Visteon operating loss improves to $36 million in second quarter

By Caroline Salls

Pittsburgh, Aug. 9 - Visteon Corp. reported a $36 million operating loss for the second quarter on $1.945 billion in sales, according to a company news release.

The figures showed improvement over the $42 million operating loss posted for the second quarter of 2009 on $1.569 billion in sales.

However, the net loss for the three months ended June 30 was $177 million, widening from a $99 million net loss for the same period of 2009.

According to the release, the net loss attributable to Visteon, which was $201 million, included a $122 million charge for post-bankruptcy interest expenses and a $75 million charge related to changes in post-retirement employee benefit plans.

Visteon recorded $210 million of operating income for the six months ended June 30 on $3.849 billion in sales, compared with $25 million of operating income for the first half of 2009 on $2.921 billion in sales.

The net income for the first six months of this year was $71 million, improving from a $91 million net loss for the six months ended June 30, 2009.

The company had $979 million in cash and cash equivalents at June 30, up from $962 million at Dec. 31.

"The increase in global vehicle production volumes combined with our on-going actions to improve our operations and our cost structure continues to drive year-over-year financial improvement," chairman and chief executive officer Donald J. Stebbins said in the release.

"While we don't expect global vehicle production in the second-half of this year to approach first-half levels, our lean and globally balanced engineering and manufacturing footprint provides a competitive advantage in growing with our customers around the world."

Plan, offering results

In addition, Visteon announced that preliminary results of voting on its plan of reorganization indicate that all creditor and equity classes have voted to accept the plan.

As a result, Visteon said it will ask the court to hold its plan confirmation hearing on Aug. 31.

Also, the subscription deadline for the company's $950 million rights offering to eligible holders of its unsecured senior notes has passed, and early results show that the rights offering has been oversubscribed.

Visteon said it has reached an agreement with the investors under its equity commitment and an informal committee of equity holders under which the committee will support the plan without any changes and withdraw its legal challenges.

In exchange, the committee will receive the right to participate in the direct purchase commitment under the equity commitment agreement for 144,456 shares and receive up to $4.25 million for costs and expenses.

Visteon, a Van Buren Township, Mich., global automotive supplier, filed for bankruptcy on May 28, 2009 in the U.S. Bankruptcy Court for the District of Delaware. Its Chapter 11 case number is 09-11786.

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