Magna Founder Stronach Steps Down from Board; 3rd-Quarter Profit Jumps
11/08/2012| 07:24am US/Eastern
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.
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