Autoliv Tops Q4 Earnings Estimates Despite Sales Miss, Cost Controls Drive Margin Gains

Autoliv, Inc. ALV shares are trading lower in the premarket session on Friday.

The company reported fourth-quarter adjusted earnings per share of $3.05, beating the analyst consensus estimate of $2.83. Quarterly sales of $2.62 billion missed the street view of $2.70 billion.

The company reported a 4.9% decrease in net sales and a 3.3% decline in organic sales in the fourth quarter.

“Our strong performance for both the quarter and the full year was mainly a result of our strict cost control,” said Mikael Bratt, President & CEO. “Our structural cost reduction program has enabled a reduction of the indirect work force by 1,400 since Q1 2023.”

Adjusted operating income in the quarter under review was $349 million, higher than $334 million in the year-ago period, with adjusted operating margin rising to 13.4% from 12.1% a year ago.

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The return on capital employed in the quarter under review was 35.8%, and the adjusted return on capital employed was 35.2%. 

Autoliv stated that while it secured several strategic wins with new automakers in 2024, OEMs’ sourcing of new business was low due to technological and geopolitical uncertainties, with the sourcing of large platforms being delayed until 2025.

Outlook: For the full year 2025, the company expects approximately 2% organic sales growth, a negative foreign exchange effect of around 2% on net sales, an adjusted operating margin of around 10-10.5% and operating cash flow of approximately $1.2 billion.

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