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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: October 19, 2005
GENTEX CORPORATION
(Exact Name of Registrant as Specified in Charter)
Michigan 0-10235 38-2030505
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
600 North Centennial Street
Zeeland, Michigan 49464
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (616) 772-1800
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Section
Act (17 CFR 230.425).
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12).
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240-14d-2(b)).
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c)).
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SECTION 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITIONS
On October 19, 2005, Gentex Corporation issued a news release announcing results
for the third quarter ended September 30, 2005. A copy of the news release is
attached as Exhibit 99.1 to this Form 8-K.
The information in this Form 8-K and the attached Exhibit shall not be deemed
filed for purposes of Section 18 of the Securities Exchange Act of 1934, nor
shall it be deemed incorporated by reference in any filing under the Securities
Act of 1933, except as shall be expressly set forth by specific reference in
such filing.
SECTION 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibit
99.1 - News Release Dated October 19, 2005.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: October 19, 2005 GENTEX CORPORATION
(Registrant)
By: /s/ Enoch Jen
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Enoch Jen
Vice President - Finance and
Chief Financial Officer
EXHIBIT INDEX
99.1 News Release Dated October 19, 2005
Exhibit 99.1
[LOGO OF GENTEX CORPORATION]
CONTACT: Connie Hamblin RELEASE: October 19, 2005
(616) 772-1800
GENTEX REPORTS RECORD REVENUES:
MIRROR UNIT SHIPMENT GROWTH INCREASES BY 16 PERCENT IN THE THIRD QUARTER
ZEELAND, Michigan, October 19, 2005 -- Gentex Corporation, the Zeeland,
Michigan-based manufacturer of automatic-dimming rearview mirrors and commercial
fire protection products, today reported third quarter revenues and net income
for the quarter ended September 30, 2005. In addition, the Company announced
that it has recently negotiated an extension to its long-term agreement with
DaimlerChrysler. The Company also repurchased approximately 1,496,000 shares
during the third quarter.
The Company reported record revenues for the third quarter of 2005 of
$138.1 million, a 15 percent increase over revenues of $120.5 million reported
in the third quarter last year. Third quarter net income of $27.9 million
increased by 11 percent compared with net income of $25.2 million in the
comparable 2004 quarter. Earnings per diluted share were 18 cents in the third
quarter of 2005 compared with 16 cents in the third quarter of 2004. All per
share data reflects the two-for-one stock split effected in the form of a 100
percent common stock dividend that became effective on May 9, 2005.
For the first nine months of 2005, the Company posted net income of
$79.9 million on revenues of $398.1 million, compared with net income of $84.0
million on revenues of $379.4 million for the same period in 2004. Earnings per
diluted share were 51 cents for the first nine months of 2005 compared with 54
cents for the same period in 2004.
According to Garth Deur, Gentex executive vice president, the Company
also recently negotiated a three-year extension to its current long-term
agreement with DaimlerChrysler for virtually all interior and exterior
auto-dimming mirrors, extending the existing agreement through the end of the
2009 calendar year.
The Company also reported that it repurchased approximately 1,496,000
shares during the third quarter of 2005 at a cost of approximately $25.2
million. The Company has a share repurchase plan in place with authorization to
repurchase up to 8 million shares of the Company's stock. To date, including the
prior share repurchases in 2003, the Company has repurchased approximately
2,326,000 shares, leaving approximately 5,674,000 shares authorized to be
repurchased under the plan.
Mirror unit shipments in North America in the third quarter increased
by 14 percent while light vehicle production in that market increased by two
percent. The increase in unit shipments in North America was due to higher
shipments to Asian transplant automakers and accelerated growth in the Company's
exterior mirror business. Unit shipments to offshore automakers increased by 18
percent during the quarter. Light vehicle production declined by one percent in
Europe and increased by six percent in the Japan and Korean markets in the third
quarter of 2005 compared with the same quarter last year.
"We are pleased to see the higher rates of growth in our exterior
mirror business as new and existing customers opt to offer complete
glare-control systems on their vehicles," said Deur. "In addition, we have been
seeing higher-than-expected European and Korean unit shipments due to the strong
start-up of several new mirror programs with customers in those regions."
The Company reported a slightly lower than expected gross margin in the
third quarter, which was primarily attributable to yield issues on certain new
manufacturing processes. The start-up challenges are taking longer to work
through than the Company previously anticipated, and these issues are making it
more difficult for the Company to offset ongoing customer price reductions.
"To say that we are working diligently to resolve these yield issues
would be an understatement," said Deur, "but we do expect it to take us a while
longer as the challenges happen to be on products where customer demand is
increasing, and we cannot take risks on quality or customer delivery schedules.
The challenges that we have been facing are not insurmountable and, as we
continue to make improvements, we expect that our manufacturing costs will also
gradually improve.
"Overall, we are very pleased with our results in the third quarter.
After a year of slower growth, we are looking forward to a strong 2006 model
year," Deur said.
Total auto-dimming mirror unit shipments for the third quarter of 2005
increased by 16 percent to 3,198,000 units, compared with 2,756,000 units for
the same quarter in 2004. Total automotive revenues in the third quarter of 2005
increased by 15 percent to $131.7 million, compared with the same quarter last
year.
Total auto-dimming mirror unit shipments for the first nine months of
2005 increased by seven percent to 9,323,000 units, compared with 8,739,000
units for the same period in 2004. Total automotive revenues increased by five
percent for the first nine months of 2005 to $379.8 million, compared the same
period in 2004.
For the first nine months of 2005, auto-dimming mirror unit shipments
in North America increased by three percent compared with the same prior year
period, while light vehicle production declined by about one percent for the
first nine months of 2005. Mirror unit shipments to offshore customers increased
by ten percent compared with the same prior year period. During the first nine
months of 2005, light vehicle production was flat in Europe and increased by six
percent in the Japan and Korean markets, compared with the first nine months of
2004.
For the fourth quarter of 2005, the Company estimates that the growth
in mirror unit shipments will be in the range of ten to 15 percent compared with
the fourth quarter of 2004.
"While we currently believe that this may be a conservative estimate,
we continue to be cautious due to uncertainties associated with the automotive
industry at this time," said Deur.
Revenues in the Company's Fire Protection Products Group increased by
nine percent in the third quarter of 2005 to $6.4 million, compared with the
third quarter last year. For the first nine months of 2005, fire protection
revenues increased by six percent to $18.4 million.
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act, as amended, that are based on management's
belief, assumptions, current expectations, estimates and projections about the
global automotive industry, the economy and the Company itself. Words like
"anticipates," "believes," "confident," "estimates," "expects," "forecast,"
"likely," "plans," "projects," and "should," and variations of such words and
similar expressions identify forward-looking statements (e.g. unit shipment
growth estimates). These statements do not guarantee future performance and
involve certain risks, uncertainties, and assumptions that are difficult to
predict with regard to timing, expense, likelihood and degree of occurrence.
These risks include, without limitation, employment and general economic
conditions, the pace of economic recovery in the U.S. and in international
markets, the pace of automotive production worldwide, the types of products
purchased by customers, competitive pricing pressures, currency fluctuations,
the financial strength of the Company's customers, the mix of products purchased
by customers, the ability to continue to make product innovations, the success
of certain products, and other risks identified in the Company's filings with
the Securities and Exchange Commission. Therefore actual results and outcomes
may materially differ from what is expressed or forecasted. Furthermore, the
Company undertakes no obligation to update, amend, or clarify forward-looking
statements, whether as a result of new information, future events, or otherwise.
A conference call related to this news release will be simulcast live
on the Internet beginning at 9:30 a.m. Eastern Daylight Time today. To access
that call, go to www.gentex.com and select the "Audio Webcast" icon in the lower
right-hand corner of the page. Other conference calls hosted by the Company will
also be available at that site in the future.
Founded in 1974, Gentex Corporation (Nasdaq: GNTX) is an international
company that provides high-quality products to the worldwide automotive industry
and North American fire protection market. Based in Zeeland, Michigan, the
Company develops, manufactures and markets interior and exterior
automatic-dimming automotive rearview mirrors that utilize proprietary
electrochromic technology to dim in proportion to the amount of headlight glare
from trailing vehicle headlamps. Many of the mirrors are sold with advanced
electronic features, and approximately 95 percent of the Company's revenues are
derived from the sales of auto-dimming mirrors to nearly every major automaker
in the world.
GENTEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
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Three Months Ended Nine Months Ended
September 30, September 30,
------------------------------- -------------------------------
2005 2004 2005 2004
-------------- -------------- -------------- --------------
Net Sales $ 138,114,897 $ 120,456,707 $ 398,141,062 $ 379,430,532
Costs and Expenses
Cost of Goods Sold 86,918,447 72,754,752 249,326,226 222,388,833
Engineering, Research & Development 9,140,231 7,758,575 25,916,046 22,747,948
Selling, General & Administrative 6,762,837 6,550,287 20,613,966 20,175,499
Other Expense (Income) (5,489,437) (3,431,740) (14,373,015) (9,816,848)
-------------- -------------- -------------- --------------
Total Costs and Expenses 97,332,078 83,631,874 281,483,223 255,495,432
-------------- -------------- -------------- --------------
Income Before Provision
for Income Taxes 40,782,819 36,824,833 116,657,839 123,935,100
Provision for Income Taxes 12,847,000 11,600,000 36,748,000 39,910,000
-------------- -------------- -------------- --------------
Net Income $ 27,935,819 $ 25,224,833 $ 79,909,839 $ 84,025,100
============== ============== ============== ==============
Earnings Per Share
Basic $ 0.18 $ 0.16 $ 0.51 $ 0.55
Diluted $ 0.18 $ 0.16 $ 0.51 $ 0.54
Weighted Average Shares:
Basic 155,817,978 154,487,100 155,545,871 154,118,332
Diluted 157,458,416 156,435,922 157,137,065 156,747,022
Cash Dividends Declared per Share $ 0.090 $ 0.085 $ 0.260 $ 0.235
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
Sept 30, Dec 31,
2005 2004
-------------- --------------
ASSETS
Cash and Short-Term Investments $ 481,242,837 $ 494,880,260
Other Current Assets 125,235,959 97,728,834
-------------- --------------
Total Current Assets 606,478,796 592,609,094
Plant and Equipment - Net 158,926,604 135,649,119
Long-Term Investments and Other Assets 139,602,583 128,601,215
-------------- --------------
Total Assets $ 905,007,983 $ 856,859,428
============== ==============
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities $ 67,401,006 $ 50,856,258
Long-Term Debt 0 0
Deferred Income Taxes 22,298,802 22,723,198
Shareholders' Investment 815,308,175 783,279,972
-------------- --------------
Total Liabilities & Shareholders' Investment $ 905,007,983 $ 856,859,428
============== ==============
Note: All earnings per share amounts and weighted daily average shares
outstanding reflect the 2-for-1 stock split effected in the form of a 100%
common stock dividend effective on May 9, 2005.
[LOGO OF GENTEX CORPORATION]
AUTO-DIMMING MIRROR UNIT SHIPMENTS
(Thousands)
THIRD QUARTER NINE MONTHS ENDED
ENDED SEPTEMBER 30, SEPTEMBER 30,
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2005 2004 % CHANGE 2005 2004 % CHANGE
-------- -------- -------- -------- -------- --------
Domestic Interior 1,032 933 11% 3,111 3,010 3%
Domestic Exterior 492 403 22% 1,351 1,311 3%
Total Domestic Units 1,524 1,336 14% 4,462 4,321 3%
Foreign Interior 1,197 1,057 13% 3,527 3,261 8%
Foreign Exterior 477 363 32% 1,334 1,157 15%
Total Foreign Units 1,674 1,420 18% 4,861 4,418 10%
Total Interior Mirrors 2,230 1,990 12% 6,638 6,271 6%
Total Exterior Mirrors 969 766 27% 2,686 2,468 9%
Total Mirror Units 3,198 2,756 16% 9,323 8,739 7%
Note: Certain prior year amounts have been reclassified to conform with the
current year presentation. Amounts may not total due to rounding.
End of Filing