Tesla Sees First Quarterly Profits - Analyst Blog

Tesla Motors Inc. (TSLA) is on cloud nine now. The “green” automaker reported its first-ever quarterly profit of $15.4 million, or 12 cents per share, on an adjusted basis, in the first quarter of 2013 compared with a loss of $79.3 million or 76 cents in the corresponding quarter of 2012. This indicates a whopping positive earnings surprise of 271.4% given the Zacks Consensus Estimate of a loss of 7 cents for the quarter.

Revenues jumped manifold to $561.8 million from $30.2 million in the first quarter of 2012. Thanks to the impressive 5,000 units of Model S electric car sales during the quarter.

The automaker continued to supply full electric powertrains and battery packs to Toyota Motor Corp. (TM) for their RAV4 EV program. It also completed various deliverables under Daimler’s (DDAIF) Mercedes Benz B-Class EV program, which contributed to total development services revenues of nearly $7 million.

Although, total gross margin decreased to 17.1% from 33.8% a year ago but rose from 7.8% in the fourth quarter of 2012 due to higher Model S production rate, manufacturing efficiencies, cost reduction measures and regulatory credit sales.

Tesla had cash and cash equivalents of $214.4 million as of Mar 31, 2013 compared with $201.9 million as of Dec 31, 2012. Inventories declined 11.7% to $237.6 million from $268.5 million as of Dec 31, 2012. Long-term debt declined 2.8% to $439.6 million from $452.3 million as of Dec 31, 2012.

In the quarter, Tesla’s cash flow from operations improved to $64.1 million compared with cash flow use of $63.3 million in the first quarter of 2012. Capital expenditures increased 5.4% to $57.7 million $54.8 million a year ago.

Tesla expects to manufacture 5,000 Model S vehicles in the second quarter of the year. For full year 2013, the company expects to deliver 21,000 Model S cars globally, up 5% from its prior guidance of 20,000 units.

Tesla also plans to spend about $200 million as capital expenditures in 2013, as it concludes the majority of investments in the Tesla Factory and Model S tooling. Capital expenditures also includes the expansion of services, store development, Supercharger networks and new product development.

Currently, shares of Tesla retain a Zacks Rank #3, which implies a short-term (one to three months) Hold rating. Currently, Peugeot S.A. (PEUGY) with Zacks Rank #2 (Buy) is performing well in the global automotive industry.
 

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