Autoliv's net sales for the third quarter of 2015 was down 1.1% to SEK2.18bn (US$256.35m) compared with SEK2.20bn in the same period year ago. Operating income was down 9.7% to SEK157.8m compared with SEK174.8m. Income before taxes was down 3% to SEK151.8m compared with SEK156.5m. Net income was down 7.1% to SEK99.1m compared with SEK106.7m in the year ago period.
Autoliv's net sales for the first nine months of 2015 were down 3.4% to SEK6.65bn compared with SEK6.88bn. Operating income was down 11.7% to SEK446.5m compared with SEK505.9m. Income before taxes was down 11.4% to SEK410.8m compared with SEK463.7m. Net income was down 15.4% to SEK271.6m compared with SEK321m in the same period in 2014.
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Jan Carlson, chairman, president and CEO of Autoliv said, "During the third quarter, we delivered more than 8% organic sales growth, including 36% growth in our important active safety business. The adjusted operating margin improved year-over-year to 9.4%. In addition adjusted earnings per share grew by 22%. I am pleased with Autoliv's overall performance in the quarter."
"Our strong growth outperformed the light vehicle production in all regions. We saw double digit growth in Europe, Japan and the Rest of Asia, which combined account for around half of Autoliv's total sales. In Europe, active safety and sales of passive safety products to volume manufacturers were the strongest growth drivers."
"In China, we performed better than the light vehicle production. However, given the current uncertainty, we continue to implement short term measures, including adjusting manufacturing capacity to mitigate the margin effect from fluctuating volumes. At the same time we continue to prepare for a more normalized growth situation by strengthening our engineering capabilities."
"During the quarter we executed toward our mission of being the leading safety supplier for the future car. We closed the previously announced acquisition of MACOM's automotive business and launched the important Electronic Horizon product at the ITS show in France. We signed an agreement (subject to closing) with the intent to form a joint venture in the area of brake control systems with Nissin-Kogyo. We also became a participant in the Drive Me program, a cooperation between several parties including Volvo Car Corporation, academic institutions and authorities where we will collaborate on the road to self-driving vehicles."
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By GlobalData"At our Capital Markets Day in early October, we set the course towards the end of the decade by setting our financial targets for growth, margins and earnings per share. At the event we also demonstrated our industry leading active safety portfolio which will play a vital role in delivering 'Real Life Safety' in the years to come."
Outlook
Mainly based on the company's customer call-offs it expects organic sales for the fourth quarter of 2015 to grow by around 9% compared to the same quarter of 2014. Currency translations are expected to have a negative effect of more than 6%, resulting in a consolidated sales growth of more than 3%. The adjusted operating margin, excluding costs for capacity alignments and antitrust related matters, is expected to be around10.5%.
The expectation for the full year 2015 is for an organic sales growth of around 7%. Consolidated sales are expected to decline by around 2% as negative effects from currency translations are expected to be around 9%. The expectation for the full year adjusted operating margin is around 9.5%, excluding costs for capacity alignments and antitrust related matters.
Autoliv has agreements with several OEMs for supply of replacement airbag inflators for delivery. Based on customer agreements and own expectations the company estimates delivery volumes of up to 20m units mainly in 2015 and 2016. It remains too early in this evolving situation to be able to estimate final volumes.
Its capacity alignment programme continues and the company continues to expect the costs for the program to be more than $90m for the full year 2015.
The projected tax rate, excluding any discrete items, for the full year 2015 is now expected to be around 32% and is subject to change due to any other discrete or nonrecurring events that may occur.
It still expects operational cash flow for the full year to remain strong and to be around $0.8bn excluding antitrust related matters and any other discrete items. Capital expenditures in support of its growth strategy are expected to be 5-6% of sales for the full year, which is an increase from the normal level of 4-5% of sales mainly due to the replacement inflator business.
