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Feb 22, 2018

Magna tops profit estimates, helped by higher sales in Europe

A Magna International plant in Meerane, eastern Germany, pictured in 2013.

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Canadian auto parts maker Magna International Inc (MG.TO) on Thursday reported a better-than-expected fourth-quarter profit, driven by higher sales in Europe and the launch of new cars for BMW and Jaguar.

Magna also assembles cars under contract from motor vehicle manufacturers and counts General Motors Co (GM.N), Volkswagen AG, BMW and Ford Motor Co (F.N) among its top customers.

Sales at Magna's vehicle assembly business in Graz, Austria, more than doubled during the reported quarter, helped by the 2017 launch of the BMW 5-Series and Jaguar's compact SUV, the E-Pace.

Magna's total sales rose 12 per cent to a US$10.39 billion, its highest ever, beating analysts' estimates of US$10.12, according to Thomson Reuters I/B/E/S.

During the reported quarter, light vehicle production increased 7 per cent in Europe and fell 5 per cent in North America.

Car registrations in the European Union rose 3.4 per cent in 2017 to more than 15 million vehicles for the first time since 2007.  

Net income attributable to Magna rose to US$556 million, or US$1.53 per share, in the fourth quarter ended Dec. 31, from US$478 million, or US$1.24 per share, a year earlier.

Excluding items, the company earned US$1.57 per share, beating analysts' estimate by 2 cents.