Autoliv: Financial Report July - September 2024
In This Article:
STOCKHOLM, Oct. 18, 2024 /PRNewswire/ -- (NYSE: ALV) (SSE: ALIV.sdb)
Q3 2024: Solid sales outperformance
Financial highlights Q3 2024
$2,555 million net sales
1.6% net sales decrease
0.8% organic sales decline*
8.9% operating margin
9.3% adjusted operating margin*
$1.74 diluted EPS, 11% increase
$1.84 adjusted diluted EPS*, 11% increase
Full year 2024 guidance
Around 1% organic sales growth
Around 1% negative FX effect on net sales
Around 9.5-10.0% adjusted operating margin
Around $1.1 billion operating cash flow
All change figures in this release compare to the same period of the previous year except when stated otherwise.
Key business developments in the third quarter of 2024
-
Third quarter sales decreased organically* by 0.8%, which was 4pp better than global LVP decline of 4.8% (S&P Global Oct 2024). We outperformed in Europe and Asia excl. China, mainly due to high level of product launches and positive pricing. Our sales to domestic Chinese OEMs grew by 18%, which is twice as much as their LVP growth of 8.5%. Despite this, we underperformed in China, due to a substantial negative LVP mix as lower safety content models grew strongly while higher content models declined.
-
Profitability was unchanged despite a slight net sales decline. This was mainly due to successful execution of cost reductions and commercial recoveries and despite inflationary cost increases and a $14 million cost related to a supplier settlement. Both direct and indirect headcount continued to decrease. Operating income was $226 million and operating margin was 8.9%. Adjusted operating income* was $237 million and adjusted operating margin* was 9.3%. Return on capital employed was 22.9% and adjusted return on capital employed* was 23.9%.
-
Operating cash flow was $177 million, as expected, and we are on track towards $1.1 billion for 2024. Free cash flow* was $32 million compared to $50 million last year. At 1.4x, the leverage ratio* remained within our target range. In the quarter, a dividend of $0.68 per share was paid, and 1.33 million shares were repurchased and retired.
*For non-U.S. GAAP measures see enclosed reconciliation tables.
Key Figures
| (Dollars in millions, except per share data) | Q3 2024 | Q3 2023 | Change | 9M 2024 | 9M 2023 | Change |
| Net sales | $2,555 | $2,596 | (1.6) % | $7,774 | $7,724 | 0.7 % |
| Operating income | 226 | 232 | (2.4) % | 626 | 453 | 38 % |
| Adjusted operating income1) | 237 | 243 | (2.3) % | 657 | 586 | 12 % |
| Operating margin | 8.9 % | 8.9 % | (0.1)pp | 8.1 % | 5.9 % | 2.2pp |
| Adjusted operating margin1) | 9.3 % | 9.4 % | (0.1)pp | 8.5 % | 7.6 % | 0.9pp |
| Earnings per share - diluted | 1.74 | 1.57 | 11 % | 4.98 | 3.04 | 64 % |
| Adjusted earnings per share - diluted1) | 1.84 | 1.66 | 11 % | 5.30 | 4.48 | 18 % |
| Operating cash flow | 177 | 202 | (12) % | 639 | 535 | 19 % |
| Return on capital employed2) | 22.9 % | 24.2 % | (1.3)pp | 21.2 % | 15.6 % | 5.6pp |
| Adjusted return on capital employed1,2) | 23.9 % | 24.5 % | (0.7)pp | 22.1 % | 19.8 % | 2.3pp |
| 1) Excluding effects from capacity alignments, antitrust related matters and for FY 2023 the Andrews litigation settlement. Non-U.S. GAAP measure, see reconciliation table. | ||||||
Comments from Mikael Bratt, President & CEO
Light vehicle production was weak in the third quarter, declining by close to 5% globally. This was driven by a combination of inventory reductions, especially in the Americas and a high comparison base, especially in China. In this tough environment, Autoliv managed to outgrow LVP by 4pp, enabling almost unchanged sales and operating income. This is despite a $14 million cost item related to a supplier settlement.
