Magna International (TSE:MGA) reported a better-than-expected fourth-quarter profit Friday despite headwinds from the General Motors strike, but the company also warned of potential fallout from the coronavirus outbreak.
Magna had net income of $440 million, or an adjusted $1.41 per share, on $9.4 billion in sales. The results handily beat analysts’ expectations of $1.32 per share, according to Barchart.
Nevertheless, Magna had a weaker fourth quarter than in 2018. Sales fell by 7% while net income declined by 3.5% in the fourth quarter of 2019 compared to a year earlier.
Declines in light vehicle sales of 7% in the U.S. and 3% in Europe hit Magna during the quarter.
The company said the 40-day strike by United Auto Workers members at General Motors plants in the U.S. in September and October helped bring down U.S. sales.
Higher margins in Magna’s completed vehicles segment helped offset the declines.
Magna also warned that the coronavirus outbreak could impact auto production volumes. The company has not revised its 2020 earnings outlook, saying that effects on customers’ factories in China were difficult to gauge.
Magna also reported selling $221 million of Lyft (NASDAQ:LYFT) stock during the quarter, realizing gains of $10 million. The company announced in January the end of its partnership with the U.S. ride-sharing company on the joint development of autonomous vehicle technology.
