AUBURN HILLS, Mich.,
Jan. 17, 2018 /PRNewswire/
-- BorgWarner Inc. (NYSE: BWA), a global leader in clean and
efficient technology solutions for combustion, hybrid and electric
vehicles, today announced its three-year net new business backlog,
its guidance for full year 2018 and its guidance for first quarter
2018.
Three-Year Net New Business Backlog
The company
expects its net new business backlog to drive a compound annual
organic growth rate of 5.0% - 7.0% from 2017 through 2020, compared
to compound annual industry growth of 0% - 1.0% over the same time
period:
- Net new business within a range of $650
million to $730 million in
2018, $675 million to $800 million in 2019 and $700 million to $825
million in 2020.
- Based on these assumptions, the company's 2020 revenue outlook
is $11.5 billion - $11.8 billion.
- Asia, the Americas and
Europe are expected to account for
approximately 41%, 38% and 21%, respectively, of the total net new
business backlog over the three-year period.
-
- Approximately 30% is expected in China.
- The net new business backlog represents growth across all
propulsion architectures with combustion, hybrid and electric
vehicles expected to account for approximately 50%, 45% and 5%,
respectively, of the total net new business backlog over the
three-year period.
Full Year 2018 Guidance
The company also provided its
initial guidance for full year 2018:
- Net sales of $10.4 billion -
$10.6 billion, implying organic sales
growth of 5.0% to 7.0% compared with expected 2017 net sales of
$9.79 billion.
-
- Foreign currencies are expected to increase sales by
$75 million, primarily due to the
appreciation of the Euro.
- The purchase of Sevcon is expected to increase sales by
$45 million.
- Excluding the impact of stronger foreign currencies and the
acquisition of Sevcon, net sales growth is expected to be 5.0% to
7.0%.
- Operating income as a percentage of net sales of 12.6% - 12.7%
compared to 12.5% in 2017.
-
- The acquisition of Sevcon is expected to decrease margins by
approximately 10 basis points.
- Net earnings of $4.15 to
$4.25 per diluted share.
-
- The acquisition of Sevcon is expected to be ($0.06) dilutive to EPS. Excluding this impact,
guidance implies a 10% to 12.5% year-over-year improvement in
EPS.
- Effective tax rate of approximately 29%, exclusive of any
impact of the new U.S. tax act.
- Free cash flow within a range of $500
million to $550 million.
- Share repurchases of approximately $100
million.
First Quarter 2018 Guidance
The company also provided
guidance for first quarter 2018:
- Organic net sales growth of 3.0% to 5.5% compared with first
quarter 2017 net sales of $2.41
billion.
-
- Foreign currencies are expected to increase sales by
$70 million, or +2.9%.
- The acquisition of Sevcon is expected to increase revenue by
$15 million.
- Net earnings of $0.97 to
$1.01 per diluted share.
About BorgWarner
BorgWarner Inc. (NYSE: BWA) is a
global product leader in clean and efficient technology solutions
for combustion, hybrid and electric vehicles. With manufacturing
and technical facilities in 64 locations in 17 countries, the
company employs approximately 27,000 worldwide. For more
information, please visit borgwarner.com.
Statements contained in this news release may contain
forward-looking statements as contemplated by the 1995 Private
Securities Litigation Reform Act that are based on management's
current expectations, estimates and projections. Words such as
"outlook," "expects," "anticipates," "intends," "plans,"
"believes," "estimates," variations of such words and similar
expressions are intended to identify such forward-looking
statements. Forward-looking statements are subject to risks and
uncertainties, many of which are difficult to predict and generally
beyond our control, that could cause actual results to differ
materially from those expressed, projected or implied in or by the
forward-looking statements. Such risks and uncertainties include:
fluctuations in domestic or foreign vehicle production, the
continued use of outside suppliers, fluctuations in demand for
vehicles containing our products, changes in general economic
conditions, and other risks detailed in our filings with the
Securities and Exchange Commission, including the Risk Factors,
identified in our most recently filed Annual Report on Form 10-K.
We do not undertake any obligation to update any forward-looking
statements.
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SOURCE BorgWarner Inc.