TI Fluid Systems Q3 revenues dented by chip shortages, supply chain issues

TI Fluid Systems reported a drop in third-quarter revenues on Thursday amid chip shortages and supply chain issues.

Overall group revenue fell 14.4% year-on-year at reported rates, or 14.7% at constant currency, as global light vehicle production volumes continued to be hit by microchip shortages and supply chain disruptions, falling 19.7% compared to the third quarter of last year.

Revenue fell 12.5% in Europe and Africa at constant currency, 20.4% in North America, and 13.1% in Asia Pacific.

For the nine months to 30 September, revenue rose 11.7% at reported rates compared to the same period a year ago, outperforming global light vehicle production growth by 4.2%.

"The group's performance in Q3 2021 reflected lower global light production volumes combined with a high volatility of customer releases," it said. "It is expected that these challenges will continue through year end and into 2022 with global light vehicle production volumes now forecasted to return to pre-Covid levels in 2023.

"Whilst we recognise the ongoing market risks, the group continues to show resilience and expects to finish the year with a robust outperformance of global light vehicle production volume and deliver a high single digit adjusted EBIT margin at, or slightly above, 7%. In addition, our earnings are expected to support the strong adjusted free cash flow generation rate seen historically albeit reflecting the effect of reduced revenue."