Commercial Vehicle Group Up on Earnings, Acquisition of New Business

Shares of Commercial Vehicle Group, Inc. (NASDAQ:CVGI) are rising over 11% in morning trade after the company reported fourth-quarter profits and revenues well above analyst estimates. Separately the company announced it has been awarded its first wire harness business with Cummins Emission Solutions (CES), a division of Cummins Inc. (NYSE: CMI).

The company reported revenues of $225.8 million for the fourth quarter of 2011, up 42.9% compared to $158.1 million for the prior-year period.  This exceeded analyst estimates. Operating income for the fourth quarter was $16.1 million compared to $5.4 million for the fourth quarter of 2010.

Net income was $10.1 million for the fourth quarter, or $0.36 per diluted share, compared to $4.0 million, or $0.14 per diluted share in the prior-year quarter. This handily exceeded analyst estimates by 10 cents a share

“Our fourth quarter marks our highest revenue and operating income levels since the fourth quarter of 2006 and our eleventh consecutive quarter of operating income improvement, when excluding impairment and restructuring charges.  We are very pleased with our performance this past year and this most recent quarter.  Given our strong financial structure and liquidity position, we remain heavily focused on seeking opportunities that fit our long-term strategic goals of growth and diversification,” said Mervin Dunn, President and CEO of Commercial Vehicle Group.

“Sequentially, when compared to the third quarter of this year, our revenues increased $8.9 million and operating income increased $2.5 million, which represents a 28% contribution margin.  We are very pleased with our results and continued improvement in our revenues and operating earnings as well as our fourth quarter diluted earnings per share of 36 cents, which marks the highest reported level since the fourth quarter of 2006,” said Chad M. Utrup, Chief Financial Officer of Commercial Vehicle Group.

The company also said CES and CVG’s Electrical Systems group signed a Letter of Intent calling for CVG to supply CES’s 2013 “On Highway” program with wire harnesses.  Under this CVG products will be used as part of after-treatment systems provided by Cummins to power on-highway trucks.

“This is a great beginning to a meaningful, long-term relationship between CVG and Cummins,” said Kevin R.L. Frailey, President & General Manager of Electrical Systems for CVG.  “The cooperation between both companies’ engineering teams in the USA, Mexico and China has been highly productive.  We see a great opportunity for us to work together on this and future projects,” Frailey stated.

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Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.