EX-99.1 2 exh_991.htm EXHIBIT 99.1

Exhibit 99.1

 

FINANCIAL REVIEW OF MAGNA INTERNATIONAL INC. 
(United States dollars in millions, except per share figures) (Unaudited)
Prepared in accordance with U.S. GAAP
                                             
              2019   2020   2021
          Note   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q TOTAL
VEHICLE VOLUME STATISTICS (in millions)                    
North American vehicle volumes (including Mexico)     4.227 4.249 3.909 3.912 16.297   3.777 1.241 3.945 4.040 13.003   3.758 3.221 3.183 10.162
                                             
European vehicle volumes:                                    
  Western Europe       3.719 3.614 2.999 3.285 13.617   2.905 1.171 2.613 3.407 10.096   3.049 2.513 2.036 7.598
  Eastern Europe       2.013 2.063 1.672 1.987 7.735   1.795 0.913 1.663 1.990 6.361   1.854 1.664 1.398 4.916
    Total Europe     5.732 5.677 4.671 5.272 21.352   4.700 2.084 4.276 5.397 16.457   4.903 4.177 3.434 12.514
                                             
Asia volumes         11.851 11.109 10.986 13.050 46.996   8.282 8.445 10.890 13.791 41.408   11.476 10.357 10.070 31.903
                                             
China volumes         6.021 5.480 5.626 7.415 24.542   3.235 5.850 6.281 8.129 23.495   6.071 5.686 5.544 17.301
                                             
Magna Steyr vehicle assembly volumes     0.046 0.043 0.035 0.034 0.158   0.031 0.017 0.027 0.035 0.110   0.040 0.030 0.023 0.093
                                             
AVERAGE FOREIGN EXCHANGE RATES                                    
1 Canadian dollar equals U.S. dollars     0.752 0.748 0.757 0.758 0.754   0.745 0.722 0.751 0.767 0.746   0.790 0.814 0.794 0.799
1 Euro equals U.S. dollars     1.135 1.124 1.112 1.107 1.119   1.102 1.101 1.170 1.192 1.141   1.205 1.206 1.178 1.196
1 Chinese renminbi equals U.S. dollars     0.148 0.147 0.142 0.142 0.145   0.143 0.141 0.145 0.151 0.145   0.154 0.155 0.155 0.155
                                             
CONSOLIDATED STATEMENTS OF INCOME (LOSS)                                    
Sales:                                          
    Body Exteriors & Structures      4,308        4,243        3,984        3,923 16,458   3,676        1,623        3,858        4,393 13,550   4,025        3,647        3,185 10,857
    Power & Vision     3,083        2,808        2,696        2,725 11,312   2,523        1,298        2,722        3,179 9,722   3,156        2,881        2,501 8,538
    Seating Systems     1,433 1,452 1,266 1,426 5,577   1,261 524 1,280 1,390 4,455   1,303 1,166 1,123 3,592
    Complete Vehicles     1,928 1,802 1,516 1,461 6,707   1,321 933 1,402 1,759 5,415   1,850 1,490 1,255 4,595
    Corporate & Other     (161) (179) (143) (140) (623)   (124) (85) (133) (153) (495)   (155) (150) (145) (450)
Sales           10,591      10,126        9,319        9,395 39,431   8,657        4,293        9,129      10,568 32,647   10,179        9,034        7,919 27,132
                                             
Costs and expenses:                                      
  Cost of goods sold     9,164        8,710        8,063        8,085 34,022   7,567        4,206        7,681        8,753 28,207   8,662        7,728        6,885 23,275
  Selling, general and administrative      421           453           400           423 1,697   381           378           380           448 1,587   430           419           454 1,303
  Equity income       (35)            (48)            (37)            (58) (178)   (30)            (25)            (44)            (90) (189)   (47)            (44)            (34) (125)
  EBITDA     1   1,041        1,011           893           945 3,890   739          (266)        1,112        1,457 3,042   1,134           931           614 2,679
  Depreciation and amortization     321           334           335           355 1,345   336           334           334           362 1,366   364           374           385 1,123
  EBIT     2   720           677           558           590 2,545   403          (600)           778        1,095 1,676   770           557           229 1,556
  Interest expense, net     31             14             18             19 82   17             21             26             22 86   23             11             22 56
Operating income (loss) 1   689 663 540 571 2,463   386 (621) 752 1,073 1,590   747 546 207 1,500
Other expense (income), net 1   (679) 68 859 (8) 240   - 168 316 100 584   (58) 6 180 128
Income (loss) from operations before income taxes            1,368           595          (319)           579        2,223             386          (789)           436           973        1,006             805           540             27        1,372
Income tax expense (benefit)     267           145             45           134 591   134          (137)           109           223 329   183           104             10 297
Net income (loss)       1,101           450          (364)           445 1,632   252          (652)           327           750 677   622           436             17 1,075
(Income) loss attributable to non-controlling interests 1   5               2           131              (5) 133   9               5             78            (12) 80   (7)            (12)              (6) (25)
Net income (loss) attributable to Magna International Inc.     1,106 452 (233) 440 1,765   261 (647) 405 738 757   615 424 11 1,050
                                             
                                             
Adjusted net income (loss) attributable to Magna International Inc. 1   531 509 438 433 1,911   261 (511) 585 851 1,186   566 426 170 1,162
                                             
Diluted earnings (loss) per share:                                    
  Diluted          $      3.39  $      1.42  $ (0.75)  $      1.43  $      5.59    $      0.86  $     (2.17)  $      1.35  $      2.45  $      2.52    $      2.03  $      1.40  $      0.04  $      3.46
  Adjusted Diluted        $      1.63  $      1.59  $ 1.41  $      1.41  $      6.05    $      0.86  $     (1.71)  $      1.95  $      2.83  $      3.95    $      1.86  $      1.40  $      0.56  $      3.83
                                             
                                             
Weighted average number of Common Shares outstanding                                     
  during the year (in millions):     326.3 319.5 310.7 306.3 315.8   302.7 298.4 299.4 300.9 300.4   303.6 303.6 302.6 303.2
                                             
PROFITABILITY RATIOS                                    
  Cost of goods sold / Total sales     86.5% 86.0% 86.5% 86.1% 86.3%   87.4% 98.0% 84.1% 82.8% 86.4%   85.1% 85.5% 86.9% 85.8%
  Gross margin (before depreciation) / Total sales     13.5% 14.0% 13.5% 13.9% 13.7%   12.6% 2.0% 15.9% 17.2% 13.6%   14.9% 14.5% 13.1% 14.2%
  Selling, general and administrative /Sales     4.0% 4.5% 4.3% 4.5% 4.3%   4.4% 8.8% 4.2% 4.2% 4.9%   4.2% 4.6% 5.7% 4.8%
  EBITDA /Sales       9.8% 10.0% 9.6% 10.1% 9.9%   8.5% -6.2% 12.2% 13.8% 9.3%   11.1% 10.3% 7.8% 9.9%
  EBIT /Sales         6.8% 6.7% 6.0% 6.3% 6.5%   4.7% -14.0% 8.5% 10.4% 5.1%   7.6% 6.2% 2.9% 5.7%
  Operating income(loss) /Sales     6.5% 6.5% 5.8% 6.1% 6.2%   4.5% -14.5% 8.2% 10.2% 4.9%   7.3% 6.0% 2.6% 5.5%
  Effective tax rate                                    
    Reported       19.5% 24.4% -14.1% 23.1% 26.6%   34.7% 17.4% 25.0% 22.9% 32.7%   22.7% 19.3% 37.0% 21.6%
    Excluding Other expense (income), net of taxes     23.7% 23.5% 19.6% 23.3% 22.7%   34.7% 16.9% 22.6% 19.6% 25.7%   23.3% 19.8% 15.0% 20.9%

 

 

Q3 2021 Financial Review of Magna International Inc.Page 1 of 6 

 

 

FINANCIAL REVIEW OF MAGNA INTERNATIONAL INC.
CONSOLIDATED BALANCE SHEETS
(United States dollars in millions) (Unaudited)
                                             
              2019     2020     2021  
              1st Q 2nd Q 3rd Q 4th Q     1st Q 2nd Q 3rd Q 4th Q     1st Q 2nd Q 3rd Q  
FUNDS EMPLOYED       [Note 1]                              
Current assets:                                        
  Accounts receivable     7,446        7,204        7,068        5,927     5,684        5,253        6,618        6,394     7,176        6,531        6,082  
  Inventories         3,501        3,521        3,457        3,304     3,531        3,503        3,509        3,444     3,645        3,999        4,150  
  Prepaid expenses and other     222           244           189           238     234           216           196           260     290           294           247  
                   11,169      10,969      10,714        9,469            9,449        8,972      10,323      10,098          11,111      10,824      10,479  
Current liabilities:                                      
  Accounts payable     6,484        6,272        5,966        5,628     5,635        4,243        5,808        6,266     6,787        6,248        5,914  
  Accrued salaries and wages     860           757           797           753     807           691           851           815     897           912           893  
  Other accrued liabilities     2,003        2,019        1,994        1,800     1,921        2,058        2,246        2,254     2,298        2,186        2,070  
  Income taxes payable (receivable)     (53)            (34)            (22)             17     18            (87)            (69)             38     109           123           125  
              9,294        9,014        8,735        8,198     8,381        6,905        8,836        9,373     10,091        9,469        9,002  
                                             
Working capital          1,875        1,955        1,979        1,271     1,068        2,067        1,487           725     1,020        1,355        1,477  
                                             
Investments                2,408        2,334        1,430        1,210            1,336        1,336        1,143           947               960        1,124        1,455  
Fixed assets, net              7,958        8,109        7,943        8,260            7,948        7,860        7,898        8,475            8,305        8,297        8,166  
Goodwill, other assets and intangible assets     3,487        3,593        3,461        3,456     3,340        3,362        3,423        3,539     3,614        3,632        3,530  
Operating lease right-of-use assets            1,716        1,744        1,702        1,811            1,788        1,777        1,787        1,906            1,869        1,854        1,731  
Funds employed              17,444      17,735      16,515      16,008          15,480      16,402      15,738      15,592          15,768      16,262      16,359  
FINANCING                                        
Straight debt:                                        
  Cash and cash equivalents     (925)          (563)          (769)       (1,276)     (1,146)          (533)       (1,498)       (3,268)     (3,464)       (3,426)       (2,748)  
  Short-term borrowings     335           199           436                -     -           188                -                -     -                -                -  
  Long-term debt due within one year     122           112           104           106     93           150             98           129     137           117           101  
  Long-term debt       3,062        3,071        3,021        3,062     3,021        3,771        3,832        3,973     3,935        3,941        3,908  
  Current portion of operating lease liabilities     176           214           218           225     218           221           226           241     244           278           269  
  Operating lease liabilities     1,566        1,544        1,527        1,601            1,586        1,577        1,582        1,656            1,613        1,563        1,438  
                     4,336        4,577        4,537        3,718            3,772        5,374        4,240        2,731            2,465        2,473        2,968  
Long-term employee benefit liabilities     598           606           584           677     659           675           696           729     733           743           716  
Other long-term liabilities     396           404           388           371     420           390           305           332     414           482           466  
Deferred tax liabilities, net     167           196           133           111     87             10             87             80     104           124             40  
                     1,161        1,206        1,105        1,159            1,166        1,075        1,088        1,141            1,251        1,349        1,222  
Shareholders' equity       11,947      11,952      10,873      11,131     10,542        9,953      10,410      11,720     12,052      12,440      12,169  
                   17,444      17,735      16,515      16,008          15,480      16,402      15,738      15,592          15,768      16,262      16,359  
                                                       
                                             
                                             
ASSET UTILIZATION RATIOS                                    
  Days in accounts receivable     63.3 64.0 68.3 56.8     59.1 110.1 65.2 54.5     63.4 65.1 69.1  
  Days in accounts payable     63.7 64.8 66.6 62.6     67.0 90.8 68.1 64.4     70.5 72.8 77.3  
  Inventory turnover - cost of sales     10.5 9.9 9.3 9.8     8.6 4.8 8.8 10.2     9.5 7.7 6.6  
  Working capital turnover      22.6 20.7 18.8 29.6     32.4 8.3 24.6 58.3     39.9 26.7 21.4  
  Total asset turnover      2.4 2.3 2.3 2.3     2.2 1.0 2.3 2.7     2.6 2.2 1.9  
                                             
CAPITAL STRUCTURE                                    
  Straight debt       24.9% 25.8% 27.5% 23.2%     24.4% 32.8% 26.9% 17.5%     15.6% 15.2% 18.1%  
  Long-term employee benefit liabilities, other long-term                                    
    liabilities & deferred tax liabilities, net     6.6% 6.8% 6.7% 7.2%     7.5% 6.6% 6.9% 7.3%     7.9% 8.3% 7.5%  
  Shareholders' equity      68.5% 67.4% 65.8% 69.5%     68.1% 60.7% 66.1% 75.2%     76.4% 76.5% 74.4%  
              100.0% 100.0% 100.0% 100.0%     100.1% 100.0% 100.0% 100.0%     100.0% 100.0% 100.0%  
                                             
  Debt to total capitalization      30.6% 30.1% 32.8% 31.0%     31.8% 37.2% 35.5% 33.9%     33.0% 32.2% 32.0%  
                                             
ANNUALIZED RETURNS                                    
  Return on assets (EBIT/assets employed)     16.5% 15.3% 13.5% 14.7%     10.4% -14.6% 19.8% 28.1%     19.5% 13.7% 5.6%  
  Return on equity (Net income attributable to Magna                                    
    International Inc. / Average shareholders' equity)     38.3% 15.1% -8.2% 16.0%     9.6% -25.3% 15.9% 26.7%     20.7% 13.8% 0.4%  
  Adjusted Return on equity (Adjusted Net income attributable                                    
     to Magna International Inc. / Average shareholders' equity)     18.4% 17.0% 15.4% 15.7%     9.6% -19.9% 23.0% 30.8%     19.0% 13.9% 5.5%  
                                             

 

Q3 2021 Financial Review of Magna International Inc.Page 2 of 6 

 

 

FINANCIAL REVIEW OF MAGNA INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(United States dollars in millions) (Unaudited)
                                             
              2019   2020   2021
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 3rd Q TOTAL
                             
Operating activities                                      
  Net income (loss)            1,101           450          (364)           445        1,632             252          (652)           327           750           677             622           436             17        1,075
  Items not involving current cash flows (i)            (235)           431        1,188           486        1,870             344           335           749           548        1,976             349           341           515        1,205
          (i)             866           881           824           931        3,502             596          (317)        1,076        1,298        2,653             971           777           532        2,280
  Changes in operating assets and liabilities (i)            (272)             39            (74)           765           458               43          (915)           536           961           625            (310)          (249)          (132)          (691)
                                             
Cash provided from (used for) operating activities               594           920           750        1,696        3,960             639       (1,232)        1,612        2,259        3,278             661           528           400        1,589
                                                   
Investment activities                                            
  Fixed asset additions               (251)          (328)          (349)          (513)       (1,441)            (203)          (169)          (213)          (560)       (1,145)            (212)          (277)          (334)          (823)
  Increase in equity method investment                   -                 -                 -                 -                 -                   -                 -                 -                 -                 -                   -                 -            (454)          (454)
  Increase in investments, other assets and intangible assets                (77)          (102)            (83)          (122)          (384)              (93)            (72)            (68)            (98)          (331)            (104)            (93)          (101)          (298)
  Funding provided on sale of business 1 (e)                  -                 -                 -                 -                 -                   -                 -                 -                 -                 -                   -                 -              (41)            (41)
  Increase in public and private equity investments                  (5)              (5)               -                 -              (10)            (100)              (2)            (12)            (18)          (132)                (3)            (17)              (3)            (23)
  Settlement of long-term receivable from non-consolidated joint venture                 -                 -                 -                 -                 -                   -                 -                 -                 -                 -                 50               -                 -               50
  Proceeds from disposition                 86             26             57             16           185               23             11             14             69           117               19             20             10             49
  Business combinations                   -            (152)               -                 5          (147)                (7)               -                 -               98             91               39            (21)               -               18
  Proceeds from sale of (Investment in) Lyft, Inc.                   -                 -               10           221           231                 -                 -                 -                 -                 -                   -                 -                 -                 -  
  Sale of Fluid Pressure & Controls Business ["FP&C"]            1,129               -                 3               -          1,132                 -                 -                 -                 -                 -                   -                 -                 -                 -  
Cash (used for) provided from investment activities               882          (561)          (362)          (393)          (434)            (380)          (232)          (279)          (509)       (1,400)            (211)          (388)          (923)       (1,522)
                                                   
Financing activities                                            
  Net issues (repayments) of debt              (855)          (187)           251          (435)       (1,226)                (6)           962          (246)            (27)           683            (126)            (33)            (13)          (172)
  Common Shares issued on exercise of stock options                   8               6             19             11             44                 1               1             15             64             81               83             50               3           136
  Repurchase of Common Shares              (284)          (409)          (342)          (254)       (1,289)            (201)               -                (2)               -            (203)            (162)            (99)              (5)          (266)
  Tax withholdings on vesting of equity awards                  (3)              (2)               -                (4)              (9)              (10)               -                 -                (3)            (13)              (12)               -                 -              (12)
  Contributions to subsidiaries by non-controlling interests                   2               -                 2               -                 4                 -                 -                 -               18             18                 -                 -                 -                 -  
  Dividends paid to non-controlling interests                   -              (13)               -                (9)            (22)                (3)              (3)               -              (12)            (18)                 -                (8)              (2)            (10)
  Dividends paid                (119)          (110)          (109)          (111)          (449)            (121)          (116)          (115)          (115)          (467)            (130)          (127)          (130)          (387)
                                                   
Cash provided from (used for) financing activities           (1,251)          (715)          (179)          (802)       (2,947)            (340)           844          (348)            (75)             81            (347)          (217)          (147)          (711)
Effect of exchange rate changes on cash, cash equivalents                                          
  and restricted cash equivalents                 14              (4)              (9)             10             11              (52)               9            (15)             81             23              (13)             39              (8)             18
Net increase (decrease) in cash, cash equivalents                                    
  and restricted cash equivalents during the period               239          (360)           200           511           590            (133)          (611)           970        1,756        1,982               90            (38)          (678)          (626)
Cash, cash equivalents and restricted cash equivalents,                                    
  beginning of period 3             802        1,041           681           881           802          1,392        1,259           648        1,618        1,392          3,374        3,464        3,426        3,374
Cash, cash equivalents and restricted cash equivalents,                                          
  end of period              1,041           681           881        1,392        1,392          1,259           648        1,618        3,374        3,374          3,464        3,426        2,748        2,748
                                             
        (i) Certain amounts in prior periods have been reclassified to conform with current period presentation.  
                                             

 

Q3 2021 Financial Review of Magna International Inc.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, 2020.
                                             
Note 1: 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, Adjusted EBIT and Adjusted EBIT as a percentage of sales, Return on Invested Capital and Return on Equity. The Company calculates Adjusted Debt as total debt adjusted to include pension and lease liabilities and Adjusted EBITDA as earnings before, interest, net, taxes, depreciation and amortization adjusted to add back interest income, certain pension costs and operating lease expense. 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:
                                             
              2019   2020   2021
              1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q TOTAL
                                             
                                             
    Impairments and loss on sale of equity-accounted investments [a]   - - 700 - 700   - - 337 10 347   - - - -
    Restructuring and impairments [b]   14 7 34 3 58   - 168 - 101 269   15 44 24 83
    Net (gains) losses on investments [c]   (177) 67 127 (11) 6   - - (21) (11) (32)   (33) (38) 81 10
    Gain on business combinations [d]   - - - - -   - - - - -   (40) - - (40)
    Net (gains) losses on the sale of business [e]   (516) (6) (2) - (524)   - - - - -   - - 75 75
              (679)             68           859              (8)           240   -           168           316           100           584   (58)               6           180           128
  [a] Impairments and loss on sale of equity-accounted investments                                  
    In the fourth quarter of 2020, the Company recorded a $10 million loss in Power & Vision on the sale of its 50% interest in Dongfeng Getrag Transmission Co. Ltd.

In Power & Vision, during the third quarters of 2020 and 2019, the Company recorded impairment charges of $337 million and $700 million, respectively on equity accounted investments.
     
  [b] Restructuring and impairments                                    
                   
    COVID-19 Restructuring and Impairments:              
    In response to the impact that COVID-19 was expected to have on vehicle production volumes over the short to medium term, the Company initiated and/or accelerated the timing of restructuring plans to right-size its business. These restructuring actions included plant closures and workforce reductions. As a result, in the second quarter of 2020, the Company recorded COVID-19 related restructuring and impairment charges of $115 million in Power & Vision, $37 million in Body Exteriors & Structures, and $16 million in Seating, respectively. 
     
    Impairments:              
    The Company recorded impairments in the fourth quarter of 2020 in the amount of $57 million in Body Exteriors & Structures as well as the second quarter of 2019 in the amount of $27 million in Power & Vision.
     
    Brazil Closures:              
    In the fourth quarter of 2020, in connection with the announced plant closures by Ford Motor Co. in Brazil, the Company made the decision to accelerate the closure and/or restructuring of two facilities in Brazil that supply these plants by recording restructuring and impairments in the amount of $8 million in Body Exteriors & Structures, and $15 million in Seating, respectively.
                   
    India Closures:              
    In the third quarter of 2021,the Company recorded restructuring and impairment charges of $8 million in our Body Exteriors & Structures segment, and $4 million in our Seating Systems segment, primarily related to Ford Motor Company's recently announced plan to exit India.
     
    Other Restructuring:      2019   2020   2021
              1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q TOTAL
    Power & Vision                    -                -                -                -                -                  -                -                -                -                -               15             44               4             63
    Body Exteriors & Structures                 14               7               7               3             31                  -                -                -             21             21                  -                -               8               8
              14               7               7               3             31   -                -                -             21 21   15             44             12 71
                                             

 

 

Q3 2021 Financial Review of Magna International Inc.Page 4 of 6 

 

  [c] Net (gains) losses on investments          
    In Corporate, during the first, second, and third quarters of 2021, the Company recorded gains and losses related to the revaluation of its public and private equity investments and certain public company warrants.

In Corporate, during the third and fourth quarters of 2020, the Company recorded gains related to the revaluation of its private equity investments. In addition, the Company recorded a non-cash impairment charge of $2 million on its private equity investment in Corporate.

In Corporate, during the first, second, third and fourth quarters of 2019, the Company recorded gains and losses related substantially to the revaluation of its investment in Lyft, Inc.
     
  [d] Gain on business combinations                                    
    In Seating Systems, during the first quarter of 2021, the Company recognized a $22 million gain on the on the change in basis of accounting for its previously held equity method investments. In Power & Vision, substantially all of the assets of the Company's European joint venture with Ford Motor Company, Getrag Ford Transmission GmbH, were distributed to either Ford or the Company, which resulted in the Company recording a gain of $18 million.
     
  [e] Net (gains) losses on the sale of business                                    
    During the third quarter of 2021, the Company sold three Body Exteriors & Structures operations in Germany.  Under the terms of the arrangement, the Company provided the buyer with $41 million of funding, subject to working capital adjustments, resulting in a loss on disposal of $75 million [$75 million after tax].

In Power & Vision, during the first quarter of 2019, the Company recorded a gain on the sale of its FP&C business of $516 million. In the second and third quarters of 2019, the Company recorded an increase in the gain on sale of $6 million and $2 million, respectively, as a result of finalizing the proceeds relating to working capital. 
     
    The following table reconciles Net (loss) income attributable to Magna International Inc. to Adjusted net income attributable to Magna International Inc.:              
              2019   2020   2021
              1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q TOTAL
                             
                                             
    Net income (loss) attributable to Magna International Inc.     1,106           452          (233)           440        1,765   261          (647)           405           738           757   615           424             11        1,050
      Exclude:                                     
        Impairments and loss on sale of equity-accounted investments [i]   -                -           537 -           537   -                -           200 19           219   -                -                -                -
        Restructuring and impairments     14 7 27 3             51   - 136 - 101           237   15 31 20             66
        Net (gains) losses on investments     (151) 57 109 (10)               5   - - (20) (7)            (27)   (24) (29) 64             11
        Gain on business combinations     - - - -                -   - - - -                -   (40) - -            (40)
        Net (gains) losses on the sale of business     (438) (7) (2) -          (447)   - - - -                -   - - 75             75
    Adjusted net income (loss) attributable to Magna International Inc.   531           509           438           433        1,911   261          (511)           585           851        1,186   566           426           170        1,162
                                             
                                             
    Diluted earnings (loss) per share      $      3.39  $      1.42  $     (0.75)  $      1.43  $      5.59    $      0.86  $     (2.17)  $      1.35  $      2.45  $      2.52    $      2.03          1.40          0.04  $      3.46
      Exclude:                                    
        Impairments and loss on sale of equity-accounted investments [i]   -               -            1.74               -   1.70   -               -            0.67          0.06 0.73   -               -                 -   -
        Restructuring and impairments     0.04          0.02          0.08          0.01 0.16   -          0.46               -            0.34 0.79   0.05          0.10          0.06 0.21
        Net (gains) losses on investments     (0.46)          0.17          0.35         (0.03) 0.02   -               -           (0.07)         (0.02) (0.09)   (0.08)         (0.10)          0.21 0.04
        Gain on business combinations     -               -                 -                 -   -   -               -                 -                 -   -   (0.14)               -                 -   (0.13)
        Net (gains) losses on the sale of business     (1.34)         (0.02)         (0.01)               -   (1.42)   -               -                 -                 -   -   -               -            0.25 0.25
    Adjusted diluted earnings (loss) per share       $      1.63  $      1.59  $      1.41  $      1.41  $      6.05    $      0.86  $     (1.71)  $      1.95  $      2.83  $      3.95    $      1.86  $      1.40  $      0.56  $      3.83
     
    [i] Impairment charges                                    
    Impairment charges relating to the Company's equity accounted investment for 2019 and 2020, include $127 million and $ 75 million, respectively, attributable to non-controlling interest.
     

 

Q3 2021 Financial Review of Magna International Inc.Page 5 of 6 

 

Note 2: SEGMENTED INFORMATION  
     
              2019   2020   2021
              1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q 4th Q TOTAL   1st Q 2nd Q 3rd Q TOTAL
    Body Exteriors & Structures                     
      Sales     4,308 4,243 3,984 3,923 16,458   3,676 1,623 3,858 4,393 13,550   4,025 3,647 3,185 10,857
      Adjusted EBIT     363 341 306 289 1,299   199 (315) 390 543 817   327 227 98 652
      Adjusted EBIT as a percentage of sales     8.4% 8.0% 7.7% 7.4% 7.9%   5.4% -19.4% 10.1% 12.4% 6.0%   8.1% 6.2% 3.1% 6.0%
                                             
    Power & Vision                                    
      Sales     3,083 2,808 2,696 2,725 11,312   2,523 1,298 2,722 3,179 9,722   3,156 2,881 2,501 8,538
      Adjusted EBIT     216 201 167 163 747   135 (226) 227 359 495   297 203 67 567
      Adjusted EBIT as a percentage of sales     7.0% 7.2% 6.2% 6.0% 6.6%   5.4% -17.4% 8.3% 11.3% 5.1%   9.4% 7.0% 2.7% 6.6%
                                             
    Seating Systems                                    
      Sales     1,433 1,452 1,266 1,426 5,577   1,261 524 1,280 1,390 4,455   1,303 1,166 1,123 3,592
      Adjusted EBIT     94 83 56 79 312   40 (84) 66 85 107   55 26 22 103
      Adjusted EBIT as a percentage of sales     6.6% 5.7% 4.4% 5.5% 5.6%   3.2% -16.0% 5.2% 6.1% 2.4%   4.2% 2.2% 2.0% 2.9%
                                             
    Complete Vehicles                                    
      Sales     1,928 1,802 1,516 1,461 6,707   1,321 933 1,402 1,759 5,415   1,850 1,490 1,255 4,595
      Adjusted EBIT     28 43 29 44 144   50 44 70 110 274   80 79 30 189
      Adjusted EBIT as a percentage of sales     1.5% 2.4% 1.9% 3.0% 2.1%   3.8% 4.7% 5.0% 6.3% 5.1%   4.3% 5.3% 2.4% 4.1%
                                             
    Corporate and other                                    
      Intercompany fees     (161) (179) (143) (140) (623)   (124) (85) (133) (153) (495)   (155) (150) (145) (450)
      Adjusted EBIT     19 9 0 15 43   (21) (19) 25 (2) (17)   11 22 12 45
                                             
    Total                                        
      Sales     10,591 10,126 9,319 9,395 39,431   8,657 4,293 9,129 10,568 32,647   10,179 9,034 7,919 27,132
      Adjusted EBIT     720 677 558 590 2,545   403 (600) 778 1,095 1,676   770 557 229 1,556
      Adjusted EBIT as a percentage of sales     6.8% 6.7% 6.0% 6.3% 6.5%   4.7% -14.0% 8.5% 10.4% 5.1%   7.6% 6.2% 2.9% 5.7%
                                             
Note 3: 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:
                                             
              2019     2020     2021  
              1st Q 2nd Q 3rd Q 4th Q     1st Q 2nd Q 3rd Q 4th Q     1st Q 2nd Q 3rd Q  
                                             
    Cash and cash equivalents     (925) (563) (769) (1,276)     (1,146) (533) (1,498) (3,268)     (3,464) (3,426) (2,748)  
    Restricted cash equivalents included in prepaid expenses              (116)          (118)          (112)          (116)     (113) (115) (120) (106)                  -                 -                 -     
    Total cash, cash equivalents and restricted cash equivalents     (1,041) (681) (881) (1,392)     (1,259) (648) (1,618) (3,374)     (3,464) (3,426) (2,748)  

 

 

 

Q3 2021 Financial Review of Magna International Inc.Page 6 of 6