Delphi considering future share buybacks
DETROIT, Jan 5 (Reuters) - Delphi Automotive Systems Corp. (NYSE:DPH - news) Chief Financial Officer Alan Dawes on Wednesday said the auto supplier is considering repurchasing shares, but so far had been able to get better shareholder returns through acquisitions and pension contributions.
Dawes told reporters on a conference call that buying back shares is something Delphi, the world's No. 1 auto supplier, considers on a regular basis.
''We are considering share repurchases. At this point though, the acquisitions that we have completed or announced, and the pension contributions have exceeded the returns of share repurchases,'' he said.
Delphi announced Wednesday it will add $575 million to its U.S. hourly pension fund on Thursday, bringing its total contributions to $1.8 billion since it split from General Motors Corp. (NYSE:GM - news) in May.
Dawes said Delphi's more than $2 billion in cash flow in 1999 gave it the freedom to put money into its pension fund earlier than planned. The contributions will lower Delphi's pension expenses by about 10 percent this year, adding $57 million to its 2000 earnings. Analysts had already expected the earnings boost, Dawes said.
The $1.8 billion in contributions means Delphi has mostly funded its pension obligations. Dawes said there is a small amount stemming from its new labor contracts that remains unfunded.
Dawes said between 10,000 and 11,000 hourly workers retired from the company in 1999, while the company replaced about 2,000 of those.
|
