchase of a stake in Magna E-Car Systems Partnership, while expenses in the year-ago quarter reduced earnings by 52 cents a share.
Stripping out the gain in the latest quarter, results were still ahead of the Thomson Reuters mean estimate of $1.02 a share.
Third-quarter sales rose 6% to $7.41 billion, ahead of the $7.04 billion analysts expected.
The company updated its outlook for the year and now projects 2012 total sales of $30.3 billion to $31.2 billion, ahead of its most recent forecast for $29 billion to $30.5 billion. Complete vehicle assembly sales for the year are forecast at $2.4 billion to $2.6 billion.
Write to Judy McKinnon at judy.mckinnon@dowjones.com
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