Aug 11 (Reuters) – Magna International Inc, reported a higher quarterly profit on increased demand in Europe and Asia, and the Canadian auto parts maker raised its full-year sales forecast for the second time in three months.
Chief Executive Officer Don Walker told analysts on Friday that Magna would still focus on electrified and self-driving vehicles but was not planning to spin off any key units because of this, as other auto suppliers had done.
“At this time, we think we have the right product capabilities,” Walker said.
Magna still has “room” to buy back more stock” after spending $484 million in the second quarter on share repurchases and dividends, he added.
The Aurora, Ontario-based company’s quarterly sales rose nearly 10 percent to $681 million in Asia and climbed about 3 percent to $3.63 billion in Europe.
Sales in North America, the company’s biggest market, increased marginally to $5.37 billion because Magna introduced new programs, even as vehicle production declined.
Walker said he still expected a fairly strong second half of the year for North America, although auto sales have been slowing there.
Still, Magna shares were down almost 2 percent in late morning Toronto trading, and another Canadian parts supplier, Linamar Corp, showed a similar decline. The benchmark Canadian stock index fell 0.4 percent.
Magna, which counts General Motors Co, Volkswagen AG, BMW AG and Ford Motor Co among its biggest customers, now expects 2017 sales of $37.7 billion to $39.4 billion.
The company raised its sales forecast in May to a range of $36.6 billion to $38.3 billion.
Net income attributable to Magna rose marginally to $561 million, or $1.48 per share, in the quarter.
Excluding special items, earnings of $1.49 per share were 2 cents higher than the analysts’ average estimate, according to Thomson Reuters I/B/E/S.
Sales rose 2.5 percent to $9.68 billion, ahead of analysts’ expectations of $9.47 billion.