展示99.1
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ボルグワーナーは2024年第3四半期の結果を報告しました
調整後の営業利益率とepsの見通しを拡大
40000万ドルの自社株買い戻し計画を完了
2024年10月31日、ミシガン州オーバーンヒルズ − ボルグワーナー（nyse：BWA）は、本日第三四半期の業績を発表しました。
2024年の第3四半期とガイダンスの更新
•ボルグワーナーは、第3四半期に調整後の営業利益率が10.1％を達成し、これは米国会計基準（US GAAP）に基づく営業利益率が7.8％に相当します。同社は、変動する軽商用車市場を考慮して、運用活動による純現金流入額は3億5600万ドルで、調整後のフリーキャッシュフローは2億1000万ドルにも達しました。
•会社は、強力な第3四半期の業績、継続的なコスト管理、低い実効税率、および会社の第3四半期の株の取得によって駆動され、調整後の営業利益率ガイダンスの中間値を20ベーシスポイント、希薄化後の1株益ガイダンスを摂氏$0.18または4%程度引き上げました。この増加は、市場生産見通しの低下によるものが主な原因で、$15000万のネット売上ガイダンスの中間点を下方修正しました。
•ボルグワーナーは第3四半期中に会社の未払い株式の$30000万を買い戻しました。ボルグワーナーは2024年には未払い株式の$40000万を買い戻しました。
新しいビジネスのアップデート
企業は、将来の長期的な利益に寄与することが期待される複数の新規ビジネス賞を獲得しました。
•次世代フルサイズピックアップトラック向けに、主要な北米OEmから2つのトランスファーケースの受賞を受けました。このビジネスは2027年および2028年に立ち上げ予定です。
•中国の電気自動車OEm、韓国のOEm、日本のOEmとの高電圧冷媒ヒーターの受賞を三つ受賞しました。このビジネスはそれぞれ2025年、2025年、2028年に開始される予定です。
•ゼネラルモーターズは、Corvette ZR1スポーツカープラットフォームに使用するためのターボチャージャー賞を受賞しました。これは市場で最大の乗用車ツインターボチャージャーになる予定です。
第三四半期のハイライト（継続事業ベース）：
•2023年第3四半期に比べて約5%減少した344,900万ドルのGAAP米国売上高。
・外貨の影響とM＆Aの純影響を除くと、第3四半期2023年と比較して、有機売上高は5.1%減少しました。
•希薄化後1株あたりの米国企業会計基準における純利益は1.08ドルです。
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・希薄化後の株当たり利益に関連する希薄化後の株当たり利益を含まないネット利益（下の表に詳細あり）を除いた場合、調整後の純利益は希薄化後の株当たり1.09ドルでした。
•米国のGAAPに基づく営業利益は2億7000万ドル、売上高の7.8％です。
非比較アイテムに関連する税引前経費の$8000万を除いて、調整後の営業利益は$35000万、売上高の10.1%となりました。
•オペレーティングアクティビティからの純現金の提供額は35600万ドルです。
フリーキャッシュフローは$20,100万です。
財務結果（継続営業基準）:
企業は、以下の表が、米国会計基準（U.S. GAAP）希薄化後1株当たり当期利益に影響を与えた比較不可能な項目を強調するのに役立つと考えています。以下に示されている比較不可能な項目は、各項目に対してそれぞれの税率を使用して税引後で計算され、提出期間の希薄化後株式加重平均数を使用しています。企業は、調整後の希薄化後1株当たり利益を再構築費用、合併、買収および事業切り離し費用、その他の純費用、中断された業務、企業の運営に反映されていないその他の利益および損失、および関連税効果の影響を除外して調整した希薄化後1株当たり利益と定義しています。
| 9月30日までの3か月間 | 9月30日までの9ヶ月間 | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| 希薄化後の1株当たりの利益 | $ | 1.08 | $ | 0.37 | $ | 3.40 | $ | 2.06 | |||||||||||||||
| 非比較アイテム: | |||||||||||||||||||||||
| リストラ費用 | 0.07 | 0.17 | 0.21 | 0.21 | |||||||||||||||||||
| 加速償却費 | 0.10 | — | 0.13 | 0.01 | |||||||||||||||||||
| 商業契約の決済 | 0.02 | — | 0.06 | — | |||||||||||||||||||
| スピンオフ関連残高に関連する調整 | 0.01 | — | 0.06 | — | |||||||||||||||||||
| 事業売却に伴う損失（利益） | 0.03 | — | 0.02 | (0.02) | |||||||||||||||||||
| 団体交渉契約承認ボーナス | 0.01 | — | 0.01 | — | |||||||||||||||||||
| 債務の償還による利益 | (0.01) | (0.09) | (0.01) | (0.09) | |||||||||||||||||||
| 合併および買収費用（純額） | (0.02) | 0.01 | — | 0.07 | |||||||||||||||||||
| 資産減損およびリース修正 | — | — | — | 0.03 | |||||||||||||||||||
| 資産の売却益 | — | (0.03) | — | (0.04) | |||||||||||||||||||
| 株式および債券・債務証券の未実現および実現（利益）損失 | (0.01) | 0.32 | — | 0.55 | |||||||||||||||||||
| スピンオフからの企業シナジー | — | — | — | 0.03 | |||||||||||||||||||
| 税調整 | (0.23) | 0.18 | (0.65) | — | |||||||||||||||||||
| その他の非比較アイテム | 0.04 | 0.05 | 0.07 | 0.03 | |||||||||||||||||||
| 希薄化後1株当たり調整後収益 | $ | 1.09 | $ | 0.98 | $ | 3.30 | $ | 2.84 | |||||||||||||||
2024年第3四半期の純売上高は3億4490万ドルで、前年同期の第3四半期比約5%減少しました。これは、主に市場生産量の減少に起因しています。2024年第3四半期の純利益は2億4200万ドルで、1株当たり希薄化後のシェアで1.08ドルとなりました。これに対し、2023年第3四半期の純利益は8700万ドルで、1株当たり希薄化後のシェアが0.37ドルでした。2024年第3四半期の調整後の1株当たり希薄化後のシェアは、2023年第3四半期の調整後の1株当たり希薄化後のシェア0.98ドルから上昇し、1.09ドルとなりました。2024年第3四半期の調整後の純利益には、1株当たり希薄化後のシェア当たり$(0.01)の非比較アイテムが除外されました。一方、2023年第3四半期の調整後の純利益には、非比較アイテムが除外されました
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希薄化後1株当たり$(0.61)の調整後シェアが増加したのは、主に強力な運用実績、継続的なコスト管理、顧客回復、低い税率、および企業の株の取得に起因しています。これらの項目は、上記の表にリストされており、その他の結果や最も直接関連する米国のGAAP基準との比較のために会社によって提供されています。
2024年のフルイヤーガイダンス： 企業は、2024年の売上、利益率、およびEPSのガイダンスを更新しました。2024年の純売上高は、$14.0億から$14.2億の範囲である見込みで、これは企業のこれまでのガイダンスの$141億から$144億および2023年の売上約$142億と比較されます。企業は、2024年の加重軽自動車および商用車市場が前年比で3.5%から3%下落すると予想しており、これは企業のこれまでの3%から2%下落のガイダンスからの減少です。企業の売上ガイダンスは、前年比で約(1.5)%からフラット、または市場生産を上回る推定アウトグロースが約200から300ベーシスポイントであることを意味しています。企業は、2024年のe製品の売上を約$24億と見込んでおり、これは2023年の約$20億からの増加です。外貨の為替変動により、ユーロの強化による約$20百万の売上減少が予想されますが、これは韓国ウォンと中国人民元が米ドルに対して弱まったことによって相殺されます。SSEおよびエルドール社の電動ハイブリッドシステム事業部の買収により、年初から売上が約$3000万増加する見込みです。
通年の営業利益率は8.1％から8.2％の範囲になる見込みです。非比較項目の影響を除いた調整後の営業利益率は9.8％から10.0％の範囲になる見込みで、前回の会社のガイダンスである9.6％から9.8％から上方修正されています。純利益は希薄化後の1株あたり$4.17から$4.28の範囲で見込まれています。非比較項目の影響を除いた調整後の純利益は希薄化後の1株あたり$4.15から$4.30の範囲で見込まれており、会社の以前のガイダンスである希薄化後の1株あたり$3.95から$4.15から上方修正されています。通期の営業キャッシュフローは$132500万から$137500万の範囲で見込まれており、フリーキャッシュフローは$47500万から$57500万の範囲になる見込みです。
At 9:30 a.m. ET today, a brief conference call concerning third quarter 2024 results and guidance will be webcast at: https://www.borgwarner.com/investors. Additionally, an earnings call presentation will be available at https://www.borgwarner.com/investors.
For more than 130 years, BorgWarner Inc. (NYSE: BWA) has been a transformative global product leader bringing successful mobility innovation to market. Today, we’re accelerating the world’s transition to eMobility -- to help build a cleaner, healthier, safer future for all.
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Forward Looking Statements: This release may contain forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act that are based on management’s current outlook, expectations, estimates and projections. Words such as “anticipates,” “believes,” “continues,” “could,” “designed,” “effect,” “estimates,” “evaluates,” “expects,” “forecasts,” “goal,” “guidance,” “initiative,” “intends,” “may,” “outlook,” “plans,” “potential,” “predicts,” “project,” “pursue,” “seek,” “should ,” “target,” “when,” “will,” “would,” and variations of such words and similar expressions are intended to identify such
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forward-looking statements. Further, all statements, other than statements of historical fact, contained or incorporated by reference in this release that we expect or anticipate will or may occur in the future regarding our financial position, business strategy and measures to implement that strategy, including changes to operations, competitive strengths, goals, expansion and growth of our business and operations, plans, references to future success and other such matters, are forward-looking statements. Accounting estimates, such as those described under the heading “Critical Accounting Policies and Estimates” in Item 7 of our most recently filed Annual Report on Form 10-K (“Form 10-K”), are inherently forward-looking. All forward-looking statements are based on assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. Forward-looking statements are not guarantees of performance, and the Company’s actual results may differ materially from those expressed, projected or implied in or by the forward-looking statements.
You should not place undue reliance on these forward-looking statements, which speak only as of the date of this release. Forward-looking statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond our control, that could cause actual results to differ materially from those expressed, projected or implied in or by the forward-looking statements. These risks and uncertainties, among others, include: supply disruptions impacting us or our customers, commodity availability and pricing, and an inability to achieve expected levels of recoverability in commercial negotiations with customers concerning these costs; competitive challenges from existing and new competitors, including original equipment manufacturer (“OEM”) customers; the challenges associated with rapidly changing technologies, particularly as they relate to electric vehicles, and our ability to innovate in response; the difficulty in forecasting demand for electric vehicles and our electric vehicles revenue growth; potential disruptions in the global economy caused by wars or other geopolitical conflicts; the ability to identify targets and consummate acquisitions on acceptable terms; failure to realize the expected benefits of acquisitions on a timely basis; the possibility that our 2023 tax-free spin-off of our former Fuel Systems and Aftermarket segments into a separate publicly traded company will not achieve its intended benefits; the failure to promptly and effectively integrate acquired businesses; the potential for unknown or inestimable liabilities relating to the acquired businesses; our dependence on automotive and truck production, which is highly cyclical and subject to disruptions; our reliance on major OEM customers; impacts of any future strikes involving any of our OEM customers and any actions such OEM customers take in response; fluctuations in interest rates and foreign currency exchange rates; our dependence on information systems; the uncertainty of the global economic environment; the outcome of existing or any future legal proceedings, including litigation with respect to various claims, or governmental investigations, including related litigation; future changes in laws and regulations, including, by way of example, taxes and tariffs, in the countries in which we operate; impacts from any potential future acquisition or disposition transactions; and the other risks noted in reports that we file with the Securities and Exchange Commission, including Item 1A, “Risk Factors” in our most recently filed Form 10-K and/or Quarterly Report on Form 10-Q. We do not undertake any obligation to update or announce publicly any updates to or revisions to any of the forward-looking statements in this release to reflect any change in our expectations or any change in events, conditions, circumstances, or assumptions underlying the statements.
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| BorgWarner Inc. | |||||||||||||||||||||||
| Condensed Consolidated Statements of Operations (Unaudited) | |||||||||||||||||||||||
| (in millions, except per share amounts) | |||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Net sales | $ | 3,449 | $ | 3,622 | $ | 10,647 | $ | 10,676 | |||||||||||||||
| Cost of sales | 2,813 | 2,970 | 8,682 | 8,767 | |||||||||||||||||||
| Gross profit | 636 | 652 | 1,965 | 1,909 | |||||||||||||||||||
| Gross margin | 18.4 | % | 18.0 | % | 18.5 | % | 17.9 | % | |||||||||||||||
| Selling, general and administrative expenses | 340 | 330 | 1,010 | 963 | |||||||||||||||||||
| Restructuring expense | 21 | 56 | 65 | 68 | |||||||||||||||||||
| Other operating expense (income), net | 5 | (6) | 28 | (1) | |||||||||||||||||||
| Operating income | 270 | 272 | 862 | 879 | |||||||||||||||||||
| Equity in affiliates’ earnings, net of tax | (6) | (10) | (23) | (23) | |||||||||||||||||||
| Unrealized and realized (gain) loss on equity and debt securities | (2) | 60 | — | 129 | |||||||||||||||||||
| Interest expense (income), net | 4 | (19) | 17 | 3 | |||||||||||||||||||
| Other postretirement expense | 4 | 3 | 10 | 8 | |||||||||||||||||||
| Earnings from continuing operations before income taxes and noncontrolling interest | 270 | 238 | 858 | 762 | |||||||||||||||||||
| Provision for income taxes | 13 | 133 | 44 | 230 | |||||||||||||||||||
| Net earnings from continuing operations | 257 | 105 | 814 | 532 | |||||||||||||||||||
| Net loss from discontinued operations | (8) | (37) | (27) | (12) | |||||||||||||||||||
| Net earnings | 249 | 68 | 787 | 520 | |||||||||||||||||||
| Net earnings from continuing operations attributable to noncontrolling interest | 15 | 18 | 44 | 49 | |||||||||||||||||||
| Net earnings attributable to BorgWarner Inc. | $ | 234 | $ | 50 | $ | 743 | $ | 471 | |||||||||||||||
| Amounts attributable to BorgWarner Inc.: | |||||||||||||||||||||||
| Net earnings from continuing operations | $ | 242 | $ | 87 | $ | 770 | $ | 483 | |||||||||||||||
| Net loss from discontinued operations | (8) | (37) | (27) | (12) | |||||||||||||||||||
| Net earnings attributable to BorgWarner Inc. | $ | 234 | $ | 50 | $ | 743 | $ | 471 | |||||||||||||||
| Earnings per share from continuing operations — basic | $ | 1.08 | $ | 0.37 | $ | 3.41 | $ | 2.07 | |||||||||||||||
| Loss per share from discontinued operations — basic | (0.04) | (0.16) | (0.12) | (0.05) | |||||||||||||||||||
| Earnings per share attributable to BorgWarner Inc. — basic | $ | 1.04 | $ | 0.21 | $ | 3.29 | $ | 2.02 | |||||||||||||||
| Earnings per share from continuing operations — diluted | $ | 1.08 | $ | 0.37 | $ | 3.40 | $ | 2.06 | |||||||||||||||
| Loss per share from discontinued operations — diluted | (0.04) | (0.16) | (0.12) | (0.05) | |||||||||||||||||||
| Earnings per share attributable to BorgWarner Inc. — diluted | $ | 1.04 | $ | 0.21 | $ | 3.28 | $ | 2.01 | |||||||||||||||
| Weighted average shares outstanding: | |||||||||||||||||||||||
| Basic | 223.1 | 233.4 | 225.7 | 233.2 | |||||||||||||||||||
| Diluted | 224.5 | 235.3 | 226.8 | 234.6 | |||||||||||||||||||
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| BorgWarner Inc. | |||||||||||||||||||||||
| Net Sales by Reportable Segment (Unaudited)* | |||||||||||||||||||||||
| (in millions) | |||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Turbos & Thermal Technologies | $ | 1,386 | $ | 1,474 | $ | 4,475 | $ | 4,570 | |||||||||||||||
| Drivetrain & Morse Systems | 1,365 | 1,449 | 4,226 | 4,146 | |||||||||||||||||||
| PowerDrive Systems | 512 | 571 | 1,412 | 1,624 | |||||||||||||||||||
| Battery & Charging Systems | 197 | 146 | 567 | 395 | |||||||||||||||||||
| Inter-segment eliminations | (11) | (18) | (33) | (59) | |||||||||||||||||||
| Net sales | $ | 3,449 | $ | 3,622 | $ | 10,647 | $ | 10,676 | |||||||||||||||
| Segment Adjusted Operating Income (Loss) (Unaudited)* | |||||||||||||||||||||||
| (in millions) | |||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Turbos & Thermal Technologies | $ | 202 | $ | 214 | $ | 654 | $ | 660 | |||||||||||||||
| Drivetrain & Morse Systems | 251 | 253 | 770 | 700 | |||||||||||||||||||
| PowerDrive Systems | (19) | (20) | (130) | (74) | |||||||||||||||||||
| Battery & Charging Systems | (8) | (26) | (33) | (76) | |||||||||||||||||||
| Segment Adjusted Operating Income | 426 | 421 | 1,261 | 1,210 | |||||||||||||||||||
| Corporate, including stock-based compensation | 76 | 72 | 196 | 194 | |||||||||||||||||||
| Restructuring expense | 21 | 56 | 65 | 68 | |||||||||||||||||||
| Intangible asset amortization expense | 17 | 17 | 51 | 51 | |||||||||||||||||||
| Accelerated depreciation | 27 | 1 | 35 | 4 | |||||||||||||||||||
| Commercial contract settlement | — | — | 15 | — | |||||||||||||||||||
| Adjustments associated with Spin-Off related balances | 3 | — | 14 | — | |||||||||||||||||||
| Collective bargaining agreement ratification bonus | 4 | — | 4 | — | |||||||||||||||||||
| Loss (gain) on sale of businesses | 6 | — | 3 | (5) | |||||||||||||||||||
| Merger and acquisition expense, net | (5) | 2 | — | 18 | |||||||||||||||||||
| Asset impairment and lease modification | — | 2 | — | 11 | |||||||||||||||||||
| Gain on sale of assets | — | (7) | — | (13) | |||||||||||||||||||
| Other non-comparable items | 7 | 6 | 16 | 3 | |||||||||||||||||||
| Equity in affiliates’ earnings, net of tax | (6) | (10) | (23) | (23) | |||||||||||||||||||
| Unrealized and realized (gain) loss on equity and debt securities | (2) | 60 | — | 129 | |||||||||||||||||||
| Interest expense (income), net | 4 | (19) | 17 | 3 | |||||||||||||||||||
| Other postretirement expense | 4 | 3 | 10 | 8 | |||||||||||||||||||
| Earnings from continuing operations before income taxes and noncontrolling interest | $ | 270 | $ | 238 | $ | 858 | $ | 762 | |||||||||||||||
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| * | Effective July 1, 2024, the Company implemented a new business unit and management structure designed to further enhance the execution of the Company’s Charging Forward strategy. The Company now reports its results in the following four reportable segments: Turbos & Thermal Technologies, Drivetrain & Morse Systems, PowerDrive Systems (formerly ePropulsion) and Battery & Charging Systems. The reportable segment disclosures have been updated accordingly which included recasting prior period information for the new reporting structure. | |||||||||||||
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| BorgWarner Inc. | |||||||||||
| Condensed Consolidated Balance Sheets (Unaudited) | |||||||||||
| (in millions) | |||||||||||
| September 30, 2024 | December 31, 2023 | ||||||||||
| ASSETS | |||||||||||
| Cash and cash equivalents | $ | 2,000 | $ | 1,534 | |||||||
| Receivables, net | 3,215 | 3,109 | |||||||||
| Inventories, net | 1,366 | 1,313 | |||||||||
| Prepayments and other current assets | 275 | 261 | |||||||||
| Total current assets | 6,856 | 6,217 | |||||||||
| Property, plant and equipment, net | 3,814 | 3,783 | |||||||||
| Other non-current assets | 4,467 | 4,453 | |||||||||
| Total assets | $ | 15,137 | $ | 14,453 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| Short-term debt | $ | 398 | $ | 73 | |||||||
| Accounts payable | 2,176 | 2,546 | |||||||||
| Other current liabilities | 1,144 | 1,148 | |||||||||
| Total current liabilities | 3,718 | 3,767 | |||||||||
| Long-term debt | 4,195 | 3,707 | |||||||||
| Other non-current liabilities | 872 | 913 | |||||||||
| Total liabilities | 8,785 | 8,387 | |||||||||
| Total BorgWarner Inc. stockholders’ equity | 6,156 | 5,828 | |||||||||
| Noncontrolling interest | 196 | 238 | |||||||||
| Total equity | 6,352 | 6,066 | |||||||||
| Total liabilities and equity | $ | 15,137 | $ | 14,453 | |||||||
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| BorgWarner Inc. | |||||||||||
| Condensed Consolidated Statements of Cash Flows (Unaudited) | |||||||||||
| (in millions) | |||||||||||
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| OPERATING ACTIVITIES OF CONTINUING OPERATIONS | |||||||||||
| Net cash provided by operating activities from continuing operations | $ | 700 | $ | 510 | |||||||
| INVESTING ACTIVITIES OF CONTINUING OPERATIONS | |||||||||||
| Capital expenditures, including tooling outlays | (510) | (624) | |||||||||
| Payments for businesses acquired, net of cash acquired | — | (31) | |||||||||
| Proceeds from settlement of net investment hedges, net | 46 | 25 | |||||||||
| (Payments for) proceeds from investments in equity and debt securities, net | (7) | 63 | |||||||||
| Proceeds from the sale of business, net | 8 | — | |||||||||
| Proceeds from asset disposals and other, net | 3 | 29 | |||||||||
| Net cash used in investing activities from continuing operations | (460) | (538) | |||||||||
| FINANCING ACTIVITIES OF CONTINUING OPERATIONS | |||||||||||
| Net increase in notes payable | — | 3 | |||||||||
| Additions to debt | 1,000 | 4 | |||||||||
| Payments for debt issuance costs | (9) | (3) | |||||||||
| Repayments of debt, including current portion | (175) | (444) | |||||||||
| Payments for purchase of treasury stock | (401) | — | |||||||||
| Payments for stock-based compensation items | (23) | (25) | |||||||||
| Payments for businesses acquired, net of cash acquired | (4) | — | |||||||||
| Payments for contingent consideration | (1) | (23) | |||||||||
| Purchase of noncontrolling interest | — | (15) | |||||||||
| Net distribution from PHINIA | — | 401 | |||||||||
| Dividends paid to BorgWarner stockholders | (74) | (105) | |||||||||
| Dividends paid to noncontrolling stockholders | (63) | (71) | |||||||||
| Net cash provided by (used in) financing activities from continuing operations | 250 | (278) | |||||||||
| CASH FLOWS FROM DISCONTINUED OPERATIONS | |||||||||||
| Operating activities of discontinued operations | (27) | (66) | |||||||||
| Investing activities of discontinued operations | — | (86) | |||||||||
| Financing activities of discontinued operations | — | 84 | |||||||||
| Net cash used in discontinued operations | (27) | (68) | |||||||||
| Effect of exchange rate changes on cash | 3 | (15) | |||||||||
| Net increase (decrease) in cash and cash equivalents | 466 | (389) | |||||||||
| Cash and cash equivalents at beginning of year | 1,534 | 1,338 | |||||||||
| Cash and cash equivalents at end of period | $ | 2,000 | $ | 949 | |||||||
| Less: Cash and cash equivalents of discontinued operations at end of period | $ | — | $ | — | |||||||
| Cash and cash equivalents of continuing operations at end of period | $ | 2,000 | $ | 949 | |||||||
| Supplemental Information (Unaudited) | |||||||||||
| (in millions) | |||||||||||
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| Depreciation and tooling amortization | $ | 444 | $ | 376 | |||||||
| Intangible asset amortization | $ | 51 | $ | 51 | |||||||
8
Non-GAAP Financial Measures
This press release contains information about BorgWarner’s financial results that is not presented in accordance with accounting principles generally accepted in the United States (“GAAP”). Such non-GAAP financial measures are reconciled to their closest GAAP financial measures below and in the Financial Results table above. The provision of these comparable GAAP financial measures for 2024 is not intended to indicate that BorgWarner is explicitly or implicitly providing projections on those GAAP financial measures, and actual results for such measures are likely to vary from those presented. The reconciliations include all information reasonably available to the Company at the date of this press release and the adjustments that management can reasonably predict.
Management believes that these non-GAAP financial measures are useful to management, investors, and banking institutions in their analysis of the Company's business and operating performance. Management also uses this information for operational planning and decision-making purposes.
Non-GAAP financial measures are not and should not be considered a substitute for any GAAP measure. Additionally, because not all companies use identical calculations, the non-GAAP financial measures as presented by BorgWarner may not be comparable to similarly titled measures reported by other companies.
Adjusted Operating Income and Adjusted Operating Margin
The Company defines adjusted operating income as operating income adjusted to exclude the impact of restructuring expense, merger, acquisition and divestiture expense, intangible asset amortization expense, other net expenses, discontinued operations, and other gains and losses not reflective of the Company’s ongoing operations. Adjusted operating margin is defined as adjusted operating income divided by net sales.
Adjusted Net Earnings
The Company defines adjusted net earnings as net earnings attributable to BorgWarner Inc. adjusted to eliminate the impact of restructuring expense, merger, acquisition and divestiture expense, other net expenses, discontinued operations, and other gains and losses not reflective of the Company’s ongoing operations, and related tax effects. The impact of intangible asset amortization expense will continue to be included in adjusted net earnings.
Adjusted Earnings per Diluted Share
The Company defines adjusted earnings per diluted share as earnings per diluted share adjusted to eliminate the impact of restructuring expense, merger, acquisition and divestiture expense, other net expenses, discontinued operations, other gains and losses not reflective of the Company’s ongoing operations, and related tax effects. The impact of intangible asset amortization expense continues to be included in adjusted earnings per share.
Free Cash Flow
The Company defines free cash flow as net cash provided by operating activities minus capital expenditures and is useful to both management and investors in evaluating the Company’s ability to service and repay its debt.
9
Organic Net Sales Change
The Company defines organic net sales changes as net sales change year-over-year excluding the estimated impact of foreign exchange (FX) and the acquisitions of the smart grid and smart energy businesses of Hubei Surpass Sun Electric and the Electric Hybrid Systems business segment of Eldor Corporation.
Outgrowth
The Company defines outgrowth as organic net sales change versus the year-over-year change in light and commercial vehicle production weighted for the Company’s geographic exposure, as estimated by the Company.
| Adjusted Operating Income and Adjusted Operating Margin (Unaudited) | |||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| Net sales | $ | 3,449 | $ | 3,622 | $ | 10,647 | $ | 10,676 | |||||||||||||||
| Operating income | $ | 270 | $ | 272 | $ | 862 | $ | 879 | |||||||||||||||
| Operating margin | 7.8 | % | 7.5 | % | 8.1 | % | 8.2 | % | |||||||||||||||
| Non-comparable items: | |||||||||||||||||||||||
| Restructuring expense | $ | 21 | $ | 56 | $ | 65 | $ | 68 | |||||||||||||||
| Intangible asset amortization expense | 17 | 17 | 51 | 51 | |||||||||||||||||||
| Accelerated depreciation | 27 | 1 | 35 | 4 | |||||||||||||||||||
| Commercial contract settlement | — | — | 15 | — | |||||||||||||||||||
| Adjustments associated with Spin-Off related balances | 3 | — | 14 | — | |||||||||||||||||||
| Collective bargaining agreement ratification bonus | 4 | — | 4 | — | |||||||||||||||||||
| Loss (gain) on sale of businesses | 6 | — | 3 | (5) | |||||||||||||||||||
| Merger and acquisition expense, net | (5) | 2 | — | 18 | |||||||||||||||||||
| Asset impairment and lease modification | — | 2 | — | 11 | |||||||||||||||||||
| Gain on sale of assets | — | (7) | — | (13) | |||||||||||||||||||
| Corporate synergy from Spin-Off | — | — | — | 10 | |||||||||||||||||||
| Other non-comparable items | 7 | 6 | 16 | 3 | |||||||||||||||||||
| Adjusted operating income | $ | 350 | $ | 349 | $ | 1,065 | $ | 1,026 | |||||||||||||||
| Adjusted operating margin | 10.1 | % | 9.6 | % | 10.0 | % | 9.6 | % | |||||||||||||||
| Free Cash Flow Reconciliation (Unaudited) | |||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in millions) | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| Net cash provided by operating activities from continuing operations | $ | 356 | $ | 221 | $ | 700 | $ | 510 | |||||||||||||||
| Capital expenditures, including tooling outlays | (155) | (185) | (510) | (624) | |||||||||||||||||||
| Free cash flow | $ | 201 | $ | 36 | $ | 190 | $ | (114) | |||||||||||||||
10
| Third Quarter 2024 Organic Net Sales Change (Unaudited) | |||||||||||||||||||||||||||||||||||
| (in millions) | Q3 2023 Net Sales | FX | Acquisition Impact | Organic Net Sales Change | Q3 2024 Net Sales | Organic Net Sales Change % | |||||||||||||||||||||||||||||
| Turbos & Thermal Technologies | $ | 1,474 | $ | (1) | $ | — | $ | (87) | $ | 1,386 | (5.9)% | ||||||||||||||||||||||||
| Drivetrain & Morse Systems | 1,449 | 2 | — | (86) | 1,365 | (5.9)% | |||||||||||||||||||||||||||||
| PowerDrive Systems | 571 | 2 | 9 | (70) | 512 | (12.3)% | |||||||||||||||||||||||||||||
| Battery & Charging Systems | 146 | 1 | — | 50 | 197 | 34.2% | |||||||||||||||||||||||||||||
| Inter-segment eliminations | (18) | — | — | 7 | (11) | (38.9)% | |||||||||||||||||||||||||||||
| Net sales | $ | 3,622 | $ | 4 | $ | 9 | $ | (186) | $ | 3,449 | (5.1)% | ||||||||||||||||||||||||
Year to Date 2024 Organic Net Sales Change (Unaudited) | |||||||||||||||||||||||||||||||||||
| (in millions) | Q3 2023 YTD Net Sales | FX | Acquisition Impact | Organic Net Sales Change | Q3 2024 YTD Net Sales | Organic Net Sales Change % | |||||||||||||||||||||||||||||
| Turbos & Thermal Technologies | $ | 4,570 | $ | (21) | $ | — | $ | (74) | $ | 4,475 | (1.6)% | ||||||||||||||||||||||||
| Drivetrain & Morse Systems | 4,146 | (52) | — | 132 | 4,226 | 3.2% | |||||||||||||||||||||||||||||
| PowerDrive Systems | 1,624 | (17) | 21 | (216) | 1,412 | (13.3)% | |||||||||||||||||||||||||||||
| Battery & Charging Systems | 395 | — | 5 | 167 | 567 | 42.3% | |||||||||||||||||||||||||||||
| Inter-segment eliminations | (59) | — | — | 26 | (33) | (44.1)% | |||||||||||||||||||||||||||||
| Total | $ | 10,676 | $ | (90) | $ | 26 | $ | 35 | $ | 10,647 | 0.3% | ||||||||||||||||||||||||
| Adjusted Operating Income and Adjusted Operating Margin Guidance Reconciliation (Unaudited) | |||||||||||
Full-Year 2024 Guidance | |||||||||||
| (in millions) | Low | High | |||||||||
| Net sales | $ | 14,000 | $ | 14,200 | |||||||
| Operating income | 1,128 | 1,158 | |||||||||
| Operating margin | 8.1 | % | 8.2 | % | |||||||
| Non-comparable items: | |||||||||||
| Restructuring expense | $ | 90 | $ | 100 | |||||||
| Intangible asset amortization expense | 70 | 70 | |||||||||
| Accelerated depreciation | 35 | 35 | |||||||||
| Commercial contract settlement | 15 | 15 | |||||||||
| Adjustments associated with Spin-Off related balances | 14 | 14 | |||||||||
| Collective bargaining agreement ratification bonus | 4 | 4 | |||||||||
| Loss on sale of businesses | 3 | 3 | |||||||||
| Other non-comparable items | 16 | 16 | |||||||||
| Adjusted operating income | $ | 1,375 | $ | 1,415 | |||||||
| Adjusted operating margin | 9.8 | % | 10.0 | % | |||||||
11
| Adjusted Earnings Per Diluted Share Guidance Reconciliation (Unaudited) | |||||||||||
Full-Year 2024 Guidance | |||||||||||
| Low | High | ||||||||||
| Earnings per Diluted Share from Continuing Operations | $ | 4.17 | $ | 4.28 | |||||||
| Non-comparable items: | |||||||||||
| Restructuring expense | 0.29 | 0.33 | |||||||||
| Accelerated depreciation | 0.13 | 0.13 | |||||||||
| Commercial contract settlement | 0.06 | 0.06 | |||||||||
| Adjustments associated with Spin-Off related balances | 0.06 | 0.06 | |||||||||
| Loss on sale of businesses | 0.02 | 0.02 | |||||||||
| Collective bargaining agreement ratification bonus | 0.01 | 0.01 | |||||||||
| Gain on debt extinguishment | (0.01) | (0.01) | |||||||||
| Tax adjustments | (0.65) | (0.65) | |||||||||
| Other non-comparable items | 0.07 | 0.07 | |||||||||
| Adjusted Earnings per Diluted Share from Continuing Operations | $ | 4.15 | $ | 4.30 | |||||||
| Free Cash Flow Guidance Reconciliation (Unaudited) | |||||||||||
Full-Year 2024 Guidance | |||||||||||
| (in millions) | Low | High | |||||||||
| Net cash provided by operating activities | $ | 1,325 | $ | 1,375 | |||||||
| Capital expenditures, including tooling outlays | (850) | (800) | |||||||||
| Free cash flow | $ | 475 | $ | 575 | |||||||
| Full Year 2024 Estimated Organic Net Sales Change Guidance and Outgrowth Reconciliation From Continuing Operations (Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | FY 2023 Net Sales | FX | FY 2024 Acquisition Impact | Organic Net Sales Change | FY 2024 Net Sales | Organic Net Sales Change % | LV/CV Weighted Market | Outgrowth | |||||||||||||||||||||||||||||||||||||||
| Low | $ | 14,198 | $ | (20) | $ | 30 | $ | (208) | $ | 14,000 | (1.5)% | (3.5)% | 2.0% | ||||||||||||||||||||||||||||||||||
| High | $ | 14,198 | $ | (20) | $ | 30 | $ | (8) | $ | 14,200 | (0.1)% | (3.0)% | 2.9% | ||||||||||||||||||||||||||||||||||
| Full Year 2024 Estimated Year-Over-Year Change in Production (Unaudited) | ||||||||||||||||||||||||||
| North America | Europe | China | Total | |||||||||||||||||||||||
| Light vehicle | (1.5)% to (0.5)% | (5.5)% to (5)% | 1% to 1.5% | (2.5)% to (2)% | ||||||||||||||||||||||
| Commercial vehicle | ~(4.5)% | ~(15)% | ~2% | ~(2.5)% | ||||||||||||||||||||||
| BorgWarner-Weighted | (2)% to (1)% | (7)% to (6.5)% | 1 to 1.5% | (3.5)% to (3)% | ||||||||||||||||||||||
12
Recast Reportable Segment Information
Effective July 1, 2024, the Company implemented a new business unit and management structure designed to further enhance the execution of the Company’s Charging Forward strategy. The Company now reports its results in the following four reportable segments: Turbos & Thermal Technologies, Drivetrain & Morse Systems, PowerDrive Systems (formerly ePropulsion) and Battery & Charging Systems. The reportable segment disclosures have been updated accordingly which included recasting prior period information for the new reporting structure. For informational purposes only, in the following tables, the Company has recast the quarterly segment information for fiscal 2024 and 2023 to align with this presentation.
| BorgWarner Reportable Segment Information (Unaudited) | |||||||||||
| 2024 | |||||||||||
| (in millions) | Three Months Ended March 31, 2024 | Three Months Ended June 30, 2024 | |||||||||
| Revenue | |||||||||||
| Turbos & Thermal Technologies | $ | 1,574 | $ | 1,515 | |||||||
| Drivetrain & Morse Systems | 1,419 | 1,442 | |||||||||
| PowerDrive Systems | 436 | 464 | |||||||||
| Battery & Charging Systems | 177 | 193 | |||||||||
| Inter-segment eliminations | (11) | (11) | |||||||||
| Net Sales | $ | 3,595 | $ | 3,603 | |||||||
| Cost of sales | 2,951 | 2,918 | |||||||||
| Gross Profit | 644 | 685 | |||||||||
| Gross Margin | 17.9 | % | 19.0 | % | |||||||
| Selling, general and administrative expenses | 329 | 341 | |||||||||
| Restructuring expense | 19 | 25 | |||||||||
| Other operating expense, net | 1 | 22 | |||||||||
| Operating income | 295 | 297 | |||||||||
| Non-comparable items | 44 | 79 | |||||||||
| Adjusted Operating Income (Loss) | |||||||||||
| Turbos & Thermal Technologies | $ | 228 | $ | 224 | |||||||
| Drivetrain & Morse Systems | 253 | 266 | |||||||||
| PowerDrive Systems | (62) | (49) | |||||||||
| Battery & Charging Systems | (15) | (10) | |||||||||
| Corporate & Non-Operating | (65) | (55) | |||||||||
| Adjusted Operating Income | $ | 339 | $ | 376 | |||||||
13
| BorgWarner Reportable Segment Information (Unaudited) | |||||||||||||||||||||||||||||
| 2023 | |||||||||||||||||||||||||||||
| (in millions) | Three Months Ended March 31, 2023 | Three Months Ended June 30, 2023 | Three Months Ended September 30, 2023 | Three Months Ended December 31, 2023 | Year Ended December 31, 2023 | ||||||||||||||||||||||||
| Revenue | |||||||||||||||||||||||||||||
| Turbos & Thermal Technologies | $ | 1,541 | $ | 1,555 | $ | 1,474 | $ | 1,442 | $ | 6,012 | |||||||||||||||||||
| Drivetrain & Morse Systems | 1,266 | 1,431 | 1,449 | 1,403 | 5,549 | ||||||||||||||||||||||||
| PowerDrive Systems | 487 | 566 | 571 | 542 | 2,166 | ||||||||||||||||||||||||
| Battery & Charging Systems | 110 | 139 | 146 | 151 | 546 | ||||||||||||||||||||||||
| Inter-segment eliminations | (21) | (20) | (18) | (16) | (75) | ||||||||||||||||||||||||
| Net Sales | $ | 3,383 | $ | 3,671 | $ | 3,622 | $ | 3,522 | $ | 14,198 | |||||||||||||||||||
| Cost of sales | 2,806 | 2,991 | 2,970 | 2,863 | 11,630 | ||||||||||||||||||||||||
| Gross Profit | 577 | 680 | 652 | 659 | 2,568 | ||||||||||||||||||||||||
| Gross Margin | 17.1 | % | 18.5 | % | 18.0 | % | 18.7 | % | 18.1 | % | |||||||||||||||||||
| Selling, general and administrative expenses | 299 | 334 | 330 | 353 | 1,316 | ||||||||||||||||||||||||
| Restructuring expense | 3 | 9 | 56 | 11 | 79 | ||||||||||||||||||||||||
| Other operating expense (income), net | 1 | 4 | (6) | 14 | 13 | ||||||||||||||||||||||||
| Operating income | 274 | 333 | 272 | 281 | 1,160 | ||||||||||||||||||||||||
| Non-comparable items | 31 | 39 | 77 | 51 | 198 | ||||||||||||||||||||||||
| Adjusted Operating Income (Loss) | |||||||||||||||||||||||||||||
| Turbos & Thermal Technologies | $ | 218 | $ | 228 | $ | 214 | $ | 214 | $ | 874 | |||||||||||||||||||
| Drivetrain & Morse Systems | 201 | 246 | 253 | 258 | 958 | ||||||||||||||||||||||||
| PowerDrive Systems | (35) | (19) | (20) | (16) | (90) | ||||||||||||||||||||||||
| Battery & Charging Systems | (23) | (27) | (26) | (40) | (116) | ||||||||||||||||||||||||
| Corporate & Non-Operating | (56) | (56) | (72) | (84) | (268) | ||||||||||||||||||||||||
| Adjusted Operating Income | $ | 305 | $ | 372 | $ | 349 | $ | 332 | $ | 1,358 | |||||||||||||||||||
14