AUBURN HILLS, Mich.,
Jan. 14, 2015 /PRNewswire/ --
BorgWarner Inc. (NYSE: BWA) today provided its initial guidance for
2015 net sales, earnings per diluted share, operating income as a
percentage of net sales, effective tax rate and free cash flow. The
company also reaffirmed its 2014 earnings per diluted share
guidance and updated its 2014 net sales guidance.
2014 Guidance Update:
- Net sales growth in 2014 compared with 2013, is now expected to
be approximately 11.5%, down from a range of 12% to 13%, due to
weaker foreign currencies and slightly softer than expected
volumes.
- 2014 net earnings guidance of $3.23 to
$3.28 per diluted share, excluding non-recurring items, is
unchanged.
2015 Guidance Highlights:
- Net sales growth of 2% to 6% compared with updated 2014
guidance. Excluding the impact of weaker foreign currencies, net
sales growth is expected to be 9.5% to 12%.
- The company has provided, at the end of this release, a table
to illustrate the impact of net new business, changes in product
pricing, base business growth and foreign currencies on its net
sales growth guidance range.
- Net earnings of $3.35 to $3.55
per diluted share. Excluding the impact of weaker foreign
currencies, net earnings are expected to be $3.60 to $3.75 per diluted share, up 11% to 14%
compared with 2014 net earnings guidance of $3.23 to $3.28 per diluted share, excluding
non-recurring items.
- Operating income as a percentage of net sales above 13%.
- Effective tax rate of 29%.
- Free cash flow within a range of $350
million to $400 million.
"In 2015, we expect another record year for net sales and net
earnings," said James Verrier,
BorgWarner President and CEO. "Our backlog of net new business is
expected to drive net sales growth of 9.5% to 12% in 2015 compared
with 2014, excluding the impact of weaker foreign currencies, as
demand for our product technologies that improve fuel economy,
emissions and performance, continues to accelerate around the
globe."
"We expect the strengthening Dollar to have a meaningful impact
on our 2015 net sales," Verrier continued. "Approximately three
quarters of our net sales are in foreign currencies, notably the
Brazilian Real, Chinese Yuan, Euro, Japanese Yen, Korean Won,
Mexican Peso and Swedish Krona, all of which we expect to be weaker
against the Dollar in 2015 compared with 2014."
The company expects operating income as a percentage of net
sales to be "above 13%" in 2015, up from its guidance of
"approaching 13%" for 2014. The improvement can be largely
attributed to incremental income from higher net sales and an
ongoing focus on managing costs. Strong operational performance is
expected to offset the costs of global growth,
restructuring-related inefficiencies and other inflationary cost
pressures. 2015 is expected to be the sixth straight year in which
operating income as a percentage of net sales has improved.
Today, at approximately 11:00 am
ET, the company will webcast its presentation at the
Deutsche Bank Global Auto Industry Conference in Detroit, Michigan, which will include a
discussion of its guidance. The webcast can be accessed at:
http://www.borgwarner.com/en/Investors/default.aspx.
About BorgWarner
BorgWarner Inc. (NYSE: BWA) is a
product leader in highly engineered components and systems for
powertrains around the world. Operating manufacturing and technical
facilities in 60 locations in 19 countries, the company delivers
innovative powertrain solutions to improve fuel economy, reduce
emissions and enhance performance. For more information, please
visit borgwarner.com.
Statements contained in this news release may contain
forward-looking statements as contemplated by the 1995 Private
Securities Litigation Reform Act that are based on management's
current expectations, estimates and projections. Words such as
"outlook," "expects," "anticipates," "intends," "plans,"
"believes," "estimates," variations of such words and similar
expressions are intended to identify such forward-looking
statements. Forward-looking statements are subject to risks and
uncertainties, many of which are difficult to predict and generally
beyond our control, that could cause actual results to differ
materially from those expressed, projected or implied in or by the
forward-looking statements. Such risks and uncertainties include:
fluctuations in domestic or foreign vehicle production, the
continued use of outside suppliers, fluctuations in demand for
vehicles containing our products, changes in general economic
conditions, and other risks detailed in our filings with the
Securities and Exchange Commission, including the Risk Factors,
identified in our most recently filed Annual Report on Form 10-K.
We do not undertake any obligation to update any forward-looking
statements.
2015 Net Sales
Growth Guidance Range
|
|
|
|
|
Low
End
|
High
End*
|
Net new
business
|
10.3%
|
11.5%
|
Changes in product
pricing
|
-2.0%
|
-2.0%
|
Base business
growth
|
1.2%
|
2.6%
|
Foreign
currencies
|
-7.5%
|
-6.0%
|
Total
|
2.0%
|
6.0%
|
|
|
|
*Column does not add
due to rounding
|
|
|
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SOURCE BorgWarner Inc.