Martinrea International Inc. rebounded from a tough end to 2020 with net income surging 34.5 per cent in the first quarter on higher revenues.
The auto parts manufacturer says it earned $38.7 million or 48 cents per share, compared with $29 million or 36 cents per share a year earlier.
The adjusted profit was $32.6 million or 41 cents per share, up from $30.1 million or 38 cents per share in the first quarter of 2020.
Revenues for the three months ended March 31 increased 14.3 per cent to $997.2 million from $872.7 million in the prior year.
Martinrea was expected to report an adjusted profit of 39 cents per share on $953.7 million of revenues, according to financial markets data firm Refinitiv.
Chief executive Pat D’Eramo says the company is managing through a substantial amount of new business launches as well as the semiconductor shortage that will continue to impact results in the near term.
“First-quarter results were impacted by some short-term headwinds, including the industry-wide shortage of semiconductors, a temporary lag in the pricing pass-through of higher aluminum costs, and an emerging third wave of COVID-19 which is presenting additional short-term challenges in some locations,” he stated.
D’Eramo said the longer-term outlook is “very solid” as U.S. auto sales have been near record levels in recent months and vehicle inventories are at their lowest levels in decades, especially on SUVs and CUVs that Martinrea supplies.
“We believe this sets the stage for a prolonged period of strong production growth once supply chain pressures ease.”