TI Fluid Systems outperforms global light vehicle market in third quarter

The FTSE 250 firm said that represented a “solid outperformance” of global light vehicle production in the third quarter of 2.2%.

Revenue for the nine months ended 30 September totalled €2.52bn (£2.17bn), despite a 5.9% decline in global light vehicle production.

On a constant currency basis, revenue was 3.9%, but still outperformed global light vehicle production by 2.0%.

By region, on a constant currency basis, Europe and Africa revenue was up 2.8% and Asia Pacific revenue was flat year-on-year.

The rate of decline in North America narrowed to 7.7% from 8.1% in the first half, the board said, but was still impacted by mix and last year's strong comparable period.

By division, FCS revenue fell 4.8% for the quarter, and showed a “solid improvement” against the first half of the year, while FTDS revenue increased 4.4% in the quarter, benefitting from business launches including tooling revenue.

Looking at the first nine months of the year, in Europe and Africa, revenue decreased 2.0% at constant currency and outperformed light vehicle production volume in that region by 4.5%, which the board said was primarily driven by strong tooling revenue in FTDS in advance of expected new business launches.

Asia Pacific revenue was down 3.2% at constant currency and outperformed light vehicle production volume in that region by 3.8%.

“Outperformance was primarily through continued new business success with our fuel tanks in FTDS, particularly in China, where the group is benefiting from the automotive megatrends of reduced evaporative emissions and fuel efficiency,” the board said in its statement.

In North America, revenue decreased 8.0% at constant currency, or 5.8% below light vehicle production volume in that region.

“Revenue was impacted by lower launch activity in North America compared with the prior period as well as mix with the group's lower exposure to SUVs [and] light truck programmes in this region.”

On a segmental basis for the first nine months, FCS revenue decreased 8.0% at constant currency and was impacted by the lower production in China and mix in North America.

FTDS revenue grew 2.0% at constant currency, and the board said the company continued to benefit from new business wins in Asia Pacific, as well as increased tooling revenue in Europe.

“The 2019 outlook for the group, provided in the half-year results announcement on 8 August, remains unchanged,” the board added.

At 0821 GMT, shares in TI Fluid Systems were up 6.95% at 215.5p.