Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from David Leiker – Robert W. Baird.
David Leiker – Robert W. Baird
I had to jump off and on a little bit today so I apologize if you touched on some of these but on the Delphi situation, how much of your Delphi revenue is related – is all of it related to this seat sensor?
Donald W. Duda
Yes, our AST division is completely dependent on the seat sensor, yes.
David Leiker – Robert W. Baird
But your Delphi revenue is 100% AST, right?
Donald W. Duda
Correct.
David Leiker – Robert W. Baird
Is there any other color that you can provide on this in terms of what your thoughts are of what happened here? It sounds like it was a little bit of a surprise to you?
Donald W. Duda
No, it wasn’t a surprise. As you might imagine, we’re going to be very guarded about what we say. We are involved in litigation with Delphi. It’s very difficult to say much more than that.
David Leiker – Robert W. Baird
On two other topics, if we look at your margin performance here in the quarter which is great, if you look sequentially at the prior quarter not year-over-year but sequentially on roughly the same revenue base you got almost a $20 million improvement in gross profit. Can you give us some broad buckets of what falls in to that and how much of that is really true underlying improvement in performance or if there’s anything in particular that we should be aware of as we look at that sequential profitability?
Douglas A. Koman
I think primarily I think we’re starting to see the benefit of a lot of the restructuring initiatives that we’ve been working on. That’s going to be the primary driver to the improvement in margins.
David Leiker – Robert W. Baird
But you got a $20 million improvement in cost savings from restructuring in a three month period, is that the way I should read that?
Douglas A. Koman
No, it’s not sequentially but I think I’d have to go back and look at what we had in the fourth quarter that might have been taking margins down a little bit. Because, if I looked sequentially on gross margins we did dip in the third and fourth quarter a little bit and now we’re coming back to a level that we’ve seen previously.
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