Martinrea looking for new CEO, reports higher adjusted earnings

TORONTO - Canadian autoparts manufacturer Martinrea International Inc. (TSX:MRE) is looking for a new president and chief executive officer to replace Nick Orlando, who will remain in the position for now.

The announcement came as Martinrea reported financial results for 2013, including a $51.4 million net loss or 60 cents per diluted share for the three months ended Dec. 31.

The quarter's loss included a $29.9-million writedown of the assets of an operation in Hopkinsville, Ky., $10.5 million in external costs related to the plant and a $23.3 million writedown of a tax asset.

After excluding those items, Martinrea had $14 million of adjusted earnings, or 17 cents per diluted share — four cents below the general estimate compiled by Thomson Reuters.

Orlando, who has been Martinrea's CEO since March 2011, acknowledged that the fourth quarter was "a disappointment from a financial point of view."

However, he also said many of Martinrea's divisions had good results and noted that some of its costs had been driven up as it prepares to do new work for automakers such as Chrysler, Nissan and General Motors.

The company said it has launched a search for a new president and chief executive, and the date for a hand-off from Orlando hasn't been determined. It said he'll remain as a consultant after he steps aside.

Martinrea also announced Monday that a special committee of its board has concluded its review of earlier public disclosures.

The review was launched after Nat Rea, a co-founder and former executive of Martinrea, alleged in September that certain members of management had breached duties to the company that could have affected previous financial reports.

Martinrea has said the claims are without merit and maintained that position on Monday's announcements. However, the board says it discovered unrelated errors with the accuracy of results from one of its Canadian factories — originally announced in December.

The company says it its latest financial report that it had a net loss of $7.05 million in the fourth quarter of 2012 and adjusted earnings of $12.2 million or 15 cents per share.

Martinrea originally announced on March 20, 2013, that it had a net loss of $6.6 million and adjusted net earnings of $12.6 million for the fourth quarter of 2012.

Revenue in the three months ended Dec. 31, 2013 was $858.6 million, up from $705.6 million in the fourth quarter of 2012, the same as originally announced on March 20, 2013.