Record Full Year Revenue, Adjusted Operating
Income and Operating Cash Flow
Aptiv PLC (NYSE: APTV), a global technology company focused on
making mobility safer, greener and more connected, today reported
fourth quarter 2023 U.S. GAAP earnings of $3.22 per diluted share.
Excluding special items, fourth quarter earnings totaled $1.40 per
diluted share.
Fourth Quarter Financial Highlights
Include:
- U.S. GAAP revenue of $4.9 billion, an increase of 6%
- Revenue increased 2% adjusted for currency exchange,
commodity movements and acquisitions, compared to AWM1 of
7%
- U.S. GAAP net income of $905 million, diluted earnings per
share of $3.22
- Excluding special items, diluted earnings per share of
$1.40
- U.S. GAAP operating income margin of 7.2%
- Adjusted Operating Income margin of 12.2%; Adjusted
Operating Income of $600 million; Adjusted EBITDA margin of 15.7%;
Adjusted EBITDA of $772 million
- Generated $624 million of cash from operations
- Returned $300 million to shareholders through share
repurchases
- Paid-off $301 million Term Loan over two years
early
Full Year 2023 Financial Highlights
Include:
- U.S. GAAP revenue of $20.1 billion, an increase of 15%
- Revenue increased 12% adjusted for currency exchange,
commodity movements and acquisitions, compared to AWM1 of
10%
- U.S. GAAP net income of $2,909 million, diluted earnings per
share of $10.39
- Excluding special items, diluted earnings per share of
$4.86
- U.S. GAAP operating income margin of 7.8%
- Adjusted Operating Income margin of 10.6%; Adjusted
Operating Income of $2,127 million; Adjusted EBITDA margin of
13.9%; Adjusted EBITDA of $2,788 million
- Generated $1,896 million of cash from operations
- Returned $398 million to shareholders through share
repurchases
“Aptiv delivered record revenue, adjusted operating income and
operating cash flow for the year, reflecting strong growth across
our portfolio and solid operational execution,” said Kevin Clark,
chairman and chief executive officer. “We also achieved our third
year in a row of record new business awards at over $34 billion, a
testament to the quality of our portfolio of advanced technologies.
As our end markets continue to transition towards a feature-rich,
software-defined future, our customers will face increasing
challenges involving product complexity, performance and
affordability. With our flexible, full-system approach, Aptiv
remains uniquely positioned to address these challenges, and we
expect our commercial momentum to continue to accelerate in 2024,
driving further long-term growth and margin expansion.”
1 Represents global vehicle production
weighted to the geographic regions in which the Company generates
its revenue (“AWM”).
Fourth Quarter 2023 Results
For the three months ended December 31, 2023, the Company
reported U.S. GAAP revenue of $4.9 billion, an increase of 6% from
the prior year period. Adjusted for currency exchange, commodity
movements and acquisitions, revenue increased by 2% in the fourth
quarter. This reflects growth of 10% in Asia, which includes 12% in
China, and 6% in Europe, partially offset by declines of 7% in
North America and 6% in South America, our smallest region.
The Company reported fourth quarter 2023 U.S. GAAP net income of
$905 million and earnings of $3.22 per diluted share, compared to
$233 million and $0.86 per diluted share in the prior year period.
Fourth quarter Adjusted Net Income, a non-GAAP financial measure
defined below, totaled $395 million, or $1.40 per diluted share,
compared to $361 million, or $1.27 per diluted share in the prior
year period.
Fourth quarter Adjusted Operating Income, a non-GAAP financial
measure defined below, was $600 million, compared to $523 million
in the prior year period. Adjusted Operating Income margin was
12.2%, compared to 11.3% in the prior year period, reflecting
increased global vehicle production, pricing and the continued
easing of supply chain disruption costs. Depreciation and
amortization expense totaled $246 million, an increase from $188
million in the prior year period.
Interest expense for the fourth quarter totaled $71 million, an
increase from $62 million in the prior year period.
Tax benefit in the fourth quarter of 2023 was $680 million,
which primarily reflects a deferred tax benefit of approximately
$0.7 billion recognized as a result of transactions entered into as
part of a reorganization of the Company’s corporate entity
structure. Tax expense in the fourth quarter of 2022 was $25
million, resulting in an effective tax rate of approximately
7%.
The Company generated net cash flow from operating activities of
$624 million in fourth quarter, compared to $933 million in the
prior year period.
Full Year 2023 Results
For the year ended December 31, 2023, the Company reported U.S.
GAAP revenue of $20.1 billion, an increase of 15% from the prior
year. Adjusted for currency exchange, commodity movements and
acquisitions, revenue increased by 12% in 2023. This reflects
growth of 17% in Europe, 12% in Asia, which includes 12% in China,
9% in North America and 9% in South America, our smallest
region.
For full year 2023, the Company reported U.S. GAAP net income of
$2,909 million and earnings of $10.39 per diluted share, compared
to $531 million and $1.96 per diluted share in the prior year. Full
year 2023 Adjusted Net Income totaled $1,376 million, or $4.86 per
diluted share, compared to $967 million, or $3.41 per diluted
share, in the prior year.
The Company reported Adjusted Operating Income of $2,127 million
for full year 2023, compared to $1,585 million in the prior year.
Adjusted Operating Income margin was 10.6% for full year 2023,
compared to 9.1% in the prior year, reflecting our growth over
market of 2%, increased global vehicle production, pricing and the
results from our recent acquisitions. Depreciation and amortization
expense totaled $912 million, an increase from $762 million in the
prior year.
Interest expense for full year 2023 totaled $285 million, as
compared to $219 million in the prior year, which includes impacts
from our $2.5 billion debt issuance in the first quarter of 2022 in
anticipation of the Wind River Systems, Inc. acquisition and
increased interest rates on our variable rate debt while it was
outstanding during 2023.
Tax benefit for full year 2023 was $1,928 million, which
primarily reflects a deferred tax benefit of approximately $2.1
billion recognized as a result of transactions entered into as part
of a reorganization of the Company’s corporate entity structure.
Tax expense for full year 2022 was $121 million, resulting in an
effective tax rate of approximately 12%.
The Company generated net cash flow from operating activities of
$1,896 million in 2023, compared to $1,263 million in the prior
year. As of December 31, 2023, the Company had cash and cash
equivalents of $1.6 billion and total available liquidity of $4.1
billion.
Reconciliations of Adjusted Revenue Growth, Adjusted Operating
Income, Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income
Per Share and Cash Flow Before Financing, which are non-GAAP
measures, to the most directly comparable financial measures,
respectively, calculated and presented in accordance with
accounting principles generally accepted in the United States
(“GAAP”) are provided in the attached supplemental schedules.
Share Repurchase Program
During the fourth quarter of 2023, the Company repurchased 3.8
million shares for approximately $300 million, leaving
approximately $1.6 billion available for future share repurchases.
For the full year, the Company repurchased 4.7 million shares for
approximately $398 million. All repurchased shares were
retired.
Full Year 2024 Outlook
The Company’s full year 2024 financial guidance is as
follows:
(in millions, except per share
amounts)
Full Year 2024
Net sales
$21,300 - $21,900
Adjusted EBITDA
$3,200 - $3,350
Adjusted EBITDA margin
15.0% - 15.3%
Adjusted operating income
$2,475 - $2,625
Adjusted operating income margin
11.6% - 12.0%
Adjusted net income per share (1)
$5.55 - $6.05
Cash flow from operations
$2,300
Capital expenditures
$1,050
Adjusted effective tax rate
17.5%
(1) The Company’s full year 2024 financial guidance includes
approximately $1.20 per diluted share for the anticipated equity
losses to be recognized by Aptiv from the performance of the
Motional autonomous driving joint venture.
Conference Call and Webcast
The Company will host a conference call to discuss these results
at 8:00 a.m. (ET) today, which is accessible by dialing
+1.800.239.9838 (US) or +1.323.994.2093 (international) or through
a webcast at ir.aptiv.com. The conference ID number is 9145297. A
slide presentation will accompany the prepared remarks and has been
posted on the investor relations section of the Company’s website.
A replay will be available two hours following the conference
call.
Use of Non-GAAP Financial Information
This press release contains information about Aptiv’s financial
results which are not presented in accordance with GAAP.
Specifically, Adjusted Revenue Growth, Adjusted Operating Income,
Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income Per Share
and Cash Flow Before Financing are non-GAAP financial measures.
Adjusted Revenue Growth represents the year-over-year change in
reported net sales relative to the comparable period, excluding the
impact on net sales from currency exchange, commodity movements,
acquisitions, divestitures and other transactions. Adjusted
Operating Income represents net income before interest expense,
other income (expense), net, income tax (expense) benefit, equity
income (loss), net of tax, amortization, restructuring, other
acquisition and portfolio project costs, (which includes costs
incurred to integrate acquired businesses and to plan and execute
product portfolio transformation actions, including business and
product acquisitions and divestitures), asset impairments and other
related charges, compensation expense related to acquisitions and
gains (losses) on business divestitures and other transactions.
Adjusted Operating Income margin is defined as Adjusted Operating
Income as a percentage of net sales. Adjusted EBITDA represents net
income before depreciation and amortization (including asset
impairments), interest expense, income tax (expense) benefit, other
income (expense), net, equity income (loss), net of tax,
restructuring and other special items.
Adjusted Net Income represents net income attributable to Aptiv
before amortization, restructuring and other special items,
including the tax impact thereon. Adjusted Net Income Per Share
represents Adjusted Net Income divided by the Adjusted Weighted
Average Number of Diluted Shares Outstanding for the period. The
Adjusted Weighted Average Number of Diluted Shares Outstanding
assumes the application of the if-converted method of share
dilution, if not already applied for GAAP purposes of calculating
the weighted average number of diluted shares outstanding. Cash
Flow Before Financing represents cash provided by (used in)
operating activities plus cash provided by (used in) investing
activities, adjusted for the purchase price of business
acquisitions and other transactions, the cost of significant
technology investments and net proceeds from the divestiture of
discontinued operations and other significant businesses.
Management believes the non-GAAP financial measures used in this
press release are useful to both management and investors in their
analysis of the Company’s financial position, results of operations
and liquidity. In particular, management believes Adjusted Revenue
Growth, Adjusted Operating Income, Adjusted EBITDA, Adjusted Net
Income, Adjusted Net Income Per Share and Cash Flow Before
Financing are useful measures in assessing the Company’s ongoing
financial performance that, when reconciled to the corresponding
GAAP measure, provide improved comparability between periods
through the exclusion of certain items that management believes are
not indicative of the Company’s core operating performance and that
may obscure underlying business results and trends. Management also
uses these non-GAAP financial measures for internal planning and
forecasting purposes.
Such non-GAAP financial measures are reconciled to the most
directly comparable GAAP financial measures in the attached
supplemental schedules at the end of this press release. Non-GAAP
measures should not be considered in isolation or as a substitute
for our reported results prepared in accordance with GAAP and, as
calculated, may not be comparable to other similarly titled
measures of other companies.
About Aptiv
Aptiv is a global technology company that develops safer,
greener and more connected solutions enabling a more sustainable
future of mobility. Visit aptiv.com.
Forward-Looking Statements
This press release, as well as other statements made by Aptiv
PLC (the “Company”), contain forward-looking statements that
reflect, when made, the Company’s current views with respect to
current events, certain investments and acquisitions and financial
performance. Such forward-looking statements are subject to many
risks, uncertainties and factors relating to the Company’s
operations and business environment, which may cause the actual
results of the Company to be materially different from any future
results. All statements that address future operating, financial or
business performance or the Company’s strategies or expectations
are forward-looking statements. Factors that could cause actual
results to differ materially from these forward-looking statements
are discussed under the captions “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” in the Company’s filings with the Securities and
Exchange Commission. New risks and uncertainties arise from time to
time, and it is impossible for us to predict these events or how
they may affect the Company. It should be remembered that the price
of the ordinary shares and any income from them can go down as well
as up. The Company disclaims any intention or obligation to update
or revise any forward-looking statements, whether as a result of
new information, future events and/or otherwise, except as may be
required by law.
APTIV PLC
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited)
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
(in millions, except per share
amounts)
Net sales
$
4,919
$
4,640
$
20,051
$
17,489
Operating expenses:
Cost of sales
3,997
3,827
16,612
14,854
Selling, general and administrative
381
303
1,436
1,138
Amortization
56
37
233
149
Restructuring
130
33
211
85
Total operating expenses
4,564
4,200
18,492
16,226
Operating income
355
440
1,559
1,263
Interest expense
(71
)
(62
)
(285
)
(219
)
Other income (expense), net
27
(10
)
63
(54
)
Income before income taxes and equity
loss
311
368
1,337
990
Income tax benefit (expense)
680
(25
)
1,928
(121
)
Income before equity loss
991
343
3,265
869
Equity loss, net of tax
(72
)
(77
)
(299
)
(279
)
Net income
919
266
2,966
590
Net income (loss) attributable to
noncontrolling interest
13
18
28
(3
)
Net income (loss) attributable to
redeemable noncontrolling interest
1
(1
)
—
(1
)
Net income attributable to Aptiv
905
249
2,938
594
Mandatory convertible preferred share
dividends
—
(16
)
(29
)
(63
)
Net income attributable to ordinary
shareholders
$
905
$
233
$
2,909
$
531
Diluted net income per share:
Diluted net income per share attributable
to ordinary shareholders
$
3.22
$
0.86
$
10.39
$
1.96
Weighted average number of diluted shares
outstanding
281.21
271.40
282.88
271.18
APTIV PLC
CONSOLIDATED BALANCE
SHEETS
(Unaudited)
December 31,
2023
December 31,
2022
(in millions)
ASSETS
Current assets:
Cash and cash equivalents
$
1,640
$
1,531
Accounts receivable, net
3,546
3,433
Inventories
2,365
2,340
Other current assets
696
480
Total current assets
8,247
7,784
Long-term assets:
Property, net
3,785
3,495
Operating lease right-of-use assets
540
451
Investments in affiliates
1,443
1,723
Intangible assets, net
2,399
2,585
Goodwill
5,151
5,106
Other long-term assets
2,862
740
Total long-term assets
16,180
14,100
Total assets
$
24,427
$
21,884
LIABILITIES, REDEEMABLE NONCONTROLLING
INTEREST AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt
$
9
$
31
Accounts payable
3,151
3,150
Accrued liabilities
1,648
1,684
Total current liabilities
4,808
4,865
Long-term liabilities:
Long-term debt
6,204
6,460
Pension benefit obligations
417
354
Long-term operating lease liabilities
453
361
Other long-term liabilities
701
750
Total long-term liabilities
7,775
7,925
Total liabilities
12,583
12,790
Commitments and contingencies
Redeemable noncontrolling interest
99
96
Total Aptiv shareholders’ equity
11,548
8,809
Noncontrolling interest
197
189
Total shareholders’ equity
11,745
8,998
Total liabilities, redeemable
noncontrolling interest and shareholders’ equity
$
24,427
$
21,884
APTIV PLC
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
Year Ended December
31,
2023
2022
(in millions)
Cash flows from operating activities:
Net income
$
2,966
$
590
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
912
762
Restructuring expense, net of cash
paid
83
18
Deferred income taxes
(2,164
)
(144
)
Loss from equity method investments, net
of dividends received
304
284
Other charges related to Ukraine/Russia
conflict
—
54
Other, net
171
126
Changes in operating assets and
liabilities:
Accounts receivable, net
(112
)
(497
)
Inventories
(20
)
(258
)
Accounts payable
4
137
Other, net
(215
)
215
Pension contributions
(33
)
(24
)
Net cash provided by operating
activities
1,896
1,263
Cash flows from investing activities:
Capital expenditures
(906
)
(844
)
Proceeds from sale of property
4
4
Proceeds from business divestitures, net
of cash sold
(17
)
—
Cost of business acquisitions and other
transactions, net of cash acquired
(83
)
(4,310
)
Proceeds from sale of technology
investments
—
3
Cost of technology investments
(6
)
(42
)
Settlement of derivatives
6
7
Net cash used in investing activities
(1,002
)
(5,182
)
Cash flows from financing activities:
Decrease in other short and long-term
debt, net
(332
)
(5
)
Proceeds from issuance of senior notes,
net of issuance costs
—
2,472
Contingent consideration payments
(10
)
—
Dividend payments of consolidated
affiliates to minority shareholders
(2
)
(9
)
Repurchase of ordinary shares
(398
)
—
Distribution of mandatory convertible
preferred share cash dividends
(32
)
(63
)
Taxes withheld and paid on employees’
restricted share awards
(33
)
(36
)
Net cash (used in) provided by financing
activities
(807
)
2,359
Effect of exchange rate fluctuations on
cash, cash equivalents and restricted cash
(2
)
(24
)
Increase (decrease) in cash, cash
equivalents and restricted cash
85
(1,584
)
Cash, cash equivalents and restricted cash
at beginning of the year
1,555
3,139
Cash, cash equivalents and restricted cash
at end of the year
$
1,640
$
1,555
Reconciliation of cash, cash
equivalents and restricted cash and cash classified as assets held
for sale:
December 31,
2023
2022
(in millions)
Cash, cash equivalents and restricted
cash
$
1,640
$
1,531
Cash classified as assets held for
sale
—
24
Total cash, cash equivalents and
restricted cash
$
1,640
$
1,555
APTIV PLC
FOOTNOTES
(Unaudited)
1. Segment Summary
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
%
2023
2022
%
(in millions)
(in millions)
Net Sales
Signal and Power Solutions
$
3,574
$
3,374
6
%
$
14,404
$
12,943
11
%
Advanced Safety and User Experience
1,356
1,280
6
%
5,695
4,587
24
%
Eliminations and Other (a)
(11
)
(14
)
(48
)
(41
)
Net Sales
$
4,919
$
4,640
$
20,051
$
17,489
Adjusted Operating
Income
Signal and Power Solutions
$
459
$
446
3
%
$
1,676
$
1,441
16
%
Advanced Safety and User Experience
141
77
83
%
451
144
213
%
Adjusted Operating Income
$
600
$
523
$
2,127
$
1,585
(a)
Eliminations and Other includes the
elimination of inter-segment transactions.
2. Weighted Average Number of Diluted Shares Outstanding
The following table illustrates the
weighted average shares outstanding used in calculating basic and
diluted net income per share attributable to ordinary shareholders
for the three months and years ended December 31, 2023 and
2022:
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
(in millions, except per share
data)
Weighted average ordinary shares
outstanding, basic
280.95
270.95
276.92
270.90
Dilutive shares related to RSUs
0.26
0.45
0.17
0.28
Weighted average MCPS Converted Shares
—
—
5.79
—
Weighted average ordinary shares
outstanding, including dilutive shares
281.21
271.40
282.88
271.18
Net income per share attributable to
ordinary shareholders:
Basic
$
3.22
$
0.86
$
10.50
$
1.96
Diluted
$
3.22
$
0.86
$
10.39
$
1.96
APTIV PLC RECONCILIATION OF NON-GAAP
MEASURES (Unaudited)
In this press release the Company has provided information
regarding certain non-GAAP financial measures, including “Adjusted
Revenue Growth,” “Adjusted Operating Income,” “Adjusted EBITDA,”
“Adjusted Net Income,” “Adjusted Net Income Per Share” and “Cash
Flow Before Financing.” Such non-GAAP financial measures are
reconciled to their closest GAAP financial measure in the following
schedules.
Adjusted Revenue Growth:
Adjusted Revenue Growth is presented as a supplemental measure of
the Company’s financial performance which management believes is
useful to investors in assessing the Company’s ongoing financial
performance that, when reconciled to the corresponding U.S. GAAP
measure, provides improved comparability between periods through
the exclusion of certain items that management believes are not
indicative of the Company’s core operating performance and which
may obscure underlying business results and trends. Our management
utilizes Adjusted Revenue Growth in its financial decision making
process, to evaluate performance of the Company and for internal
reporting, planning and forecasting purposes. Adjusted Revenue
Growth is defined as the year-over-year change in reported net
sales relative to the comparable period, excluding the impact on
net sales from currency exchange, commodity movements,
acquisitions, divestitures and other transactions. Not all
companies use identical calculations of Adjusted Revenue Growth,
therefore this presentation may not be comparable to other
similarly titled measures of other companies.
Three Months Ended December
31, 2023
Reported net sales % change
6
%
Less: foreign currency exchange and
commodities
1
%
Less: acquisitions
3
%
Adjusted revenue growth
2
%
Year Ended December 31,
2023
Reported net sales % change
15
%
Less: foreign currency exchange and
commodities
(1
)%
Less: acquisitions
4
%
Adjusted revenue growth
12
%
Adjusted Operating Income:
Adjusted Operating Income is presented as a supplemental measure of
the Company’s financial performance which management believes is
useful to investors in assessing the Company’s ongoing financial
performance that, when reconciled to the corresponding U.S. GAAP
measure, provides improved comparability between periods through
the exclusion of certain items that management believes are not
indicative of the Company’s core operating performance and which
may obscure underlying business results and trends. Our management
utilizes Adjusted Operating Income in its financial decision making
process, to evaluate performance of the Company and for internal
reporting, planning and forecasting purposes. Management also
utilizes Adjusted Operating Income as the key performance measure
of segment income or loss and for planning and forecasting purposes
to allocate resources to our segments, as management also believes
this measure is most reflective of the operational profitability or
loss of our operating segments. Adjusted Operating Income is
defined as net income before interest expense, other income
(expense), net, income tax (expense) benefit, equity income (loss),
net of tax, amortization, restructuring and other special items.
Not all companies use identical calculations of Adjusted Operating
Income, therefore this presentation may not be comparable to other
similarly titled measures of other companies. Operating income
margin represents Operating income as a percentage of net sales,
and Adjusted Operating Income margin represents Adjusted Operating
Income as a percentage of net sales.
Consolidated Adjusted Operating
Income
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
($ in millions)
$
Margin
$
Margin
$
Margin
$
Margin
Net income attributable to Aptiv
$
905
$
249
$
2,938
$
594
Interest expense
71
62
285
219
Other (income) expense, net
(27
)
10
(63
)
54
Income tax (benefit) expense
(680
)
25
(1,928
)
121
Equity loss, net of tax
72
77
299
279
Net income (loss) attributable to
noncontrolling interest
13
18
28
(3
)
Net income (loss) attributable to
redeemable noncontrolling interest
1
(1
)
—
(1
)
Operating income
355
7.2
%
440
9.5
%
1,559
7.8
%
1,263
7.2
%
Amortization
56
37
233
149
Restructuring
130
33
211
85
Other acquisition and portfolio project
costs
35
13
80
26
Asset impairments
18
—
18
8
Other charges related to Ukraine/Russia
conflict
—
—
—
54
Compensation expense related to
acquisitions
6
—
26
—
Adjusted operating income
$
600
12.2
%
$
523
11.3
%
$
2,127
10.6
%
$
1,585
9.1
%
Segment Adjusted Operating
Income
(in millions)
Three Months Ended December 31,
2023
Signal and Power
Solutions
Advanced Safety and User
Experience
Total
Operating income
$
325
$
30
$
355
Amortization
33
23
56
Restructuring
60
70
130
Other acquisition and portfolio project
costs
26
9
35
Asset impairments
15
3
18
Compensation expense related to
acquisitions
—
6
6
Adjusted operating income
$
459
$
141
$
600
Depreciation and amortization (a)
$
174
$
72
$
246
Three Months Ended December 31,
2022
Signal and Power
Solutions
Advanced Safety and User
Experience
Total
Operating income
$
399
$
41
$
440
Amortization
32
5
37
Restructuring
7
26
33
Other acquisition and portfolio project
costs
8
5
13
Adjusted operating income
$
446
$
77
$
523
Depreciation and amortization (a)
$
143
$
45
$
188
Year Ended December 31, 2023
Signal and Power
Solutions
Advanced Safety and User
Experience
Total
Operating income
$
1,379
$
180
$
1,559
Amortization
140
93
233
Restructuring
82
129
211
Other acquisition and portfolio project
costs
60
20
80
Asset impairments
15
3
18
Compensation expense related to
acquisitions
—
26
26
Adjusted operating income
$
1,676
$
451
$
2,127
Depreciation and amortization (a)
$
638
$
274
$
912
Year Ended December 31, 2022
Signal and Power
Solutions
Advanced Safety and User
Experience
Total
Operating income
$
1,195
$
68
$
1,263
Amortization
139
10
149
Restructuring
30
55
85
Other acquisition and portfolio project
costs
15
11
26
Asset impairments
8
—
8
Other charges related to Ukraine/Russia
conflict
54
—
54
Adjusted operating income
$
1,441
$
144
$
1,585
Depreciation and amortization (a)
$
584
$
178
$
762
(a)
Includes asset impairments.
Adjusted EBITDA: Adjusted
EBITDA is presented as a supplemental measure of the Company’s
financial performance which management believes is useful to
investors in assessing the Company’s ongoing financial performance
that, when reconciled to the corresponding U.S. GAAP measure,
provides improved comparability between periods through the
exclusion of certain items that management believes are not
indicative of the Company’s core operating performance and which
may obscure underlying business results and trends. Our management
utilizes Adjusted EBITDA in its financial decision making process,
to evaluate performance of the Company and for internal reporting,
planning and forecasting purposes. Adjusted EBITDA is defined as
net income before depreciation and amortization (including asset
impairments), interest expense, income tax (expense) benefit, other
income (expense), net, equity income (loss), net of tax,
restructuring and other special items. Not all companies use
identical calculations of Adjusted EBITDA, therefore this
presentation may not be comparable to other similarly titled
measures of other companies.
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
(in millions)
Net income attributable to Aptiv
$
905
$
249
$
2,938
$
594
Interest expense
71
62
285
219
Income tax (benefit) expense
(680
)
25
(1,928
)
121
Net income (loss) attributable to
noncontrolling interest
13
18
28
(3
)
Net income (loss) attributable to
redeemable noncontrolling interest
1
(1
)
—
(1
)
Depreciation and amortization
246
188
912
762
EBITDA
$
556
$
541
$
2,235
$
1,692
Other (income) expense, net
(27
)
10
(63
)
54
Equity loss, net of tax
72
77
299
279
Restructuring
130
33
211
85
Other acquisition and portfolio project
costs
35
13
80
26
Other charges related to Ukraine/Russia
conflict
—
—
—
54
Compensation expense related to
acquisitions
6
—
26
—
Adjusted EBITDA
$
772
$
674
$
2,788
$
2,190
Adjusted Net Income and Adjusted Net
Income Per Share: Adjusted Net Income and Adjusted Net
Income Per Share, which are non-GAAP measures, are presented as
supplemental measures of the Company’s financial performance which
management believes are useful to investors in assessing the
Company’s ongoing financial performance that, when reconciled to
the corresponding U.S. GAAP measure, provide improved comparability
between periods through the exclusion of certain items that
management believes are not indicative of the Company’s core
operating performance and which may obscure underlying business
results and trends. Management utilizes Adjusted Net Income and
Adjusted Net Income Per Share in its financial decision making
process, to evaluate performance of the Company and for internal
reporting, planning and forecasting purposes. Adjusted Net Income
is defined as net income attributable to Aptiv before amortization,
restructuring and other special items, including the tax impact
thereon. Adjusted Net Income Per Share is defined as Adjusted Net
Income divided by the Adjusted Weighted Average Number of Diluted
Shares Outstanding, as reconciled below, for the period. Not all
companies use identical calculations of Adjusted Net Income and
Adjusted Net Income Per Share, therefore this presentation may not
be comparable to other similarly titled measures of other
companies.
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
(in millions, except per share
amounts)
Net income attributable to ordinary
shareholders
$
905
$
233
$
2,909
$
531
Mandatory convertible preferred share
dividends
—
16
29
63
Net income attributable to Aptiv
905
249
2,938
594
Adjusting items:
Amortization
56
37
233
149
Restructuring
130
33
211
85
Other acquisition and portfolio project
costs
35
13
80
26
Asset impairments
18
—
18
8
Other charges related to Ukraine/Russia
conflict (a)
—
—
—
29
Compensation expense related to
acquisitions
6
—
26
—
Costs associated with acquisitions and
other transactions
—
53
4
61
Debt extinguishment costs
1
—
1
—
Impairment of equity investments without
readily determinable fair value
—
—
18
—
(Gain) loss on change in fair value of
publicly traded equity securities
—
(3
)
6
52
Tax impact of intra-entity transfers of
intellectual property and other related transactions (b)
(723
)
—
(2,082
)
—
Tax impact of adjusting items (c)
(33
)
(21
)
(77
)
(37
)
Adjusted net income attributable to
Aptiv
$
395
$
361
$
1,376
$
967
Adjusted weighted average number of
diluted shares outstanding (d)
281.21
283.77
282.88
283.55
Diluted net income per share attributable
to ordinary shareholders
$
3.22
$
0.86
$
10.39
$
1.96
Adjusted net income per share
$
1.40
$
1.27
$
4.86
$
3.41
(a)
Adjustment is reduced by the portion of
charges attributable to noncontrolling interest for our former
majority owned Russian subsidiary. Our interest in this subsidiary
was sold during the second quarter of 2023 and the subsidiary was
deconsolidated.
(b)
In response to the OECD’s Pillar Two
Directive, the Company initiated changes to its corporate entity
structure, including intra-entity transfers of certain intellectual
property to one of its subsidiaries in Switzerland during the
second half of 2023. Furthermore, during the third quarter, the
Company’s Swiss subsidiary was granted a ten-year tax incentive,
beginning in 2024. The measurement of certain deferred tax assets
and associated income tax benefits resulting from these
transactions was impacted by tax legislation in Switzerland enacted
in the fourth quarter of 2023, which increased the statutory income
tax rate, resulting in additional deferred tax benefit impacts, net
of valuation allowances. These adjustments represent the total
income tax benefits recorded as a result of these transactions
during the three months and year ended December 31, 2023.
(c)
Represents the income tax impacts of the
adjustments made for amortization, restructuring and other special
items by calculating the income tax impact of these items using the
appropriate tax rate for the jurisdiction where the charges were
incurred.
(d)
In June 2020, the Company issued $1,150
million in aggregate liquidation preference of 5.50% Mandatory
Convertible Preferred Shares (the “MCPS”) and received proceeds of
$1,115 million, after deducting expenses and the underwriters’
discount of $35 million. Each share of MCPS automatically converted
on June 15, 2023 into 1.0754 Aptiv ordinary shares. Dividends on
the MCPS were payable on a cumulative basis at an annual rate of
5.50% on the liquidation preference of $100 per share. For purposes
of calculating Adjusted Net Income Per Share, the Company has
excluded the MCPS cash dividends and assumed the “if-converted”
method of share dilution (the incremental ordinary shares deemed
outstanding applying the “if-converted” method of calculating share
dilution are referred to as the “Weighted average MCPS Converted
Shares” in the following table). The Adjusted Weighted Average
Number of Diluted Shares Outstanding calculated below, assumes the
conversion of all 11.5 million MCPS at the later of the beginning
of the period or the time of issuance, and resulting issuance of
the underlying ordinary shares applying the “if-converted” method
(method already applied for U.S. GAAP purposes of calculating the
weighted average number of diluted shares outstanding for the year
ended December 31, 2023) on a weighted average outstanding basis
for all periods subsequent to issuance of the MCPS. We believe that
using the “if-converted” method provides additional insight to
investors on the impact of the MCPS upon their conversion.
Adjusted Weighted
Average Number of Diluted Shares Outstanding:
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
(in millions)
Weighted average number of diluted shares
outstanding
281.21
271.40
282.88
271.18
Weighted average MCPS Converted Shares
—
12.37
—
12.37
Adjusted weighted average number of
diluted shares outstanding
281.21
283.77
282.88
283.55
Cash Flow Before Financing:
Cash Flow Before Financing is presented as a supplemental measure
of the Company’s liquidity which is consistent with the basis and
manner in which management presents financial information for the
purpose of making internal operating decisions, evaluating its
liquidity and determining appropriate capital allocation
strategies. Management believes this measure is useful to investors
to understand how the Company’s core operating activities generate
and use cash. Cash Flow Before Financing is defined as cash
provided by (used in) operating activities plus cash provided by
(used in) investing activities, adjusted for the purchase price of
business acquisitions and other transactions, the cost of
significant technology investments and net proceeds from the
divestiture of discontinued operations and other significant
businesses. Not all companies use identical calculations of Cash
Flow Before Financing, therefore this presentation may not be
comparable to other similarly titled measures of other companies.
The calculation of Cash Flow Before Financing does not reflect cash
used to service debt, pay dividends or repurchase shares and,
therefore, does not necessarily reflect funds available for
investment or other discretionary uses.
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
(in millions)
Cash flows from operating activities:
Net income
$
919
$
266
$
2,966
$
590
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
246
188
912
762
Restructuring expense, net of cash
paid
79
16
83
18
Working capital
173
372
(128
)
(618
)
Pension contributions
(13
)
(9
)
(33
)
(24
)
Increase in deferred income tax assets
from intra-entity transfers of intellectual property and other
related transactions
(723
)
—
(2,082
)
—
Other, net
(57
)
100
178
535
Net cash provided by operating
activities
624
933
1,896
1,263
Cash flows from investing activities:
Capital expenditures
(203
)
(178
)
(906
)
(844
)
Proceeds from business divestitures, net
of cash sold
—
—
(17
)
—
Cost of business acquisitions and other
transactions, net of cash acquired
—
(4,090
)
(83
)
(4,310
)
Proceeds from sale of technology
investments
—
—
—
3
Cost of technology investments
(5
)
—
(6
)
(42
)
Settlement of derivatives
—
(2
)
6
7
Other, net
1
1
4
4
Net cash used in investing activities
(207
)
(4,269
)
(1,002
)
(5,182
)
Adjusting items:
Adjustment for the cost of business
acquisitions and other transactions, net
—
4,090
83
4,310
Adjustment for cost of significant
technology investments
4
—
4
40
Cash flow before financing
$
421
$
754
$
981
$
431
Financial Guidance: The
reconciliation of the forward-looking non-GAAP financial measures
provided in the Company’s financial guidance to the most comparable
forward-looking GAAP measure is as follows:
Estimated Full Year
2024 (a)
($ in millions)
Adjusted
Operating Income
$
Margin (b)
Net income attributable to Aptiv
$
1,235
Interest expense
250
Other income, net
(75
)
Income tax expense
340
Equity loss, net of tax
330
Net income attributable to noncontrolling
interest (c)
25
Operating income
2,105
9.7
%
Amortization
225
Restructuring
150
Other acquisition and portfolio project
costs
40
Compensation expense related to
acquisitions
30
Adjusted operating income
$
2,550
11.8
%
Adjusted
EBITDA
Net income attributable to Aptiv
$
1,235
Interest expense
250
Income tax expense
340
Net income attributable to noncontrolling
interest (c)
25
Depreciation and amortization
950
EBITDA
$
2,800
13.0
%
Other income, net
(75
)
Equity loss, net of tax
330
Restructuring
150
Other acquisition and portfolio project
costs
40
Compensation expense related to
acquisitions
30
Adjusted EBITDA
$
3,275
15.2
%
(a)
Prepared at the estimated mid-point of the
Company’s financial guidance range.
(b)
Represents operating income, Adjusted
Operating Income, EBITDA and Adjusted EBITDA, respectively, as a
percentage of estimated net sales.
(c)
Includes portion attributable to
redeemable noncontrolling interest.
Estimated Full Year
2024 (a)
Adjusted Net
Income Per Share
($ and shares in millions,
except per share amounts)
Net income attributable to Aptiv
$
1,235
Adjusting items:
Amortization
225
Restructuring
150
Other acquisition and portfolio project
costs
40
Compensation expense related to
acquisitions
30
Tax impact of adjusting items
(75
)
Adjusted net income attributable to
Aptiv
$
1,605
Adjusted weighted average number of
diluted shares outstanding
277.00
Diluted net income per share attributable
to ordinary shareholders
$
4.45
Adjusted net income per share
$
5.80
(a)
Prepared at the estimated mid-point of the
Company’s financial guidance range.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240131735343/en/
Jane Wu +1.617.603.7941 jane.wu@aptiv.com
Aptiv (NYSE:APTV)
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