Autoliv Inc (ALV) Reports Strong Q3 2023 Earnings with 13% Increase in Net Sales
Autoliv Inc (NYSE:ALV) reports $2,596 million in net sales, marking a 13% increase
EPS stands at $1.57, reflecting a 30% increase
Operating margin improves to 8.9% from 7.4% in Q3 2022
Operating cash flow remains strong at $202 million
Autoliv Inc (NYSE:ALV), a global leader in automotive safety systems, released its Q3 2023 earnings report on October 20, 2023. The company reported a strong quarter with significant growth in net sales and earnings per share (EPS).
Financial Performance
Autoliv Inc (NYSE:ALV) reported net sales of $2,596 million in Q3 2023, a 13% increase compared to the same period in the previous year. The company's organic sales growth was 11%, outperforming the global LVP growth of 3.8%. The company attributes this growth to new product launches and higher prices.
The company's EPS stood at $1.57, marking a 30% increase. The adjusted EPS was $1.66, reflecting a 35% increase. The operating margin improved to 8.9% from 7.4% in Q3 2022. The adjusted operating margin was 9.4%, up from 7.5% in the same period last year.
Key Business Developments
Autoliv Inc (NYSE:ALV) reported substantial profitability improvement in Q3 2023, positively impacted by price increases, organic growth, and cost reduction activities. The company's operating income was $232 million, and the operating margin was 8.9%. The adjusted operating income improved from $173 million to $243 million, and the adjusted operating margin increased from 7.5% to 9.4%.
Despite inflationary pressure and adverse FX effects, the return on capital employed was 24%, and the adjusted return on capital employed was 25%. The operating cash flow remained strong at $202 million, albeit declining from $232 million, mainly due to temporary negative working capital effects.
Outlook
For the full year 2023, Autoliv Inc (NYSE:ALV) expects around 17% organic sales growth, around 1% positive FX effect on net sales, around 8.5% - 9.0% adjusted operating margin, and around $900 million operating cash flow.
Commentary
Our performance in the third quarter was very encouraging. Our organic sales growth continued to significantly outperform LVP and the adjusted operating income was a new third quarter record since the spin-off in 2018," said Mikael Bratt, President & CEO of Autoliv Inc (NYSE:ALV).
Financial Tables
The financial tables provided in the report highlight key figures such as net sales, operating income, adjusted operating income, operating margin, adjusted operating margin, earnings per share, adjusted earnings per share, operating cash flow, return on capital employed, and adjusted return on capital employed. These figures provide a comprehensive overview of Autoliv Inc (NYSE:ALV)'s financial performance in Q3 2023.
Analysis
Autoliv Inc (NYSE:ALV)'s strong Q3 2023 performance demonstrates the company's resilience and ability to adapt to market dynamics. The significant growth in net sales and EPS, coupled with the improvement in operating margin, indicates a robust financial health. The company's outlook for the full year 2023 also suggests continued growth and profitability.
This article first appeared on GuruFocus.
