Gentex Corp (NASDAQ: GNTX) reported Q2 EPS of $0.40, in-line with the analyst estimate of $0.40. Revenue for the quarter came in at $455 million versus the consensus estimate of $467.5 million.

2nd Quarter 2018 Summary

Net sales growth of 3% quarter over quarter

• Gross Margin increased from the first quarter of 2018 by 90 basis points
• Net Income increased 23% quarter over quarter
• Earnings per Diluted Share increased 29% quarter over quarter to $0.40 per share
• 6.3 million shares repurchased during the quarter at an average price of $23.33 per share
• $26.9 million of debt repaid during the quarter

"The second quarter of 2018 revenue growth rate fell just outside of our guidance range for the year which, although disappointing, is explainable when viewed in the context of production levels by region and segment. The overall production levels in the North American market were down 3% quarter over quarter and the luxury segments, defined as D and E segment vehicles, were down over 3% quarter over quarter in our primary markets of North America, Europe and Japan/Korea," said President and CEO, Steve Downing. “While we aren’t happy with this level of growth, we remain optimistic about the second half of 2018, based in part on our product launch cadence of Full Display Mirror nameplates over the balance of 2018. While we continue to monitor the production levels in our primary markets, we still have reason to believe that the second half of the year will be closer to the top end of the range of our annual revenue growth rate guidance," concluded Downing.For the second quarter of 2018, the gross margin improved to 38.0% when compared to a gross margin of 37.7% in the second quarter of 2017, and from 37.1% in the first quarter of 2018, primarily as a result of improved product mix and purchasing cost reductions. "The gross margin improvement sequentially from the first quarter of 2018 was impressive given the lower than expected growth rate for the quarter and was primarily driven by product mix improvements and the team's hard work to manage costs,” said President and CEO Steve Downing. “As we move through the second half of 2018, there is still opportunity for us to show additional improvements in gross margin based on the forecasted revenue growth rates and product mix, despite the negative headwinds expected from the tariffs that took effect on July 6th," said Downing.

GUIDANCE:

Gentex Corp sees FY2018 revenue of $1.88-1.91 billion, versus the consensus of $1.9 billion.

For earnings history and earnings-related data on Gentex Corp (GNTX) click here.