Autoliv: Financial Report April - June 2014
STOCKHOLM-- July 18, 2014: In the second quarter we saw solid growth across our markets, notably North America, Europe and Japan. The exception was Brazil where we saw a sharp decline in light vehicle production. In addition, our main growth engines over the last two years, China and active safety, continued their strong performance.”
Autoliv AB (STO:ALIVSDB)
Solid growth across our markets
For the three-month period ended June 30, 2014, Autoliv, Inc. – the worldwide leader in automotive safety systems – reported consolidated sales of $2,383 million, the highest quarterly sales for the Company ever. Quarterly organic sales (for non-U.S. GAAP measures* see enclosed reconciliation table) grew by more than 7%. The adjusted operating margin* was 9.3%.
The expectation at the beginning of the quarter was for an organic sales growth of “around 5%” and an adjusted operating margin of “around 9%”. During the quarter the Company recorded legal costs related to the settlements of class action lawsuits in the U.S. of around $70 million. Additionally the Company returned a total of $146 million to our shareholders through share buybacks and dividends. The Company also secured $1.25 billion in long term funding at an average interest rate of 3.84% by the closing of its U.S. private placement.
For the third quarter of 2014 we expect organic sales to increase by around 6%, and an adjusted operating margin of around 8.5%. The indication for the full year is now for organic sales growth of more than 6%, and an adjusted operating margin of around 9%.
For Key Figures summary table, please refer to attached file below.
Comments from Jan Carlson, Chairman, President & CEO
“In the second quarter we saw solid growth across our markets, notably North America, Europe and Japan. The exception was Brazil where we saw a sharp decline in light vehicle production. In addition, our main growth engines over the last two years, China and active safety, continued their strong performance.
Coming from low production levels, Europe saw its sixth consecutive quarter of growth with European car sales growing by 7% in the first half of 2014. At the moment we see a slow but sustained recovery in Europe. This supports the operational improvement program in our European steering wheel business which is developing in line with the original plan outlined last year.
The growth in Japan was a positive surprise. At the beginning of the quarter a decline of the light vehicle production was expected as a result of an increase in the Japanese consumption tax. Instead, we saw slight growth and a favorable product mix for Autoliv which led to double digit growth. A sustained recovery in the Japanese economy could also reflect positively on the light vehicle production moving forward.
Active safety showed solid growth in the quarter and in order to support the continued growth and development in this business we have decided to increase the development and engineering spending. In the current situation with millions of cars being recalled for safety related reasons the importance of quality cannot be overemphasized. In this environment we continue to further build our position as the industry’s quality leader, as our business is all about saving lives.
With these issues in mind we continue the focus on our growth strategy, quality, and execution of the 2014 transition. ”