TI Fluid Systems' revenues dip as global vehicle production falls

TI Fluid Systems’ confirmed on Thursday that its revenue over the first three quarters fell after a drop off in global light vehicle production.

The first nine months of the year saw a 0.9% drop in total group revenue to £2.6bn as light vehicle production fell in the third quarter following the introduction of new emissions testing standards in Europe and lower consumer demand in China.

However, the London-listed automotive fluid storage manufacturer highlighted that on a constant currency basis revenue increased by 2.6% year-on-year and exceeded the growth in global light vehicle production by 1.8%.

Asia Pacific was the only region with an improvement in revenue, rising 0.8% as positive growth continued in China despite the aforementioned challenges.

Latin America was hit by a 10.5% revenue decrease, North American revenue fell by 2.7% and Europe and Africa dropped 0.2%.

Light vehicle production is forecast to continue flagging for the rest of the year but TI Fluid Systems’ board expects revenue growth to exceed global light vehicle production volume growth, though outperformance is expected to be less than in 2017 at constant currency.

"The group has a successful history of managing volume fluctuations and given our flexible cost profile, we expect our 2018 Adjusted EBIT margin to be broadly in line with 2017 and adjusted free cash flow to be in line with expectations," said a statement from the company.

TI Fluid Systems’ shares were up 1.53% at 212.20p at 1034 GMT.