Autoliv reports Q2 adjusted EPS $1.87, consensus $2.23

Reports Q2 revenue $2.605B, consensus $2.74B. Autoliv said: “Second quarter sales increased organically* by 0.7%, which was 1.4pp better than global LVP decline of 0.7%. We outperformed in Asia excl. China and in Europe, mainly due to product launches and pricing while we underperformed in Americas and in China, mainly due to lower light vehicle production with certain key customers, as a consequence of weaker sales and inventory reductions. In China, the LVP mix was negative as several models with limited Autoliv content grew strongly. Profitability improved despite a slight net sales decline. Sales were lower than expected, which impacted our profitability in the quarter with an operating leverage at the high end of our normal 20%-30% range. Profits improved mainly due to the successful execution of cost reductions and increased pricing. Indirect headcount continued to decrease. Operating income was $206 million and operating margin was 7.9%. Adjusted operating income improved to $221 million and adjusted operating margin increased from 8.0% to 8.5%. Return on capital employed was 21.0% and adjusted return on capital employed* was 22.5%.”