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Last Update: 31-Oct-12 08:52 ET
Borg Warner shares little changed following downside guidance
Borg Warner (BWA $63.71 +0.00) reported third quarter earnings of $1.19 per share, excluding non-recurring items, in-line with the Capital IQ consensus of $1.19, while revenues fell 5.4% year/year to $1.7 billion versus the $1.82 billion consensus. The company lowered guidance for fiscal year 2012 with EPS of $4.90-5.00, excluding non-recurring items from prior guidance of $5.00-5.25, versus the $5.11 consensus and lowered fiscal year 2012 revenues of growth of +0-1% calc to $7.114-7.185 billion from prior guidance of 4-6% growth versus $7.42 billion consensus. Engine segment net sales were $1,168 million in third quarter 2012 compared with $1,258 million in third quarter 2011. Drivetrain segment net sales were $534 million in third quarter 2012, compared with $539 million in the prior year's quarter.
Q3 Commentary: "Despite declines in light vehicle production in Europe, our largest market, the focus on fuel economy and improved emissions around the globe continued to drive growth for BorgWarner. Excluding the impact of foreign currencies and 2011 dispositions, our net sales were up approximately 2% in the third quarter compared with third quarter 2011, in line with global light vehicle production growth of 2%. Light vehicle production in Europe, a geographic market that comprises over half of our sales, was down 6%. In a challenging sales environment, we did an excellent job managing costs, which resulted in a solid operating income margin of 11.3%, excluding non-comparable items."
Guidance Commentary: "Based on weakening global economic conditions, particularly in Europe, the company adjusted its net sales and net earnings guidance for 2012. "Our outlook for Europe, our largest market, has deteriorated due to the general economic slowdown across the continent and its impact on the automotive industry. Despite this, we expect to deliver record earnings this year,"
Q3 Commentary: "Despite declines in light vehicle production in Europe, our largest market, the focus on fuel economy and improved emissions around the globe continued to drive growth for BorgWarner. Excluding the impact of foreign currencies and 2011 dispositions, our net sales were up approximately 2% in the third quarter compared with third quarter 2011, in line with global light vehicle production growth of 2%. Light vehicle production in Europe, a geographic market that comprises over half of our sales, was down 6%. In a challenging sales environment, we did an excellent job managing costs, which resulted in a solid operating income margin of 11.3%, excluding non-comparable items."
Guidance Commentary: "Based on weakening global economic conditions, particularly in Europe, the company adjusted its net sales and net earnings guidance for 2012. "Our outlook for Europe, our largest market, has deteriorated due to the general economic slowdown across the continent and its impact on the automotive industry. Despite this, we expect to deliver record earnings this year,"
