BorgWarner Q4 revenue rises as net income declines slightly
BorgWarner Inc., the turbocharger and emissions systems supplier, reported fourth-quarter gains in revenues and a slight decline in net income.
The company’s net income decreased for the quarter to $139.9 million, or 61 cents per diluted share, compared with $141.4 million, or 62 cents per diluted share, a year earlier.
Excluding one-time items, analysts polled by Thomson Reuters I/B/E/S had expected the company to earn 75 cents per share, which matched the company's performance on that basis.
Revenue was $1.99 billion, an increase from $1.89 billion a year earlier.
Operating income jumped to $212.2 million, up from $187.7 million a year earlier.
BorgWarner’s engine segment grew to $1.4 billion in revenue, up from $1.3 billion a year earlier, but the drivetrain division slipped to $615 million, down from $628 million a year earlier. Without the impact of foreign currencies, net sales were up 2 percent in the segment, the company said in a statement.
Higher sales of dual-clutch transmission modules increased overall sales, but they were partially offset by a planned slow ramp-up of a major program by a North American customer, the statement said.
The company’s April 2014 acquisition of Wahler, an exhaust gas recirculation systems and engine thermostats producer, along with global adoption of BorgWarner’s powertrain technology, drove sales growth for the year, James Verrier, BorgWarner CEO, said in the statement.
“2014 was a remarkably positive year for our company,” Verrier said.
For the full year of 2014, BorgWarner posted revenue of $8.3 billion, up from $7.4 billion a year earlier.
The company’s net income jumped to $655.8 million, or $2.86 per diluted share, up from $624.3 million, or $2.70 per diluted share, a year earlier.
Operating income rose to $963.7 million, up from $855.2 million.
Revenue from the engine segment reached $5.7 billion for the year, up from $5 billion in 2013. Revenue from the drivetrain segment reached $2.6 billion, up from $2.4 billion a year earlier.
Net income from the engine segment was $924 million, up from $826 million in 2013. For drivetrain, BorgWarner reached $303.3 million in net income, up from $252.2 million a year earlier.
“As we look ahead to 2015, we expect our backlog of net new business to drive industry-leading, low double-digit organic net sales growth as demand for our product technologies that improve fuel economy, emissions and performance, continues to accelerate around the globe,” Verrier said in the statement.
The company today also announced its share-repurchase program of $1 billion of the company’s common stock over the next three years.
“This share repurchase program demonstrates confidence in the long-term growth of our business and a continued commitment to create and deliver value to our shareholders,” Verrier said in announcing the program.
BorgWarner ranks No. 32 on the Automotive News list of the top 100 global parts suppliers, with worldwide sales to automakers of $7.44 billion in 2013.
Reuters contributed to this report.