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Autoliv (ALV) Misses Q4 Earnings and Revenues Estimates
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Autoliv, Inc. (ALV - Free Report) reported adjusted earnings of $1.71 per share in the fourth quarter of 2016 that missed the Zacks Consensus Estimate of $1.83. Also, earnings decreased 17.8% from $2.08 per share reported a year ago. Earnings per share, on a reported basis, amounted to $1.67 in fourth quarter of 2016 compared with $2.10 in the year-ago quarter.
Autoliv reported record consolidated quarter revenues of $2.6 billion, up 3.3% year over year, but missed the Zacks Consensus Estimate of $2.69 billion. Excluding negative currency translation effects and the impact of acquisitions, organic sales improved 1.1%, exceeding the company’s expectation of flat organic sales.
Operating income decreased 15.1% to $238.7 million (or 9.2% of sales) from $281.3 million (or 11.2% of sales) in the year-ago quarter. Adjusted operating margin was 9.3% in the reported quarter, in line with the company’s expectation of above 9%.
Shares of the company fell around 8.2% to close at $106.80 on Feb 2 on the company’s weaker than expected top and bottom line.
Autoliv reported record consolidated revenues of $10.1 billion in 2016, up 9.8% from 2015. However, revenues narrowly missed the Zacks Consensus Estimate of $10.2 billion. Excluding negative currency translation effects of 2% and the impact of acquisitions of close to 5%, organic sales improved more than 7%.
Adjusted earnings per share improved 1.5% from 2015 to $6.75 in 2016, but also missed the Zacks Consensus Estimate of $6.84. Earnings were boosted by lower costs, partially offset by currency headwinds.
Segment Results
Sales at the Passive Safety segment fell 1.6% year over year to $2.04 billion in the reported quarter. Excluding negative currency translation effects, organic sales increased almost 1%. The segment’s operating income fell 13.6% to $228.5 million (11.2% of sales) from $264.5 million (12.8% of sales) in the prior-year quarter. Operating margins were weakened by higher expenditure on research and development as well as other costs to support growth.
Sales at the Electronics segment grew 26.1% year over year to $584.1 million. Organic sales were up 3.4%. The Autoliv-Nissin Brake Systems (ANBS) joint venture impacted sales positively. Operating income from the division fell 7.7% to $29.8 million (5.1% of sales) from $32.3 million (7% of sales) in the prior-year quarter. Margins were negatively affected due to costs related to the formation of ANBS and long-term development plans.
Financial Position
Autoliv had cash and cash equivalents of $1.23 billion as of Dec 31, 2016, lower than the $1.33 billion reported as of Dec 31, 2015. Total debt was almost in line year over year at $1.54 billion as of Dec 31, 2016.
In full year 2016, the company’s cash flow from operations increased to $868.4 million from the year-ago figure of $750.5 million. Net capital expenditures rose to $499 million from the year-ago recorded figure of $450 million.
Dividend
On Nov 3, 2016, Autoliv declared a quarterly dividend of 58 cents per share for the first quarter of 2017. The dividend will be paid on Mar 2, to shareholders on record as of Feb 15, 2017.
Guidance
Autoliv expects organic sales to grow by 3% year over year in the first quarter of 2017. Recent acquisitions and currency translations are expected to have a positive impact of about 2% on sales. This impact is likely to result in consolidated sales growth of over 5%. The adjusted operating margin in the first quarter is expected to be around 8%.
Autoliv expects full-year 2017 organic sales to increase around 4%. The recent acquisitions and currency translation are expected have a 2% adverse impact on sales. Based on these factors, consolidated sales are expected to rise around 2%. Adjusted operating margin, excluding costs for capacity alignments and antitrust related matters, is likely to be 8.5% in 2017.
Tax rate for full-year 2017 is likely to be around 32%. Operating cash flows are anticipated to be about $0.8 billion, excluding any discrete items, while capital expenditure for supporting the company’s growth plans are projected to be in the range of 5–6% of sales.
From 2015 onward, Autoliv has signed various agreements with original equipment manufacturers to supply replacement airbag inflators. The company expects that deliveries will be above 30 million units over the 2015–2018 period.
Price Performance
Autoliv has underperformed the Zacks categorized Auto/Truck-Original Equipment industry over a year. During this period, the company’s share price gained 8.4%, while the industry saw a 16.8% increase.
Zacks Rank
Currently, Autoliv carries a Zacks Rank #5 (Strong Sell).
Honda Motor has long-term expected growth rate of 23.97%.
Ferrari has long-term expected growth rate of 17.47%.
Spartan Motors has long-term expected growth rate of 15%.
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Autoliv (ALV) Misses Q4 Earnings and Revenues Estimates
Autoliv, Inc. (ALV - Free Report) reported adjusted earnings of $1.71 per share in the fourth quarter of 2016 that missed the Zacks Consensus Estimate of $1.83. Also, earnings decreased 17.8% from $2.08 per share reported a year ago. Earnings per share, on a reported basis, amounted to $1.67 in fourth quarter of 2016 compared with $2.10 in the year-ago quarter.
Autoliv reported record consolidated quarter revenues of $2.6 billion, up 3.3% year over year, but missed the Zacks Consensus Estimate of $2.69 billion. Excluding negative currency translation effects and the impact of acquisitions, organic sales improved 1.1%, exceeding the company’s expectation of flat organic sales.
Operating income decreased 15.1% to $238.7 million (or 9.2% of sales) from $281.3 million (or 11.2% of sales) in the year-ago quarter. Adjusted operating margin was 9.3% in the reported quarter, in line with the company’s expectation of above 9%.
Shares of the company fell around 8.2% to close at $106.80 on Feb 2 on the company’s weaker than expected top and bottom line.
Autoliv, Inc. Price, Consensus and EPS Surprise
Autoliv, Inc. Price, Consensus and EPS Surprise | Autoliv, Inc. Quote
Full-Year 2016
Autoliv reported record consolidated revenues of $10.1 billion in 2016, up 9.8% from 2015. However, revenues narrowly missed the Zacks Consensus Estimate of $10.2 billion. Excluding negative currency translation effects of 2% and the impact of acquisitions of close to 5%, organic sales improved more than 7%.
Adjusted earnings per share improved 1.5% from 2015 to $6.75 in 2016, but also missed the Zacks Consensus Estimate of $6.84. Earnings were boosted by lower costs, partially offset by currency headwinds.
Segment Results
Sales at the Passive Safety segment fell 1.6% year over year to $2.04 billion in the reported quarter. Excluding negative currency translation effects, organic sales increased almost 1%. The segment’s operating income fell 13.6% to $228.5 million (11.2% of sales) from $264.5 million (12.8% of sales) in the prior-year quarter. Operating margins were weakened by higher expenditure on research and development as well as other costs to support growth.
Sales at the Electronics segment grew 26.1% year over year to $584.1 million. Organic sales were up 3.4%. The Autoliv-Nissin Brake Systems (ANBS) joint venture impacted sales positively. Operating income from the division fell 7.7% to $29.8 million (5.1% of sales) from $32.3 million (7% of sales) in the prior-year quarter. Margins were negatively affected due to costs related to the formation of ANBS and long-term development plans.
Financial Position
Autoliv had cash and cash equivalents of $1.23 billion as of Dec 31, 2016, lower than the $1.33 billion reported as of Dec 31, 2015. Total debt was almost in line year over year at $1.54 billion as of Dec 31, 2016.
In full year 2016, the company’s cash flow from operations increased to $868.4 million from the year-ago figure of $750.5 million. Net capital expenditures rose to $499 million from the year-ago recorded figure of $450 million.
Dividend
On Nov 3, 2016, Autoliv declared a quarterly dividend of 58 cents per share for the first quarter of 2017. The dividend will be paid on Mar 2, to shareholders on record as of Feb 15, 2017.
Guidance
Autoliv expects organic sales to grow by 3% year over year in the first quarter of 2017. Recent acquisitions and currency translations are expected to have a positive impact of about 2% on sales. This impact is likely to result in consolidated sales growth of over 5%. The adjusted operating margin in the first quarter is expected to be around 8%.
Autoliv expects full-year 2017 organic sales to increase around 4%. The recent acquisitions and currency translation are expected have a 2% adverse impact on sales. Based on these factors, consolidated sales are expected to rise around 2%. Adjusted operating margin, excluding costs for capacity alignments and antitrust related matters, is likely to be 8.5% in 2017.
Tax rate for full-year 2017 is likely to be around 32%. Operating cash flows are anticipated to be about $0.8 billion, excluding any discrete items, while capital expenditure for supporting the company’s growth plans are projected to be in the range of 5–6% of sales.
From 2015 onward, Autoliv has signed various agreements with original equipment manufacturers to supply replacement airbag inflators. The company expects that deliveries will be above 30 million units over the 2015–2018 period.
Price Performance
Autoliv has underperformed the Zacks categorized Auto/Truck-Original Equipment industry over a year. During this period, the company’s share price gained 8.4%, while the industry saw a 16.8% increase.
Zacks Rank
Currently, Autoliv carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks in the auto space include Honda Motor Co., Ltd. (HMC - Free Report) , Ferrari N.V. (RACE - Free Report) and Spartan Motors, Inc. , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Honda Motor has long-term expected growth rate of 23.97%.
Ferrari has long-term expected growth rate of 17.47%.
Spartan Motors has long-term expected growth rate of 15%.
Just Released – Driverless Cars: Your Roadmap to Mega-Profits Today
In this latest Special Report, Zacks’ Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making – autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>