DETROIT (Reuters) -- TRW Automotive Holdings Corp. posted a quarterly loss on Tuesday due to production cuts at automaker customers, but said it is confident the industry has hit bottom and its starting to recover.
TRW, which generates more than half of its sales in Europe, raised its 2009 revenue forecast after lifting its industry production forecast for Europe and trimming its North American forecast slightly.
The U.S.-based supplier produces vehicle safety equipment such as seat belts and airbags.
"We remain optimistic the first half of 2009 was the trough in global automotive production for the current downturn," CEO John Plant said in a statement. "Vehicle production forecasts are indicating higher levels of production for the remainder of 2009 and into 2010."
The TRW outlook follows similar statements of confidence from other auto parts makers and automakers in the past few days that the industry found a bottom earlier in 2009.
The net loss came to $11 million, or 11 cents per share, in the second quarter, compared with net earnings of $127 million, or a $1.24 per share profit, a year earlier.
Excluding restructuring and impairment charges and a gain on debt retirement, TRW reported earnings of $8 million, or 8 cents per share, down from $148 million, or $1.44 per share, a year earlier.
Revenue fell 38.6 percent to $2.73 billion. Analysts on average expected revenue of $2.58 billion, according to Reuters Estimates. Revenue was pressured in all regions due to sharply reduced vehicle production volumes.
Auto parts suppliers have suffered from steep production cuts this year by all major automakers, with U.S. auto sales down about 35 percent through the first half of 2009 to their lowest rates since the early 1980s.
The parts sector was dealt a further blow from extensive plant shutdowns in recent months associated with the bankruptcies of General Motors Corp. and Chrysler LLC. TRW said the GM and Chrysler bankruptcies had minimum effect on the company.
Automakers posted their best U.S. sales of the year in July supported by the government "Cash for Clunkers" program that started in the last week of the month. Similar programs have led to sales increases in key European markets such as Germany, Italy and France.
U.S. sales were down 12.2 percent from July 2008, the first time industry sales were down less than 30 percent since September 2008. Automakers also reported on Monday sharp inventory declines that provides support for potential production increases.
The auto parts supplier raised its full-year revenue forecast to a range of $10.5 billion to $10.9 billion, from $10.1 billion to $10.5 billion. Analysts expect $10.59 billion.
TRW expects North American industry production of 8 million vehicles in 2009, down slightly from a prior forecast for 8.2 million. It raised its European industry production forecast to 16.4 million vehicles from 15.9 million.
Plant said North American production was expected to be 1 million units higher in the second half of 2009 than in the first half and production forecasts were expected to show quarter-to-quarter improvements into the foreseeable future.
In morning New York Stock Exchange trading, TRW shares were up 12.9 percent at $19.83 -- 5.5 times their year-end 2008 price -- after rising to $20.93 earlier in the session.
TRW ranks No. 10 on the Automotive News Europe list of the top 100 global suppliers, with sales to automakers of $15 billion in 2008. Most of the sales volume, 56 percent, came from Europe.