Press release
Strong organic sales growth in Europe and improved adjusted operating margin
(Stockholm, April 22, 2015) – – – For the three-month period ended March 31, 2015, Autoliv, Inc. (NYSE: ALV and SSE: ALIV.Sdb) – the worldwide leader in automotive safety systems – reported consolidated sales of $2,174 million. Quarterly organic sales* grew by close to 4%. The adjusted operating margin* was 8.9% (for non-U.S. GAAP measures see enclosed reconciliation tables).
The expectation at the beginning of the quarter was for organic sales growth of “around 3%” and an adjusted operating margin of “around 8%”. The higher than expected sales growth came mainly from strong sales in Europe. The reported operating margin of 3.7% was negatively affected by antitrust related settlements and the on-going capacity alignment in Europe by a total of around $113 million.
For the second quarter of 2015, the Company expects organic sales to increase by around 6% and an adjusted operating margin of around 9%. The expectation for the full year is for organic sales growth of more than 6% and an adjusted operating margin of around 9.5%.
Key Figures
For Key Figures summary table, please refer to attached file below.
Comments from Jan Carlson, Chairman, President & CEO
“I am pleased with our first quarter performance. Organic sales and adjusted operating margin were both stronger than anticipated at the beginning of the quarter. These positive developments were primarily driven by strong sales in Europe, for both passive and active safety products, coupled with lower than anticipated overhead costs.
For the quarter we again experienced strong growth in active safety and we continue to grow the business while investing in research and development for long term success in this growth area.
As anticipated, our sales in China showed modest growth in the quarter. This was due to a challenging customer mix first experienced in the second half of 2014, which we expect will gradually improve throughout 2015.
We have continued to adjust our capital structure and we have now reached a leverage ratio for the Company of 0.5 times, which is within our long-term target range of 0.5 to 1.5 times originally communicated at our Capital Market Day in 2013. This has primarily been achieved by direct shareholder returns through share repurchases and dividends. In our cyclical industry this range gives us flexibility to grow the Company while being prepared for potential costs associated with on-going antitrust matters.
During the quarter we made progress in our antitrust related matters by reaching additional settlements and we continued to execute on our European capacity alignment program, which is important for the long term competitiveness of our European operations. We further executed well on our improvements in steering wheels and on our vertical integration strategy while our operations in Brazil remains a challenge due to the continued declining vehicle production.
We continue into 2015 with strong focus on quality leadership, execution and further buildup of our active safety capabilities, while working towards our ultimate vision of saving more lives.”
An earnings conference call will be held at 3:00 p.m. (CET) today, April 22. To follow the webcast or to obtain the pin code and phone number, please access www.autoliv.com. The conference slides will be available on our web site as soon as possible following the publication of this earnings report.