Autoliv Inc (ALV) SEC Filing 10-Q Quarterly report for the period ending Sunday, September 30, 2018

(Dollars in millions, except per share data)

Q3 2018

Q3 2017

Change

Net sales Continuing Operations

$2,033.0

$1,952.6

4.1%

Operating income Continuing Operations

$192.5

$167.2

15.1%

Operating margin Continuing Operations

9.5%

8.6%

0.9pp

Adjusted operating margin Continuing Operations ¹⁾

9.5%

10.5%

(1.0)pp

Earnings per share Continuing Operations, diluted ^{2, 3)}

$1.34

$1.21

10.7%

Adjusted earnings per share Continuing Operations, diluted ^{1, 2, 3)}

$1.35

$1.64

(17.7)%

Operating cash flow on a consolidated basis

$238.2

$217.9

9.3%

1) Excluding costs for capacity alignments, antitrust related matters and separation of our business segments. 2) Assuming dilution and net of treasury shares. 3) Participating share awards with right to receive dividend equivalents are (under the two class method) excluded from the EPS calculation.

Comments from Mikael Bratt, President & CEO

“Our growth momentum continued in the third quarter. Driven mainly by a large number of product launches in North America, our sales grew organically* by more than 6% despite the decrease in light vehicle production of about 2% according to IHS. We were able to grow faster than light vehicle production in all regions except Rest of Asia, with North America as the main driver with 22% organic* sales growth. The launches are on schedule, with good delivery precision albeit with continued elevated launch related costs, temporarily impacting our profitability progression negatively.

I am pleased that our order intake continued on a high level in the quarter, supporting our growth opportunities for the longer term. Our operating cash flow was solid in the quarter, supporting our full year indication of an operating cash flow for Continuing Operations to be on a similar level as last year.

In the third quarter our industry experienced significant changes in light vehicle production, especially in Europe impacted by WLTP, and in China due to lower consumer demand. As a result, our supply chain, production and logistic systems had to manage significant and late changes to OEM production plans with corresponding uneven utilization of our supply chain, production and logistics assets while at the same time focusing on the many launches and high growth in North America. We see a similar environment for the rest of the year, with continued uncertainty for light vehicle production, especially in China and Europe, with continued uneven asset utilization. We are implementing actions to manage these challenges and we look forward to a gradual improvement in operating leverage over time.

With a never-ending focus on quality and operational excellence, we continue to execute on our growing business volumes and our new opportunities, with extra attention to any changes in light vehicle demand.”