- BorgWarner Inc (NYSE:BWA) reported a fourth-quarter FY21 sales decline of 6.9% year-on-year, to $3.65 billion, beating the analyst consensus of $3.47 billion.
- Net sales from the Air Management segment declined 9.2% Y/Y, and the e-Propulsion & Drivetrain segment lost 6.6%.
- Gross profit fell 19% to $625 million, and gross margin contracted 260 basis points to 17.1%.
- The operating margin was 4.9%, with an operating income of $178 million.
- Adjusted EPS of $1.06 beat the analyst consensus of $0.75.
- BorgWarner also announced the acquisition of Santroll's light vehicle eMotor business in China for up to ¥1.4 billion. The company plans to fund the transaction primarily with existing cash balances.
- BorgWarner held $1.8 billion in cash and equivalents as of December 31, 2021. Net cash provided by operating activities for the quarter amounted to $542 million with a free cash flow of $370 million.
- BorgWarner also disclosed securing several contracts.
- Outlook: BorgWarner sees FY22 sales of $15.9 billion - $16.5 billion, compared to the consensus of $16.47 billion.
- The company expects an adjusted EPS of $4.15 - $4.60 versus the consensus of $4.65. It sees an operating margin of 8.7% - 9.4%.
- Price Action: BWA shares are trading higher by 1.73% at $43.50 on the last check Tuesday.
