By Soyoung Kim
DETROIT (Reuters) - TRW Automotive Holdings Corp
But shares of TRW rose 10 percent as its loss excluding items was smaller than expected and after it announced stepped-up restructuring actions in response to the deep industry downturn.
TRW has frozen salaries and new hiring, and said it planned additional job cuts and facility closures, after slashing 10,000 positions last year, or 13 percent of its global workforce.
From automakers to their parts suppliers and dealership groups, the slump in vehicle sales to levels unseen in more than 25 years has prompted job cuts, plant closures and decreases in capital spending.
Economic weakness drove U.S. light-vehicle sales down 18 percent to 13.2 million units last year, and analysts and executives have forecast a further decline to as low as 10 million units for 2009.
"You'd have to go back to 1982 to find a period where production was less than 10 million units, and if this production was population adjusted, then this industry recession is clearly far worse than that," TRW Chief Executive John Plant said on a conference call.
Chief Financial Officer Joe Cantie said the company, which had $1.5 billion in available liquidity at the end of 2008, is in compliance with its key financial covenants, but said he was not certain whether it would continue to remain in compliance throughout 2009.
TRW, which produces safety equipment such as airbags and electronic stability controls, reported a fourth-quarter net loss of $946 million, or $9.35 per share, compared with a year-earlier net profit of $56 million, or 55 cents per share.
Excluding one-time items, TRW lost 73 cents per share in the quarter, vs. a profit of 59 cents a year earlier.
On that basis, analysts on average had expected a loss per share of $1.41, according to KeyBanc analyst Brett Hoselton.
Sales fell 28 percent to $2.8 billion.
TRW expects 2009 sales of $10.9 billion to $11.3 billion, down from $15 billion last year.
First-quarter sales could drop about 41 percent to $2.4 billion, the company said.
Auto parts suppliers have come under intense pressure from tight credit conditions and from a prolonged downturn in consumer demand that has prompted major automakers to slash output.
TRW expects industrywide vehicle production volumes to decline 50 percent in North America and 40 percent in Western Europe in the first quarter.
Shares of the company were up 24 cents, or 10 percent, at $2.62 on the New York Stock Exchange.
(Editing by Dave Zimmerman)
