BorgWarner Q1 Net Jumps On Lower Investment Losses, Beats Estimates

(RTTNews) - Auto parts business BorgWarner Inc. (BWA) on Wednesday reported first quarter results that showed earnings leap on lower unrealized losses on equities. Earnings as well as revenues exceeded The Street's expectations.

Net earnings for the period were $200 million or $0.84 per share as compared to $65 million or $0.27 per share in the first quarter of the previous year. The comparative growth in earnings is attributed to lower unrealized losses on equity securities in the current quarter.

Earnings excluding items for the period decreased to $1.05 per share as compared to $1.21 per share in the first quarter of the previous year. The decrease in adjusted net earnings was primarily due to the impact of lower revenue, higher commodity costs, and the AKASOL AG acquisition.

18 analysts polled by Thomson Reuters were expecting the company to report earnings of $0.87 per share. Analysts typically exclude one-time items.

Net sales for the period decreased 3 percent to $3.9 billion, from $4 billion in the first quarter of 2021.

15 analysts polled by Thomson Reuters were expecting the company to report revenues of $3.71 billion.

Operating income also decreased to $352 million, from $403 million in the year-ago period.

In 2022, the company expects net sales between $15.5 billion and $16.0 billion, compared to 2021 sales of $14.8 billion and implying an organic sales growth of 10 to 13 percent. Weighted light and commercial vehicle markets are expected to increase between 2.5 percent and 5 percent. A decrease of $650 million in sales is anticipated due to the weakening of Euro, Korean Won and Chinese Renminbi against the U.S. Dollar.

Operating margin for 2022 is expected between 8.5 percent and 9.0 percent whereas adjusted operating margin is expected between 9.8 percent and 10.2 percent.

Net earnings are expected between $3.39 and $3.77 per share. Adjusted earnings are seen between $3.90 and $4.25 per share.

Shares of BorgWarner are currently trading in pre-market at $38.20, up $0.06 or 0.16 percent from the previous close.