0001171843-19-005312.txt : 20190808 0001171843-19-005312.hdr.sgml : 20190808 20190808135352 ACCESSION NUMBER: 0001171843-19-005312 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20190808 FILED AS OF DATE: 20190808 DATE AS OF CHANGE: 20190808 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MAGNA INTERNATIONAL INC CENTRAL INDEX KEY: 0000749098 STANDARD INDUSTRIAL CLASSIFICATION: MOTOR VEHICLE PARTS & ACCESSORIES [3714] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11444 FILM NUMBER: 191008867 BUSINESS ADDRESS: STREET 1: 337 MAGNA DRIVE STREET 2: N/A CITY: AURORA, ONTARIO, CAN STATE: A6 ZIP: L4G 7K1 BUSINESS PHONE: 9057262462 MAIL ADDRESS: STREET 1: 337 MAGNA DRIVE STREET 2: N/A CITY: AURORA, ONTARIO, CAN STATE: A6 ZIP: L4G 7K1 6-K 1 f6k_080819.htm FORM 6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

 

Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934

 


For the month of August 2019

 

Commission File Number    001-11444

 
MAGNA INTERNATIONAL INC.
(Exact Name of Registrant as specified in its Charter)
 
337 Magna Drive, Aurora, Ontario, Canada L4G 7K1
(Address of principal executive offices)
 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
          Form 20-F [ ]         Form 40-F [X]
 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): _______
 

Note:  Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): _______
 

Note:  Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under  the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K  submission or other  Commission filing on EDGAR.
 

Indicate by check mark whether the registrant, by furnishing the information contained in this Form, is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.               Yes [ ]               No [X]
 

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-_______

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date:   August 8, 2019 MAGNA INTERNATIONAL INC.
  (Registrant)  
       
       
       
  By:  /s/ “Bassem Shakeel”  
    Bassem A. Shakeel  
    Vice-President and Corporate Secretary

 

 

 

 

  

 

 

 

 

 

 

 

EXHIBITS

Exhibit 99Q2 2019 Financial Review

 

 

 

 

 

 

 

 

 

 EX-99 2 exh_99.htm EXHIBIT 99

Exhibit 99

 

FINANCIAL REVIEW OF MAGNA INTERNATIONAL INC. 
(United States dollars in millions, except per share figures) (Unaudited)
Prepared in accordance with U.S. GAAP
                                           
              2017   2018   2019
          Note   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q TOTAL
VEHICLE VOLUME STATISTICS (in millions)                  
North American vehicle volumes (including Mexico)     4.534 4.456 3.979 4.146 17.115   4.414 4.369 4.049 4.196 17.028   4.250 4.277 8.527
                                           
European vehicle volumes:                                  
  Western Europe       4.012 3.830 3.337 3.762 14.941   3.939 4.005 3.005 3.406 14.355   3.741 3.688 7.429
  Eastern Europe       1.880 1.962 1.634 1.956 7.432   1.974 2.070 1.696 2.066 7.806   2.021 2.093 4.114
    Total Europe     5.892 5.792 4.971 5.718 22.373   5.913 6.075 4.701 5.472 22.161   5.762 5.781 11.543
                                           
Asia volumes         12.666 11.534 12.139 14.05 50.389   12.573 12.362 11.758 13.058 49.751   12.074 11.331 23.405
                                           
China volumes         6.79 6.022 6.499 8.414 27.725   6.668 6.641 6.158 7.129 26.596   6.119 5.386 11.505
                                           
Magna Steyr vehicle assembly volumes     0.008 0.021 0.022 0.027 0.078   0.041 0.033 0.034 0.037 0.145   0.046 0.043 0.089
                                           
AVERAGE FOREIGN EXCHANGE RATES                                  
1 Canadian dollar equals U.S. dollars     0.756 0.744 0.798 0.787 0.771   0.790 0.775 0.765 0.756 0.772   0.752 0.748 0.750
1 Euro equals U.S. dollars     1.066 1.101 1.175 1.178 1.130   1.229 1.193 1.163 1.141 1.182   1.135 1.124 1.130
1 Chinese renminbi equals U.S. dollars     0.145 0.146 0.150 0.151 0.148   0.157 0.157 0.147 0.145 0.152   0.148 0.147 0.148
                                           
CONSOLIDATED STATEMENTS OF INCOME                                  
Sales           8,900        9,140        8,864        9,684 36,588   10,792      10,280        9,618      10,137 40,827   10,591      10,126 20,717
                                           
Costs and expenses:                                    
  Cost of goods sold     7,457        7,745        7,488        8,205 30,895   9,293        8,795        8,253        8,714 35,055   9,164        8,710 17,874
  Selling, general and administrative      416           409           406           437 1,668   396           434           403           431 1,664   421           453 874
  Equity income       (67)            (54)            (45)            (87) (253)   (87)            (72)            (62)            (56) (277)   (35)            (48) (83)
                                           
  EBITDA     2   1,094        1,040        1,015        1,129 4,278   1,190        1,123        1,024        1,048 4,385   1,041        1,011 2,052
  Depreciation and amortization     276           282           310           316 1,184   315           320           325           318 1,278   321           334 655
  EBIT     3   818           758           705           813 3,094   875           803           699           730 3,107   720           677 1,397
  Interest expense, net     19             11             20             20 70   21             23             23             26 93   31             14 45
                                           
Operating income    2   799 747 685 793 3,024   854 780 676 704 3,014   689 663 1,352
Other expense (income), net 2   6 3 2 28 39   3 (39) 2 97 63   (679) 68 (611)
Income from operations before income taxes               793           744           683           765        2,985             851           819           674           607        2,951          1,368           595        1,963
Income taxes         206           183           162           190 741   182           183           114           140 619   267           145 412
                                           
Net income         587           561           521           575 2,244   669           636           560           467 2,332   1,101           450 1,551
Income attributable to non-controlling interests     (10)            (13)              (9)            (16) (48)   (9)            (10)              (6)            (11) (36)   5               2 7
Net income attributable to Magna International Inc.     577 548 512 559 2,196   660 626 554 456 2,296   1,106 452 1,558
                                           
                                           
Adjusted net income attributable to Magna International Inc. 2   583 551 514 571 2,219   663 590 535 542 2,330   531 509 1,040
                                           
Diluted earnings per share:                                  
  Diluted          $      1.51  $      1.44  $      1.38  $      1.54  $      5.87    $      1.83  $      1.77  $      1.62  $      1.37  $      6.61    $      3.39  $      1.42  $      4.83
  Adjusted Diluted        $      1.53  $      1.45  $      1.39  $      1.58  $      5.93    $      1.84  $      1.67  $      1.56  $      1.63  $      6.71    $      1.63  $      1.59  $      3.22
                                           
                                           
Weighted average number of Common Shares outstanding                                   
  during the year (in millions):     383.4 379.5 370.4 362.3 373.9   359.9 354.1 343.0 333.2 347.5   326.3 319.5 322.9
                                           
PROFITABILITY RATIOS                                  
  Selling, general and administrative /Sales     4.7% 4.5% 4.6% 4.5% 4.6%   3.7% 4.2% 4.2% 4.3% 4.1%   4.0% 4.5% 4.2%
  EBITDA /Sales       12.3% 11.4% 11.5% 11.7% 11.7%   11.0% 10.9% 10.6% 10.3% 10.7%   9.8% 10.0% 9.9%
  EBIT /Sales         9.2% 8.3% 8.0% 8.4% 8.5%   8.1% 7.8% 7.3% 7.2% 7.6%   6.8% 6.7% 6.7%
  Operating income /Sales     9.0% 8.2% 7.7% 8.2% 8.3%   7.9% 7.6% 7.0% 6.9% 7.4%   6.5% 6.5% 6.5%
  Effective tax rate                                  
    Reported       26.0% 24.6% 23.7% 24.8% 24.8%   21.4% 22.3% 16.9% 23.1% 21.0%   19.5% 24.4% 21.0%
    Excluding Other expense (income), net of taxes     25.8% 24.5% 23.6% 26.0% 25.0%   21.3% 23.1% 20.0% 21.4% 21.5%   23.7% 23.5% 23.6%

 

Page 1 of 6

 

FINANCIAL REVIEW OF MAGNA INTERNATIONAL INC.
CONSOLIDATED BALANCE SHEETS
(United States dollars in millions) (Unaudited)
                                         
              2017     2018     2019
              1st Q 2nd Q 3rd Q 4th Q     1st Q 2nd Q 3rd Q 4th Q     1st Q 2nd Q
ASSETS                       [Note 1]  
Current assets:                                    
  Accounts receivable     6,776        6,852        6,940        6,695     8,073        7,656        7,160        6,548     7,446        7,204
  Inventories         3,242        3,472        3,609        3,542     3,564        3,600        3,580        3,403     3,501        3,521
  Prepaid expenses and other     205           230           225           237     250           201           237           250     275           278
                   10,223      10,554      10,774      10,474          11,887      11,457      10,977      10,201          11,222      11,003
Current liabilities:                                  
  Accounts payable and other accruals     8,603        8,440        8,698        8,876     9,855        9,048        8,847        8,597     9,347        9,048
                                         
Working capital          1,620        2,114        2,076        1,598     2,032        2,409        2,130        1,604     1,875        1,955
Investments                1,844        1,828        1,934        2,079            2,132        2,320        2,337        2,189            2,408        2,334
Fixed assets, net              7,130        7,462        7,741        8,176            8,204        8,026        7,743        8,095            7,958        8,109
Goodwill, other assets and intangible assets     3,390        3,589        3,693        3,775     3,837        3,684        3,467        3,527     3,487        3,593
Operating lease right-of-use assets                   -                 -                 -                 -                     -                 -                 -                 -              1,716        1,744
                   13,984      14,993      15,444      15,628          16,205      16,439      15,677      15,415          17,444      17,735
Net assets held for sale                                -                 -             568           541                   -                 -  
Funds employed              13,984      14,993      15,444      15,628          16,205      16,439      16,245      15,956          17,444      17,735
FINANCING                                    
Straight debt:                                    
  Short-term borrowings     488           868           457           259     262        1,123        1,291        1,098     335           199
  Cash and cash equivalents     (831)          (666)          (783)          (726)     (769)          (626)          (884)          (684)     (925)          (563)
  Long-term debt due within one year     152           138           102           108     114           120           231           201     122           112
  Current portion of operating lease liabilities     -                -                -                -     -                -                -                -     176           214
  Long-term debt       2,394        2,427        3,175        3,195     3,220        3,115        3,112        3,084     3,062        3,071
  Operating lease liabilities                  -                 -                 -                 -                     -                 -                 -                 -               1,566        1,544
                     2,203        2,767        2,951        2,836            2,827        3,732        3,750        3,699            4,336        4,577
Long-term employee benefit liabilities     679           719           739           670     691           659           592           597     598           606
Other long-term liabilities     291           290           248           326     340           314           291           400     396           404
Deferred tax liabilities, net     16             16             46             84     54             86           107           101     167           196
                        986        1,025        1,033        1,080            1,085        1,059           990        1,098            1,161        1,206
Shareholders' equity       10,795      11,201      11,460      11,712     12,293      11,648      11,505      11,159     11,947      11,952
                   13,984      14,993      15,444      15,628          16,205      16,439      16,245      15,956          17,444      17,735
                                                   
ASSET UTILIZATION RATIOS                                
  Days in accounts receivable     68.5 67.5 70.5 62.2     67.3 67.0 67.0 58.1     63.3 64.0
  Days in accounts payable     103.8 98.1 104.5 97.4     95.4 92.6 96.5 88.8     91.8 93.5
  Inventory turnover - cost of sales     9.2 8.9 8.3 9.3     10.4 9.8 9.2 10.2     10.5 9.9
  Working capital turnover      22.0 17.3 17.1 24.2     21.2 17.1 18.1 25.3     22.6 20.7
  Total asset turnover      2.5 2.4 2.3 2.5     2.7 2.5 2.5 2.6     2.4 2.3
                                         
CAPITAL STRUCTURE                                
  Straight debt       15.8% 18.5% 19.1% 18.1%     17.4% 22.7% 23.1% 23.2%     24.9% 25.8%
  Long-term employee benefit liabilities, other long-term                                
    liabilities & deferred tax liabilities, net     7.0% 6.8% 6.7% 6.9%     6.6% 6.4% 6.1% 6.9%     6.7% 6.8%
  Shareholders' equity      77.2% 74.7% 74.2% 74.9%     75.9% 70.9% 70.8% 69.9%     68.5% 67.4%
              100.0% 100.0% 100.0% 100.0%     100.0% 100.0% 100.0% 100.0%     100.0% 100.0%
                                         
  Debt to total capitalization      21.9% 23.5% 24.6% 23.3%     22.6% 27.2% 28.7% 28.2%     30.6% 30.1%
ANNUALIZED RETURNS                                
  Return on assets (EBIT/assets employed)     23.4% 20.2% 18.3% 20.8%     21.6% 19.5% 17.8% 18.9%     16.5% 15.3%
  Return on equity (Net income attributable to Magna                                
    International Inc. / Average shareholders' equity)     22.0% 19.9% 18.1% 19.3%     22.0% 20.9% 19.1% 16.1%     38.3% 15.1%
  Adjusted Return on equity (Adjusted Net income attributable                                
     to Magna International Inc. / Average shareholders' equity)   22.2% 20.0% 18.2% 19.7%     22.1% 19.7% 18.5% 19.1%     18.4% 17.0%

 

Page 2 of 6

 

FINANCIAL REVIEW OF MAGNA INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(United States dollars in millions) (Unaudited)
                                           
              2017   2018   2019
Cash provided from (used for): Note   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q TOTAL
                           
Operating activities                                    
  Net income                   587           561           521           575        2,244             669           636           560           467        2,332          1,101           450        1,551
  Items not involving current cash flows               274           373           352           316        1,315             363           303           339           534        1,539            (213)           470           257
                        861           934           873           891        3,559          1,032           939           899        1,001        3,871             888           920        1,808
  Changes in operating assets and liabilities              (404)          (376)               9           558          (213)            (455)          (472)           177           597          (153)            (294)               -            (294)
                                           
Cash provided from operating activities               457           558           882        1,449        3,346             577           467        1,076        1,598        3,718             594           920        1,514
                                                 
Investment activities                                          
  Fixed asset additions               (323)          (421)          (380)          (751)       (1,875)            (243)          (379)          (381)          (647)       (1,650)            (251)          (328)          (579)
  Investment in Lyft, Inc.                   -                 -                 -                 -                 -                   -            (200)            (20)               -            (220)                 -                 -                 -  
  Increase in investments, other assets and intangible assets              (83)          (143)          (158)          (267)          (651)            (114)          (103)          (114)          (150)          (481)              (82)          (107)          (189)
  Proceeds from disposition               142             14             71           105           332               29             48             76             70           223               86             26           112
  Acquisitions                       -                 -                 -                 -                 -                   -                 4               -            (152)          (148)                 -            (152)          (152)
  Proceeds on disposal of facilities                   -                 -                 -               49             49                 -                 -                 -                 -                 -                   -                 -                 -  
  Sale of Fluid Pressure & Controls Business ["FP&C"]                   -                 -                 -                 -                 -                   -                 -                 -                 -                 -            1,129               -          1,129
                                                 
Cash provided from (used for) investment activities              (264)          (550)          (467)          (864)       (2,145)            (328)          (630)          (439)          (879)       (2,276)             882          (561)           321
                                                 
Financing activities                                          
  Net issues (repayments) of debt              (145)           313           141          (197)           112                 3           886           262          (284)           867            (855)          (187)       (1,042)
  Common Shares issued on exercise of stock options                   6               5               9             24             44                 5             41               1               3             50                 8               6             14
  Repurchase of Common Shares              (100)          (383)          (422)          (366)       (1,271)            (103)          (729)          (520)          (479)       (1,831)            (284)          (409)          (693)
  Shares repurchased for tax withholdings on vesting of equity awards               -                 -                 -              (11)            (11)                 -                (2)              (4)            (10)            (16)                (3)              (2)              (5)
  Contributions to subsidiaries by non-controlling interests                   -               10               -                 -               10                 -                 4               -                 -                 4                 2               -                 2
  Dividends paid to non-controlling interests                   -                (7)            (26)              (5)            (38)                 -              (30)               -              (39)            (69)                 -              (13)            (13)
  Dividends paid                (105)          (101)            (99)            (95)          (400)            (118)          (115)          (109)          (106)          (448)            (119)          (110)          (229)
                                                 
Cash (used for) provided from financing activities              (344)          (163)          (397)          (650)       (1,554)            (213)             55          (370)          (915)       (1,443)         (1,251)          (715)       (1,966)
Effect of exchange rate changes on cash, cash equivalents                                        
  and restricted cash equivalents                 11               3               1               9             24               10            (31)            (10)              (5)            (36)               14              (4)             10
Net increase (decrease) in cash, cash equivalents                                  
  and restricted cash equivalents during the period              (140)          (152)             19            (56)          (329)               46          (139)           257          (201)            (37)             239          (360)          (121)
Cash, cash equivalents and restricted cash equivalents,                                  
  beginning of period 4          1,168        1,028           876           895        1,168             839           885           746        1,003           839             802        1,041           802
Cash, cash equivalents and restricted cash equivalents,                                        
  end of period              1,028           876           895           839           839             885           746        1,003           802           802          1,041           681           681

 

Page 3 of 6

 

FINANCIAL REVIEW OF MAGNA INTERNATIONAL INC.
(United States dollars in millions, except per share figures) (Unaudited)
     
    This Analyst should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2018.
   
Note 1:  LEASES ADOPTION
    On January 1, 2019, the Company adopted ASC 842, Leases using the modified retrospective transition approach, without restatement of comparative periods' financial information. The adoption requires the Company to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets.
                                             
Note 2: NON-GAAP MEASURES
    The Company presents Operating income, EBIT (Earnings before interest and taxes) and EBITDA (Earnings before interest, taxes and depreciation and amortization) before Other expense (income),net.  The Company also presents Adjusted Net Income (Net Income before Other expense (income),net , net of tax and excluding significant income tax valuation allowance adjustments), Adjusted Diluted Earnings per Share, Gross margin as a percentage of sales, Adjusted EBIT and Adjusted EBIT as a percentage of sales, Return on Invested Capital and Return on Equity.  The Company presents these financial figures because such measures are widely used by analysts and investors in evaluating the operating performance of the Company.  However, such measures do not have any standardized meaning under U.S. generally accepted accounting principles and may not be comparable to the calculation of similar measures by other companies. Other expense (income), net consists of:
                                             
              2017   2018   2019  
              1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q TOTAL  
                                             
    Gain on the sale of FP&C [a]   - - - - -   - - - - -   (516) (6) (522)  
    Unrealized (gain) loss on investment revaluations [b]   - - - - -   - (56) - - (56)   (177) 67 (110)  
    Restructuring charges [c]   6 3 2 18 29   3 17 2 23 45   14 7 21  
    Impairment charges [d]   - - - 81 81   - - - 74 74   - - -  
    Gain on formation of a new venture [e]   - - - (45) (45)   - - - - -   - - -  
    Gain on sale of investment [f]   - - - (26) (26)   - - - - -   - - -  
                                             
              6               3               2             28             39   3            (39)               2             97             63   (679)             68          (611)  
                                             
    [a] Gain on the sale of FP&C
    In Power & Vision, during the first quarter of 2019, the Company recorded a gain on the sale of the FP&C business of $516 million, and in the second quarter recorded an increase in the gain on sale of $6 million as a result of finalizing the proceeds relating to working capital.   
    [b] Unrealized (gain) loss on investment revaluations
    In Corporate, during the first and second quarters of 2019, the Company recorded unrealized gains of $177 million and net unrealized losses of $67 million, respectively, substantially related to its investment in Lyft, Inc.

In Corporate, during the second quarter of 2018, the Company remeasured its private equity investments at fair value, resulting in a $56 million unrealized gain, substantially related to its investment in Lyft, Inc. 
    [c] Restructuring charges
              2017   2018   2019  
              1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q TOTAL  
                                             
    Power & Vision     6 3 2 3 14   3 12 2 3 20   - - -  
    Body Exteriors & Structures     - - - 15 15   - 5 - 20 25   14 7 21  
              6               3               2             18             29   3             17               2             23 45   14               7             21  
    [d] Impairment charges
    In Body Exteriors & Structures, during the fourth quarter of 2018, the Company recorded $14 million of impairment charges for fixed assets. In Power & Vision, during the fourth quarter of 2018, the Company recorded a $60 million impairment charge on investment.

In Body Exteriors & Structures, during the fourth quarter of 2017, the Company recorded $64 million of impairment charges for fixed assets. In Power & Vision, during the fourth quarter of 2017, the Company recorded a $17 million impairment charge on investment.
    [e] Gain on formation of a new venture
    In Seating Systems, the Company recorded a gain of $45 million related to the formation of a new venture.  
    [f] Gain on the sale of investment
    In Corporate, the Company recorded a gain of $26 million on the sale of a cost-based investment.  

 

Page 4 of 6

 

              2017   2018   2019
              1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q TOTAL
                           
                                           
    Net income attributable to Magna International Inc.     577           548           512           559        2,196   660           626           554           456        2,296   1,106           452        1,558
      Exclude:                                   
        Gain on the sale of FP&C     - - - -                -   - - - -                -   (438) (7)          (445)
        Unrealized (gain) loss on investment revaluations   - - - -                -   - (53) - -            (53)   (151) 57            (94)
        Restructuring charges     6 3 2 14             25   3 17 2 21             43   14 7             21
        Impairment charges     -                -                - 81             81   -                -                - 71             71   -                -                -
        Reassessment of deferred tax balances - FP&C [g] - - - -                -   - - (21) -            (21)   - -                -
        Gain on formation of a new venture     - - - (34)            (34)   - - - -                -   - -                -
        Gain on sale of investment     - - - (26)            (26)   - - - -                -   - -                -
        US tax reform     - - - (23)            (23)   - - - 11             11   - -                -
        Adjustment to tax valuation allowance [h]     - - - -                -   -   - (17)            (17)   - -                -
                                      -                  -
    Adjusted net income attributable to Magna International Inc. 583           551           514           571        2,219   663           590           535           542        2,330   531           509        1,040
                                           
                                           
    Diluted earnings per share      $      1.51  $      1.44  $      1.38  $      1.54  $      5.87    $      1.83  $      1.77  $      1.62  $      1.37  $      6.61    $      3.39 1.42  $      4.83
      Exclude:                                  
        Gain on the sale of FP&C     -               -                 -                 -   -   -               -                 -                 -   -   (1.34)         (0.02) (1.38)
        Unrealized (gain) loss on investment revaluations   -               -                 -                 -   -   -         (0.15)               -                 -   (0.15)   (0.46)          0.17 (0.29)
        Restructuring charges     0.02          0.01          0.01          0.04 0.06   0.01          0.05               -            0.06 0.12   0.04          0.02 0.06
        Impairment charges     -               -                 -            0.22 0.22   -               -                 -            0.22 0.21   -               -   -
        Reassessment of deferred tax balances - FP&C [g] -               -                 -                 -   -   -               -           (0.06)               -   (0.06)   -               -   -
        Gain on formation of a new venture     -               -                 -           (0.09) (0.09)   -               -                 -                 -   -   -               -   -
        Gain on sale of investment     -               -                 -           (0.07) (0.07)   -               -                 -                 -   -   -               -   -
        US tax reform     -               -                 -           (0.06) (0.06)   -               -                 -            0.03 0.03   -               -   -
        Adjustment to tax valuation allowance [h]     -               -                 -                 -   -   -               -                 -           (0.05) (0.05)   -               -   -
                                           
    Adjusted diluted earnings per share       $      1.53  $      1.45  $      1.39  $      1.58  $      5.93    $      1.84  $      1.67  $      1.56  $      1.63  $      6.71    $      1.63  $      1.59  $      3.22
    [g] Reassessment of deferred tax balances - FP&C
    Reassessment of deferred tax balances relating to timing differences that reversed on closing of the sale of the global Fluid Pressure & Controls ["FP&C"] business.
    [h] Adjustment to tax valuation allowance
    During the fourth quarter of 2018, the Company released $17 million of the tax valuation allowance in India.

 

Page 5 of 6

 

Note 3: SEGMENTED INFORMATION
     
              2017   2018   2019  
              1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q TOTAL  
    Body Exteriors & Structures Group                    
      Total sales     4,167 4,109 4,004 4,333 16,613   4,619 4,551 4,180 4,177 17,527   4,308 4,243 8,551  
      Adjusted EBIT     349 337 306 354 1,346   343 388 326 356 1,413   363 341 704  
      Adjusted EBIT as a percentage of total sales     8.4% 8.2% 7.6% 8.2% 8.1%   7.4% 8.5% 7.8% 8.5% 8.1%   8.4% 8.0% 8.2%  
                                             
    Power & Vision                                    
      Total sales     2,963 2,892 2,830 2,944 11,629   3,190 3,197 2,947 2,987 12,321   3,083 2,808 5,891  
      Adjusted EBIT     328 266 267 322 1,183   359 299 259 254 1,171   216 201 417  
      Adjusted EBIT as a percentage of total sales     11.1% 9.2% 9.4% 10.9% 10.2%   11.3% 9.4% 8.8% 8.5% 9.5%   7.0% 7.2% 7.1%  
                                             
    Seating Systems                                    
      Total sales     1,335 1,367 1,217 1,305 5,224   1,470 1,424 1,219 1,435 5,548   1,433 1,452 2,885  
      Adjusted EBIT     116 117 95 106 434   130 117 69 110 426   94 83 177  
      Adjusted EBIT as a percentage of total sales     8.7% 8.6% 7.8% 8.1% 8.3%   8.8% 8.2% 5.7% 7.7% 7.7%   6.6% 5.7% 6.1%  
                                             
    Complete Vehicles                                    
      Total sales     527 869 938 1,213 3,547   1,660 1,280 1,391 1,687 6,018   1,928 1,802 3,730  
      Adjusted EBIT     6 15 17 28 66   19 1 24 24 68   28 43 71  
      Adjusted EBIT as a percentage of total sales     1.1% 1.7% 1.8% 2.3% 1.9%   1.1% 0.1% 1.7% 1.4% 1.1%   1.5% 2.4% 1.9%  
                                             
    Corporate and other                                    
      Intercompany fees     (92) (97) (125) (111) (425)   (147) (172) (119) (149) (587)   (161) (179) (340)  
      Adjusted EBIT     19 23 20 3 65   24 (2) 21 (14) 29   19 9 28  
                                             
    Total                                        
      Total sales     8,900 9,140 8,864 9,684 36,588   10,792 10,280 9,618 10,137 40,827   10,591 10,126 20,717  
      Adjusted EBIT     818 758 705 813 3,094   875 803 699 730 3,107   720 677 1,397  
      Adjusted EBIT as a percentage of total sales     9.2% 8.3% 8.0% 8.4% 8.5%   8.1% 7.8% 7.3% 7.2% 7.6%   6.8% 6.7% 6.7%  
                                             
Note 4: CASH, CASH EQUIVALENTS AND RESTRICTED CASH EQUIVALENTS
                                             
    A reconciliation of Cash and cash equivalents and Restricted cash equivalents (included in prepaid expenses) to Total cash, cash equivalents and restricted cash equivalents is as follows:
                                             
              2017     2018     2019    
              1st Q 2nd Q 3rd Q 4th Q     1st Q 2nd Q 3rd Q 4th Q     1st Q 2nd Q    
                                             
    Cash and cash equivalents     (831) (666) (783) (726)     (769) (626) (884) (684)     (925) (563)    
    Restricted cash equivalents included in prepaid expenses            (197)          (210)          (112)          (113)     (116) (120) (119) (118)     (116) (118)    
    Total cash, cash equivalents and restricted cash equivalents   (1,028) (876) (895) (839)     (885) (746) (1,003) (802)     (1,041) (681)    

 

 

Page 6 of 6