Magna feels the pressure from bridge closure as auto sector’s losses climb
Advertisement
Read this article for free:
or
Already have an account? Log in here »
We need your support!
Local journalism needs your support!
As we navigate through unprecedented times, our journalists are working harder than ever to bring you the latest local updates to keep you safe and informed.
Now, more than ever, we need your support.
Starting at $15.99 plus taxes every four weeks you can access your Brandon Sun online and full access to all content as it appears on our website.
Subscribe Nowor call circulation directly at (204) 727-0527.
Your pledge helps to ensure we provide the news that matters most to your community!
To continue reading, please subscribe:
Add Brandon Sun access to your Free Press subscription for only an additional
$1 for the first 4 weeks*
*Your next subscription payment will increase by $1.00 and you will be charged $20.00 plus GST for four weeks. After four weeks, your payment will increase to $24.00 plus GST every four weeks.
Read unlimited articles for free today:
or
Already have an account? Log in here »
Hey there, time traveller!
This article was published 11/02/2022 (1421 days ago), so information in it may no longer be current.
AURORA, ONT. – Canadian auto parts manufacturer Magna International Inc. says it is beginning to feel the impact of the Ambassador Bridge blockades on its business.
On a conference call discussing the company’s latest financial results Friday, Magna CEO Seetarama Kotagiri said some customers have had to idle or adjust production schedules as a result of the bridge closure.
“We’re watching it closely and definitely hope it gets resolved quickly,” he said.
Magna shares fell as much as 5.4 per cent in early trading on the news, though they pared losses slightly to sit down $4.64 or 4.5 per cent at $98.41 in midafternoon trading.
The Ambassador Bridge closure has cost an estimated $600 million in damages to the automotive industry so far, according to the Automotive Parts Manufacturers’ Association, which filed a motion against the protestors on Thursday.
Other Canadian businesses are calling on elected representatives to take steps to put an end to the blockades in an open letter released this afternoon and signed by more than 170 industry groups and chambers of commerce.
“The blockades not only strike against the rule of law that protects our rights and freedoms, but also undermine Canada’s international reputation,” the letter states.
In addition to the pressures stemming from the trucker protests, Magna’s CEO said production for 2022 will continue to be hampered by the ongoing semiconductor supply constraints.
Earlier Friday, Magna reported that its fourth-quarter profit and sales fell compared with a year ago.
The company also raised its dividend. Magna, which keeps its books in U.S. dollars, said it will now pay a quarterly dividend of 45 cents per share, up from 43 cents per share.
The increased payment to shareholders came as it said it earned net income attributable to Magna of US$464 million or US$1.54 per diluted share for the quarter ended Dec. 31. The result compared with a profit of US$738 million or $2.45 per diluted share in the last three months of 2020.
Sales for the quarter totalled US$9.11 billion, down from $10.57 billion a year earlier, as Magna said global light vehicle production fell 17 per cent, driven by the semiconductor chip shortages the industry faced throughout 2021.
On an adjusted basis, Magna said it earned US$1.30 per diluted share in its most recent quarter compared with an adjusted profit of US$2.83 per share in the fourth quarter of 2020.
Analysts on average had expected an adjusted profit of 85 cents per share, according to financial markets data firm Refinitiv.
This report by The Canadian Press was first published Feb. 11, 2022.
Companies in this story: (TSX:MG)