Viasystems Group, Inc. (NASDAQ:VIAS), a leading provider of complex
multi-layer printed circuit boards and electro-mechanical solutions,
today commented on the potential effects of supply issues related to the
recent natural disasters in Japan and increasing costs of materials and
labor.
"Our company has been working with many other companies in the
electronics industry to determine the near-term and longer-term impacts
of the interruption of the supply of electronic components from Japan,”
stated David Sindelar, Viasystems’ CEO. "While we expect only minor
impacts on the flow of supplies directly into our operations, the
possible impacts on our customers’ future order patterns have been more
difficult to assess. Reports of temporary cessation of production in
automobile and other factories suggest that component sourcing matters
unrelated to our business may result in customers deferring orders of
printed circuit boards and assemblies produced by Viasystems.”
"Developments related to Japan can only compound the cost environment
challenges which I highlighted in my comments about the results of our
final quarter of 2010,” continued Sindelar. "In addition to mandated
minimum wage increases in China, that government has begun imposing
employment based social taxes on foreign-owned enterprises like ours.
And, a continued tightening of labor resources in parts of southern
China is resulting in our company experiencing unusually high levels of
overtime pay costs for the workers we have retained. Similarly,
sustained high demand for electronic components has allowed materials
suppliers to command higher prices for their products, on top of the
upward market price effects of globally traded commodities like copper
and gold.”
"Our sales & marketing teams and our supply chain management teams are
heavily engaged with customers and suppliers to work through the current
and longer-term issues stemming from the tragedies in Japan,” concluded
Sindelar. "And, at the same time, we are also heavily engaged in
negotiations for selling price increases for our products to compensate
for the labor and materials cost increases.”
Forward Looking Statements
Certain statements in this communication may constitute "forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements are made on the basis of the
current beliefs, expectations and assumptions of the management of
Viasystems regarding future events and are subject to significant risks
and uncertainty. Investors are cautioned not to place undue reliance on
any such forward-looking statements, which speak only as of the date
they are made. Viasystems undertakes no obligation to update or revise
these statements, whether as a result of new information, future events
or otherwise. Actual results may differ materially from those expressed
or implied. Such differences may result from a variety of factors,
including but not limited to: legal or regulatory proceedings; any
actions taken by the Company, including but not limited to,
restructuring or strategic initiatives (including capital investments or
asset acquisitions or dispositions); or developments beyond the
Company’s control, including but not limited to, changes in domestic or
global economic conditions, competitive conditions and consumer
preferences, adverse weather conditions or natural disasters, health
concerns, international, political or military developments, and
technological developments. Additional factors that may cause results to
differ materially from those described in the forward-looking statements
are set forth under the heading "Item 1A. Risk Factors,” in the annual
report on form 10-K filed by Viasystems with the SEC on February 9, 2011
and in Viasystems’ other filings made from time to time with the SEC and
available at the SEC’s website, www.sec.gov.
About Viasystems
Viasystems Group, Inc. is a technology leader and a worldwide provider
of complex multi-layer, printed circuit boards (PCBs) and
electro-mechanical solutions (E-M Solutions). Its PCBs serve as the
"electronic backbone” of electronic equipment, and its E-M Solutions
products and services integrate PCBs and other components into
electronic equipment, including metal enclosures, cabinets, racks and
sub-racks, backplanes, cable assemblies and busbars. Viasystems’ 15,400
employees around the world serve more than 800 customers in the
automotive, industrial and instrumentation, telecom, computer/datacom
and military/aerospace end markets. For additional information about
Viasystems, please visit the Company’s website at www.viasystems.com.
