With strong demand driven by its global customer base and new business, BorgWarner Inc. expects second quarter earnings in a range of $US1.55 to $1.65 per share.
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Expecting this strength to be sustained over the course of 2002, the company this week raised its earnings guidance for the year by 10% to $5.50 per share on an expected 10% sales increase.
The company’s previous guidance for 2002 was EPS of $4.90 to $5.10 per share on a 5% sales increase. Earnings guidance is before the cumulative effect of the change in accounting principle for goodwill.
“Unlike some of our industry peers, our strength is not driven by any particular customer or region,” said John F. Fiedler, chairman and CEO.
“Our focused powertrain technology strategy is paying off, with new and expanded customer relationships around the globe. With our anticipated new business of $1.1 billion over the next three years, we expect to grow faster than the industry and are not dependent on increased vehicle production for improved results.”
Fiedler noted that Honda, General Motors and VW/Audi are expected to account for 50% of the company’s $200 million in anticipated new business in 2002.
The company is also benefiting from improving results at DaimlerChrysler and the rapid growth of Hyundai and Kia.
“The high cost of fuel and stricter emissions regulations are driving the need for more fuel-efficient engines with our turbochargers and engine timing systems in Europe,” he said.
“In North America, concerns about vehicle stability and the growth of the new cross-over vehicle market are reinvigorating our four-wheel drive business.”
BorgWarner expects to release its second quarter 2002 results on July 22.
