Note: All figures in this story are in Canadian dollars unless otherwise indicated.
Linamar Corp. achieved unprecedented revenue and significant earnings growth in the second quarter of 2023. The company’s industrial unit demonstrated continued strength, while automotive parts sales rebounded from pandemic-era lows.
The Guelph, Ont.-based supplier reported sales of C$2.55 billion ($1.9 billion USD) for the quarter, compared to $1.98 billion in the same period last year.
Linda Hasenfratz, CEO of Linamar, noted that the company’s margins have been steadily increasing since late 2021 when vehicle production was severely impacted by the global microchip shortage.
During a conference call with investors and analysts, Hasenfratz stated, “This quarter exemplifies Linamar’s successful diversification strategy, leading to consistent and sustainable earnings growth.”
In the second quarter of 2023, Linamar’s mobility segment generated $1.77 billion in sales, representing a 20 percent increase compared to the same period in 2022. The industrial segment experienced even stronger growth, with revenue of $777.3 million, up 54 percent from the previous year’s quarter.
Looking ahead, Linamar anticipates double-digit sales growth in both its mobility and industrial units for the latter half of 2023. The company also projects another year of double-digit growth in 2024.
The expansion will largely be driven by the production of parts for battery-electric and hybrid vehicles.
Hasenfratz emphasized the significant impact of this emerging segment on Linamar’s mobility business. Currently, electrified or propulsion-agnostic components account for one-third of the company’s mobility sales, a figure projected to reach 56 percent by 2027 according to internal estimates.
To consolidate its focus in this area, Linamar announced the establishment of the Linamar Structures Group. This new corporate unit will oversee the company’s recently acquired battery enclosure plants in Europe and the U.S., as well as its Mills River castings plant in North Carolina and the construction of a new giga castings plant in Welland, Ont.
Hasenfratz stated, “The Linamar Structures Group, with current bookings of approximately $1 billion, will play a pivotal role in our automotive business as the industry transitions to electric vehicles.”
Furthermore, Linamar remains open to potential acquisitions, as its robust financial position allows for continued pursuit of such opportunities.
In 2022, Linamar ranked No. 59 on the Automotive News list of the top 100 global suppliers, with worldwide sales to automakers totaling $4.3 billion USD.
Denial of responsibility! SamacharCentrl is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.
