AURORA, Ont.: Magna International Inc. raised its dividend 10% Feb. 23 after reporting fatter net profits in the latest quarter as Canadas largest auto parts maker benefited from a recovery in the North American auto sector.

The Aurora, Ont., company said after markets closed that net profits rose to US$312 million, or $1.32 per share in the three months ended Dec. 31.

That beat analyst expectations for the big industrial company, which operates around the world and is a major supplier to the Detroit Three automakers and companies such as Volkswagen and other European carmakers.

The quarterly profits were 42% higher than the $219 million, or 89 cents per share, Magna earned in the same year-earlier period.

Sales grew 13% to nearly $7.3 billion from $6.4 billion, meeting analyst expectations.

In a related move, the company said it is boosting its dividend 10% to 27.5 cents a share from 25 cents and will be paid March 12. As the company has improved its financial performance in recent years, it is routinely boosting its payment to shareholders.

Magna slightly increased its outlook for North American vehicle production this year from 13.6 million units to 13.8 million units compared to its early January forecast.

That means North American sales are predicted to be between $13.4 billion and $13.9 billion in 2012, compared to the earlier range of $13.2 billion and $13.7 billion.

Its expectation for Western Europe vehicle production remains at 13 million units, with sales expected to range between $8.4 billion and $8.7 billion.

Magna and other auto parts companies are feeling pressure from the loonies continued strength, which is driving Canadian labour costs higher and making Canadian parts more expensive for other countries.

© 2012 The Canadian Press