Federal-Mogul Corp. posted a higher profit in the second quarter, resulting to an increase in market share in the business segments that serve the auto industry. The auto parts supplier, which makes powertrain and safety technologies, is controlled by billionaire investor Carl Icahn.
It emerged from bankruptcy in December 2007 under Icahn's control. Federal-Mogul said that it aims to concentrate mostly on expanding its current businesses and "strategic" acquisitions.
It posted a net income of $64 million in the second quarter compared to $49 million the previous year. Sales had increased by about 13% to $1.8 billion. Analysts were anticipating sales of $1.7 billion.
According to CEO Jose Maria Alapont, the world economy slowed down in the second quarter but he explained that Federal Mogul’s flexibility and presence in both mature and emerging markets enable it to endure slowdowns. Alapont said that the “markets are not performing equally for everybody.”
He explained that those who aren’t seen globally will have some “bad quarters.” In the latest quarter, revenue increased by 22% in the "BRIC" Brazil, Russia, India and China) countries. In India, revenue rose by 28%.
In China, revenue increased by 20% however, its sales have dropped after having reached high growth levels earlier in the year. Federal-Mogul's restructuring deducted $460 million from its annual cost base in 2008 and 2009.