TRW Automotive Holdings, which operates from a number of former Lucas sites in the West Midlands, yesterday delivered better than expected first quarter profits and raised its full-year outlook, helped by improved sales of automotive safety products, an acquisition and higher car production.
Michigan-based TRW said its outlook depended on coping with rising commodity prices and lower light-vehicle production that it expects to hurt industry results in the second half of 2006. Net income fell to £25.5 million in the first quarter from £27.2 million a year earlier.
The figure takes into account the paying down of £31 million of debt.
JP Morgan analyst Himanshu Patel said: "We maintain our overweight rating, as we think a recent correction in this well-diversified vehicle safety supplier has been unjustified."
TRW, which makes such products as airbags, said results excluding the debt expense were above its prior forecasts mainly on higher revenue, a better operating performance and lower tax expenses than expected.
Sales rose by 5.3 per cent to £1.84 billion, marginally ahead of analysts' predictions.
Automotive safety products have been seen as a strong growth area for parts suppliers, providing a contrast to struggles elsewhere in a US parts sector that has seen several bankruptcies, most recently Dana Corporation.