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Jun 30, 2024
BorgWarner Q2 2024 Earnings Report
BorgWarner reported strong second-quarter margin and free cash flow, which led to increased full-year adjusted operating margin and EPS guidance.
Key Takeaways
BorgWarner's Q2 2024 results showed an adjusted operating margin of 10.4% and free cash flow of $297 million. The company increased its full-year adjusted operating margin guidance by 30 basis points and adjusted earnings per share guidance by approximately $0.07 per share. Net sales were $3,603 million, a decrease of 2% compared to Q2 2023.
Achieved an adjusted operating margin of 10.4% and a U.S. GAAP operating margin of 8.2%.
Generated $462 million in net cash from operating activities and $297 million in free cash flow.
Increased mid-point full year adjusted operating margin guidance by 30 basis points and adjusted earnings per share guidance by approximately $0.07 per share.
Intends to repurchase $300 million of the Company’s outstanding shares during the second half of 2024.
Revenue by Segment
Forward Guidance
The Company has updated full year sales, margin and EPS guidance.
Positive Outlook
- Net sales for 2024 are expected to be in the range of $14.1 billion to $14.4 billion.
- The Company’s sales guidance implies a year-over-year increase in organic sales of approximately 0.5% to 2.5%.
- The Company expects its 2024 eProduct sales to be near the low-end of the Company’s prior $2.5 billion to $2.8 billion guidance, up from approximately $2.0 billion in 2023.
- Adjusted operating margin is expected to be in the range of 9.6% to 9.8%, up from the Company’s prior guidance of 9.2% to 9.6%.
- Adjusted net earnings are expected to be within a range of $3.95 to $4.15 per diluted share, up from the Company’s prior guidance of $3.80 to $4.15 per diluted share.
Challenges Ahead
- Net sales for 2024 are expected to be in the range of $14.1 billion to $14.4 billion, compared to the Company’s prior guidance of $14.4 billion to $14.9 billion.
- The Company expects its weighted light and commercial vehicle markets to be in the range of down 3% to down 2% year-over-year in 2024, a decrease from the Company’s prior guidance of flat to down 2.5%.
Revenue & Expenses
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Historical Earnings Impact
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Avg. Return Before/After Earnings
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