DELPHI 2015 Annual Report Download - page 67

Table of Contents
45
Consolidated Results of Operations
2014 versus 2013
The results of operations for the years ended December 31, 2014 and 2013 were as follows:
Year Ended December 31,
2014 2013
Favorable/
(unfavorable)
(dollars in millions)
Net sales.............................................................................................................. $ 15,499 $ 15,051 $ 448
Cost of sales........................................................................................................ 12,471 12,274 (197)
Gross margin....................................................................................................... 3,028 19.5% 2,777 18.5% 251
Selling, general and administrative ............................................................... 1,036 916 (120)
Amortization.................................................................................................. 94 97 3
Restructuring ................................................................................................. 140 137 (3)
Operating income................................................................................................ 1,758 1,627 131
Interest expense ............................................................................................. (135) (143) 8
Other (expense) income, net.......................................................................... (8) (18) 10
Income from continuing operations before income taxes and equity income .... 1,615 1,466 149
Income tax expense ....................................................................................... (255) (240) (15)
Income from continuing operations before equity income................................. 1,360 1,226 134
Equity income, net of tax............................................................................... 20 15 5
Income from continuing operations.................................................................... 1,380 1,241 139
Income from discontinued operations, net of tax .......................................... 60 60 —
Net income.......................................................................................................... 1,440 1,301 139
Net income attributable to noncontrolling interest ............................................. 89 89 —
Net income attributable to Delphi....................................................................... $ 1,351 $ 1,212 $ 139
Total Net Sales
Below is a summary of Delphi’s total net sales for the year ended December 31, 2014 versus December 31, 2013.
Year Ended December 31, Variance Due To:
2014 2013
Favorable/
(unfavorable)
Volume, net of
contractual
price
reductions FX
Commodity
pass-
through Other Total
(in millions) (in millions)
Total net sales ................. $ 15,499 $ 15,051 $ 448 $ 476 $ 12 $ (62) $ 22 $ 448
Total net sales for the year ended December 31, 2014 increased 3% compared to the year ended December 31, 2013. We
experienced volume growth of 5% for the period, primarily as a result of increased sales in North America and Asia Pacific,
partially offset by contractual price reductions.
Cost of Sales
Cost of sales is primarily comprised of material, labor, manufacturing overhead, freight, fluctuations in foreign currency
exchange rates, product engineering, design and development expenses, depreciation and amortization, warranty costs and
other operating expenses. Gross margin is revenue less cost of sales and gross margin percentage is gross margin as a
percentage of net sales.
Cost of sales increased $197 million for the year ended December 31, 2014 compared to the year ended December 31,
2013, as summarized below. The Company's material cost of sales was approximately 50% of net sales in both the year ended
December 31, 2014 and December 31, 2013.