Autoliv’s net sales for the second quarter ended 30 June 2014 were up 8.4% to US$2.38bn compared with $2.19bn in the same period year ago.
Operating income decreased in the second quarter of 2014 by 28.1% to $139.4m compared with $194m in the 2013 period. The firm’s income before income taxes decreased 36.2% to $122.9m compared with $192.7m. Net income of the company was down 40.3% to $83.2m compared with $139.4m in the year ago period.
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Net sales for the six months ended 30 June 2014 was up 8% to $4.67bn compared with $4.33bn in the 2013 period. Operating income was down 12% to $331.1m compared with $376.4m. Income before taxes decreased 15.3% to $307.2m compared with $362.8m in the year ago period. The company’s net income was also down 19% to $214.3m compared with $264.5m in the 2013 period.
Comments from Jan Carlson, chairman, president and CEO:
“In the second quarter we saw solid growth across our markets, notably North America, Europe and Japan. The exception was Brazil where we saw a sharp decline in light vehicle production. In addition, our main growth engines over the last two years, China and active safety, continued their strong performance.”
“Coming from low production levels, Europe saw its sixth consecutive quarter of growth with European car sales growing by 7% in the first half of 2014. At the moment we see a slow but sustained recovery in Europe. This supports the operational improvement programme in our European steering wheel business which is developing in line with the original plan outlined last year.”
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By GlobalData“The growth in Japan was a positive surprise. At the beginning of the quarter a decline of the light vehicle production was expected as a result of an increase in the Japanese consumption tax. Instead, we saw slight growth and a favourable product mix for Autoliv which led to double digit growth. A sustained recovery in the Japanese economy could also reflect positively on the light vehicle production moving forward.”
“Active safety showed solid growth in the quarter and in order to support the continued growth and development in this business we have decided to increase the development and engineering spending. In the current situation with millions of cars being recalled for safety related reasons the importance of quality cannot be overemphasised. In this environment we continue to further build our position as the industry’s quality leader, as our business is all about saving lives.”
“With these issues in mind we continue the focus on our growth strategy, quality, and execution of the 2014 transition.”
Sales forecast to grow in Q3
Based on the company’s customer call-offs, it expects organic sales for the third quarter of 2014 to grow by around 6% compared to the same quarter of 2013. Currencies are expected to have a positive effect, resulting in a consolidated sales growth of around 7%. The adjusted operating margin, excluding costs for capacity alignments and antitrust matters, is expected to be around 8.5%.
The indication for the full year is for organic sales growth of more than 6% and an operating margin of around 9%, excluding costs for capacity alignments and antitrust matters. Consolidated sales are expected to grow by close to 7% as effects from currencies are expected to be slightly positive.
