BorgWarner has raised its earnings expectations for 2010 by close to 50% after the components company registered a strong start to the year with its first quarter results.
The company said today (29 April) that it achieved first quarter earnings of $0.63 per diluted share compared with a net loss of $0.06 a year ago. Sales were up 57% from first quarter 2009 as growing demand for its fuel-efficient technologies, along with strengthening global production volumes, boosted results.
In a statement, BorgWarner said it was increases 2010 earnings expectation by approximately 50% to $2.20 to $2.50 per diluted share, up from $1.40 to $1.70 per diluted share. It also said it now expects revenue growth of 28% to 32% compared with 2009, up from previous revenue growth guidance of 15% to 19%.
“Strong sales growth combined with cost controls drove first quarter results,” said Timothy Manganello, chairman and CEO of BorgWarner. “Growing demand for our technology around the world and improved volumes in our base business drove higher sales. Most notably, our sales in Asia more than doubled from the same period a year ago. We successfully controlled costs while growing our sales during the quarter, resulting in a solid operating income margin of 8.3%. Our earnings performance of $0.65 per diluted share, excluding non-recurring items, in first quarter 2010 was a significant improvement from the same period a year ago.”
He added: “Production levels in first quarter 2010 were stronger than expected and demand appears to be based on fundamental improvements in the market. The pace of recovery in North American production volumes continues to accelerate, we see a favorable shift in Europe toward vehicles with higher BorgWarner content, including diesels, and our sales growth in Asia continues to gain momentum.”
Full details on BorgWarner’s Q1 results can be found here.