vc-20230630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

________________

FORM 10-Q

(Mark One)

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission file number 001-15827

VISTEON CORPORATION

(Exact name of registrant as specified in its charter)


State of	Delaware		38-3519512
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
One Village Center Drive,	Van Buren Township,	Michigan	48111
(Address of principal executive offices)			(Zip code)

Registrant’s telephone number, including area code: (800)-VISTEON

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $.01 Per Share	VC	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ü No__

Indicate by check mark whether the registrant: has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ü No __

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer," "accelerated filer,” "smaller reporting company" and “emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ü Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ü

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ü No ☐

As of July 27, 2023, the registrant had outstanding 28,199,370 shares of common stock.

Exhibit index located on page number 38.

Visteon Corporation and Subsidiaries

Index


Part I - Financial Information		Page
	Item 1 - Condensed Consolidated Financial Statements	3
	Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)	3
	Condensed Consolidated Balance Sheets (Unaudited)	4
	Condensed Consolidated Statements of Cash Flows (Unaudited)	5
	Condensed Consolidated Statements of Changes in Equity (Unaudited)	6
	Notes to Condensed Consolidated Financial Statements (Unaudited)	7
	Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations	23
	Item 3 - Quantitative and Qualitative Disclosures about Market Risk	35
	Item 4 - Controls and Procedures	35
Part II - Other Information		37
	Item 1 - Legal Proceedings	37
	Item 1A - Risk Factors	37
	Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds	37
	Item 6 - Exhibits	37
Exhibit Index		38
Signatures		38

Part I

Financial Information

Item 1.Condensed Consolidated Financial Statements

VISTEON CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In millions except per share amounts)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Net sales	$	983	$	848	$	1,950	$	1,666
Cost of sales	(879)		(774)		(1,736)		(1,516)
Gross margin	104		74		214		150
Selling, general and administrative expenses	(52)		(43)		(104)		(87)
Restructuring and impairment	(1)		(4)		(2)		(11)
Interest expense	(4)		(4)		(9)		(7)
Interest income	1		1		3		2
Equity in net income of non-consolidated affiliates	(2)		1		(7)		4
Other income (expense), net	(10)		5		(7)		10
Income (loss) before income taxes	36		30		88		61
Provision for income taxes	(13)		(7)		(27)		(15)
Net income (loss)	23		23		61		46
Less: Net (income) loss attributable to non-controlling interests	(3)		1		(7)		—
Net income (loss) attributable to Visteon Corporation	$	20	$	24	$	54	$	46

Comprehensive income (loss)	$	3	$	(21)	$	56	$	6
Less: Comprehensive (income) loss attributable to non-controlling interests	1		5		(2)		4
Comprehensive income (loss) attributable to Visteon Corporation	$	4	$	(16)	$	54	$	10




Basic earnings (loss) per share attributable to Visteon Corporation	$	0.71	$	0.85	$	1.91	$	1.64




Diluted earnings (loss) per share attributable to Visteon Corporation	$	0.70	$	0.85	$	1.88	$	1.61

See accompanying notes to the condensed consolidated financial statements.

VISTEON CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions)


	(Unaudited)
	June 30,		December 31,
	2023		2022
ASSETS
Cash and equivalents	$	455	$	520
Restricted cash	4		3
Accounts receivable, net	678		672
Inventories, net	329		348
Other current assets	131		167
Total current assets	1,597		1,710
Property and equipment, net	367		364
Intangible assets, net	88		99
Right-of-use assets	122		124
Investments in non-consolidated affiliates	37		49
Other non-current assets	110		104
Total assets	$	2,321	$	2,450
LIABILITIES AND EQUITY
Short-term debt	$	21	$	13
Accounts payable	564		657
Accrued employee liabilities	74		90
Current lease liability	30		29
Other current liabilities	222		246
Total current liabilities	911		1,035
Long-term debt, net	327		336
Employee benefits	109		115
Non-current lease liability	93		99
Deferred tax liabilities	30		27
Other non-current liabilities	73		64
Stockholders’ equity:
Preferred stock (par value 0.01, 50 million shares authorized, none outstanding as of June 30, 2023 and December 31, 2022)	—		—
Common stock (par value $0.01, 250 million shares authorized, 55 million shares issued, and 28.2 million shares outstanding as of June 30, 2023 and December 31, 2022)	1		1
Additional paid-in capital	1,341		1,352
Retained earnings	1,842		1,788
Accumulated other comprehensive loss	(213)		(213)
Treasury stock	(2,266)		(2,253)
Total Visteon Corporation stockholders’ equity	705		675
Non-controlling interests	73		99
Total equity	778		774
Total liabilities and equity	$	2,321	$	2,450

See accompanying notes to the condensed consolidated financial statements.

VISTEON CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)


	Six Months Ended June 30,
	2023		2022
Operating Activities
Net income (loss)	$	61	$	46
Adjustments to reconcile net income (loss) to net cash provided from (used by) operating activities:
Depreciation and amortization	55		52
Non-cash stock-based compensation	17		13
Equity in net loss (income) of non-consolidated affiliates, net of dividends remitted	7		(4)
Impairments	—		4
Other non-cash items	(4)		—
Changes in assets and liabilities:
Accounts receivable	(7)		(74)
Inventories	17		(62)
Accounts payable	(89)		(2)
Other assets and other liabilities	(15)		(45)
Net cash provided from (used by) operating activities	42		(72)
Investing Activities
Capital expenditures, including intangibles	(51)		(36)
Contributions to equity method investments	—		(1)
Settlement of derivative contracts	—		5
Other	2		1
Net cash used by investing activities	(49)		(31)
Financing Activities
Dividends to non-controlling interests	(15)		—
Short-term debt, net	3		(4)
Repurchase of common stock	(30)		—
Stock based compensation tax withholding payments	(15)		—
Proceeds from the exercise of stock options	4		—
Principal repayment of term debt facility	(4)		—
Net cash used by financing activities	(57)		(4)
Effect of exchange rate changes on cash	—		(23)
Net decrease in cash, equivalents, and restricted cash	(64)		(130)
Cash, equivalents, and restricted cash at beginning of the period	523		455
Cash, equivalents, and restricted cash at end of the period	$	459	$	325

See accompanying notes to the condensed consolidated financial statements.

VISTEON CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In millions)

(Unaudited)


	Total Visteon Corporation Stockholders' Equity
	Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total Visteon Corporation Stockholders' Equity		Non-Controlling Interests		Total Equity
December 31, 2022	$	1	$	1,352	$	1,788	$	(213)	$	(2,253)	$	675	$	99	$	774
Net income (loss)	—		—		34		—		—		34		4		38
Other comprehensive income (loss)	—		—		—		16		—		16		(1)		15
Stock-based compensation, net	—		(18)		—		—		13		(5)		—		(5)
Dividends to non-controlling interest	—		—		—		—

SEC Form 10-Q filed by Visteon Corporation