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Dec 31, 2023
BorgWarner Q4 2023 Earnings Report
BorgWarner reported a 6.2% increase in net sales and adjusted net earnings of $0.90 per diluted share for Q4 2023.
Key Takeaways
BorgWarner reported a 6.2% increase in net sales to $3,522 million for the fourth quarter of 2023. U.S. GAAP net earnings were $0.64 per diluted share, with adjusted net earnings at $0.90 per diluted share. The company expects 2024 eProduct sales to grow approximately 25% to 40%.
Net sales increased by 6.2% to $3,522 million compared to Q4 2022.
Organic sales were up 4.4% compared to Q4 2022, excluding the impact of foreign currencies and net M&A.
U.S. GAAP net earnings were $0.64 per diluted share, with adjusted net earnings at $0.90 per diluted share.
Free cash flow was $679 million.
BorgWarner
BorgWarner
Forward Guidance
The Company has provided 2024 full year guidance. Net sales are expected to be in the range of $14.4 billion to $14.9 billion. Net earnings are expected to be within a range of $3.56 to $3.88 per diluted share. Full-year operating cash flow is expected to be in the range of $1,325 million to $1,375 million, while free cash flow is expected to be in the range of $475 million to $575 million.
Positive Outlook
- Net sales are expected to be in the range of $14.4 billion to $14.9 billion, compared with 2023 sales of $14.2 billion.
- Implies a year-over-year organic increase in sales of 1% to 5%.
- Company expects its 2024 eProduct sales to be $2.5 billion to $2.8 billion, up from approximately $2.0 billion in 2023.
- Operating margin is expected to be in the range of 8.5% to 8.9%.
- Net earnings are expected to be within a range of $3.56 to $3.88 per diluted share.
Challenges Ahead
- Weighted light and commercial vehicle markets to be in the range of down (2.5)% to roughly flat in 2024.
- Includes an expected negative adjusted operating income impact due to the acquisition of the electric hybrid systems business segment of Eldor Corporation.
- Adjusted operating margin excluding the impact of the Eldor acquisition, is expected to be in the range of 9.6% to 9.9%.
- Free cash flow is expected to be in the range of $475 million to $575 million.
- Foreign currencies are expected to have a minimal year-over-year impact on full-year 2024 sales.