BorgWarner has reported fourth quarter net income of US$125m, almost 11% down on the previous year’s total. However, Q4 net sales were US$2,123m in the quarter, up 6.6% from the previous year.
Full year 2015 net sales were put at US$8,023m, down 3.4% from Full year 2015 net earnings were US$610m compared with US$660m in 2014.
BorgWarner CEO James Verrier told analysts in a conference call that the figures are better (Q4 sales up 7%) if the purchase of Remy and exchange rates are taken out. “For the full year sales reported $8 billion, that’s down 3% from 2014. But when we exclude Remy and foreign exchange and Wahler, it was up 4.3%,” he said.
The company has reaffirmed its 2016 full year guidance. Net sales growth is expected to be within a range of 13.2% to 18.3% compared with 2015. Excluding the impact of foreign currencies and the Remy acquisition, net sales growth is expected to be within a range of 2.5% to 5.5%. Operating income, as a percentage of net sales, is expected to be above 12%. Excluding the Remy acquisition, operating income, as a percentage of net sales, is expected to be above 13%.
“I’m pleased that we have largely got the restructuring efforts that we put a lot of work into over the last 18 months behind us so we can get that benefit as we go into the year,” Verrier said.
He also told analysts he was “very, very pleased” with the Remy acquisition. “I think from a strategic perspective this was a really critical transaction for BorgWarner and we’re going to talk more about that through the year,” he said.