Autoliv has unveiled third quarter operating profit of US$197m, despite organic sales growth of 2% instead of an expected 4%.

The lower than expected growth was mainly due to the accelerating decline in the European market and a labour strike in South Korea. 

Consolidated sales declined by slightly more than 3% to US$1.9bn due to negative currency effects of 5%. Operating income amounted to US$187m with an operating margin of 9.6%.

Income before taxes amounted to US$175m, net income to US$118m and earnings per share assuming dilution to US$1.23. 

Cash flow from operations amounted to US$131m and to US$32m before financing. 

For the fourth quarter, Autoliv said it expects organic sales growth in the range of 0%-2% and flat consolidated sales with an operating margin of around 9%, excluding costs for capacity alignments and the anti-trust investigations.

The expected organic sales growth is lower than indicated in July primarily due to the accelerated deterioration in European LVP and the tension between Japan and China affecting the Japanese vehicle manufacturers in China. 

In response to the accelerating drop in European LVP, Autoliv said it forecasts capacity alignment costs for the full year, 2012, to reach the higher end of the US$60m-US$80m range communicated in July.

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Margin guidance met on 2% organic sales growth

(Stockholm, Oct. 23, 2012) – – – For the three-month period ended September 30, 2012, Autoliv Inc. (NYSE: ALV and SSE: ALIV.Sdb) – the worldwide leader in automotive safety systems – reported an operating margin, excluding costs for capacity alignments and antitrust investigations, of 10.1% and an operating profit of US$197m, which was in line with its guidance despite organic sales growth of 2% instead of the expected “nearly 4%”. This lower than expected growth was primarily due to the accelerating decline in the European market and a customer labour strike in South Korea. 

Consolidated sales declined by slightly more than 3% to US$1,947m due to negative currency effects of 5%. Operating income amounted to US$187m with an operating margin of 9.6%. Income before taxes amounted to US$175m, net income to US$118m and earnings per share assuming dilution to $1.23. 

Cash flow from operations amounted to US$131m and to US$32m before financing. 

For the fourth quarter, we expect an organic sales growth in the range of 0-2% and flat consolidated sales with an operating margin of around 9%, excluding costs for capacity alignments and the antitrust investigations.

The expected organic sales growth is lower than indicated in July primarily due to the accelerated deterioration in European LVP and the tension between Japan and China affecting the Japanese vehicle manufacturers in China. 

In response to the accelerating drop in European LVP, we expect our capacity alignment costs for the full year 2012 to reach the higher end of the $60m-US$80m range we communicated in July. 

An earnings conference call will be held at 3:00 p.m. (CET) today, October 23. To follow the webcast or to obtain the pin code and phone number, please access www.autoliv.com. The conference slides will be available on our web site as soon as possible following the publication of this earnings report.

 

 

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Original source: http://www.autoliv.com/NewsRoom/Pages/PressReleases.aspx?releaseid=710162