Stoneridge Inc (NYSE: SRI)

Stoneridge Inc is a global supplier of safe and efficient electronics systems and technologies. Its systems and products power vehicle intelligence while enabling safety and security for on and off highway transportation sectors worldwide. The company supplies its custom engineered products and systems to commercial vehicle automotive off highway agricultural and other vehicle markets. Its product offerings include actuators sensors switches connectors advanced driver information products vision systems connectivity and compliance solutions control modules vehicle tracking devices monitoring services vehicle security alarms convenience accessories telematics solutions and multimedia devices. These products activate equipment and accessories monitor and display vehicle performance and control distribute electrical power and signals and provide vehicle safety security and convenience.

Stoneridge Inc generates revenue through the sale of its electronics systems and technologies to original equipment manufacturers and Tier 1 suppliers as well as select non vehicle OEMs. Its products are predominantly supplied on a sole source basis to leading commercial vehicle automotive and off highway OEMs. The company also serves automotive and commercial vehicle Tier 1 suppliers. Revenue is derived from products used to activate equipment monitor vehicle performance distribute power and provide safety security and convenience features. Customers increasingly utilize electronic technology to comply with stringent safety regulations and meet end user demand for improved vehicle performance and convenience driving growth in per vehicle electronic content.

The company operates through the following segments: Control Devices Electronics and Stoneridge Brazil.

• Control Devices designs and manufactures products that monitor measure or activate specific functions within a vehicle. This segment includes product lines such as actuators sensors switches and connectors. Actuator products enable OEMs to deploy power functions in a vehicle and can integrate switching and control functions including park lock and front axle disconnect products. Sensor products are employed in major vehicle systems such as emissions safety powertrain braking climate control steering and suspension systems and are now being applied to electric vehicle thermal management systems. Switches and connectors transmit signals that activate specific functions and are used in user activated and hidden capacities. User activated switches are used by a vehicle s operator or passengers to manually activate in vehicle accessories. Hidden switches are not typically visible and are engaged to activate or deactivate selected functions as part of normal vehicle operations. These products are sold principally to the automotive market and to a lesser extent to the commercial vehicle and agricultural markets.

• Electronics designs and manufactures advanced driver information solutions vision systems connectivity and compliance solutions and control modules. Vision systems including the MirrorEye product provide enhanced vehicle visibility and safety to drivers by eliminating blind spots expanding field of view and improving nighttime visibility. Advanced driver information solutions and connectivity and compliance products collect store and display vehicle information such as speed pressure maintenance data trip information operator performance temperature distance traveled and driver messages related to vehicle performance. These products are sold principally to the commercial vehicle and off highway markets through both OEM and aftermarket channels.

• Stoneridge Brazil primarily serves the South American market and designs and manufactures vehicle tracking devices and monitoring services driver information systems vehicle security alarms and convenience accessories telematics solutions and multimedia devices primarily for the automotive and commercial vehicle markets. This segment includes product lines such as vehicle monitoring and tracking devices driver information systems security alarms convenience applications such as parking sensors and rearview cameras telematics solutions used for fleet management infotainment and multimedia devices. These products improve the performance safety and convenience features of customers vehicles. Stoneridge Brazil sells its products through the aftermarket distribution channel direct to OEMs and to factory authorized dealer installers also referred to as original equipment services. In addition monitoring services and tracking devices are sold directly to corporate and individual customers.

Stoneridge Inc operates in a highly competitive market for its products in each reportable segment where competition is based on technological innovation price quality performance service and delivery. The company competes for new business at the beginning of new model development and upon the redesign of existing models for OEM customers. It also competes for aftermarket sales based on price product functionality quality and service. Stoneridge Inc leverages strong customer relations and a fast and flexible organization that develops technically effective solutions at a competitive price to maintain its position within the industry. The markets for its products are cyclical and significantly dependent on the general state of the economy and factors such as the impact of environmental regulations on customers and end market consumers.

Stoneridge Inc serves numerous OEM and Tier 1 customers as well as aftermarket distributors for use on many different vehicle platforms. The company supplies multiple parts to many of its principal OEM and Tier 1 customers under requirements contracts for a particular vehicle model which range in duration from one year to the production life of the model commonly extending three to seven years. Its customer base includes leading commercial vehicle automotive and off highway original equipment manufacturers as well as select non vehicle OEMs and Tier 1 suppliers. Additionally the company serves aftermarket distributors and corporate and individual customers for monitoring services and tracking devices particularly through its Stoneridge Brazil segment.