morning, you, everyone. and Thank good Fred,
quarter to Before our brief I results. like of a dive I’d provide the first into financials, overview
America First, higher and we outgrowth in in production reported North despite driven Europe industry organic double-digit and growth by the China production weaker revenue quarter. during
would inflation increase eProduct on both performance. we headwinds, expected during last margin indicated call. planned remain earnings a related Despite this, full we reflected net performance investment we and margin believe for in our R&D had of which headwinds be quarter’s our track year Second,
for revenue a X Let’s at turn slide walk year-over-year look for QX. our to
Last year’s QX billion. revenue was just under $X.X
of revenue can X% You That revenue, an decrease in can see $XXX increase production. X% see approximately that Then, approximately in average U.S. dollar strengthening the market in weighted million. over increase our a organic compares drove or the XX% year-over-year. to year-over-year about you
Finally, $X.X all of The revenue added Santroll million $XX of billion just QX. in the and acquisitions this revenue of to under was year-over-year. sum Rhombus
slide XX. to Turning
see flow can and performance our You quarter. for the earnings cash
Our of the about On compares of foreign $XX of increase income headwinds. inflation impact XX.X% M&A, $XXX first $XX adjusted sales. to million includes equating million was million and operating This ago. of operating to a million, $XXX exchange adjusted year of X.X% other income a quarter performance comparable That increased net from impact income and or cost commodity and the basis, of on a higher excluding R&D eProduct material margin. adjusted a million $XX operating million $XXX planned
to As on headwinds have inflation call, QX mentioned XXXX. to as we’re recovery anticipated carry extent process into from cost of we quarter’s mechanisms the which of last level our we the a customers material in negotiating with XXXX still higher
we relative lower remaining these couple the the over expect margin the discussions we of is largely We QX which XXXX. thought of one quarters of quarters, to to reasons have a would complete in next
and on net eR&D additional approximately both our converted Excluding sales. inflation, these costs, at higher material XX% we
the ago, in in a adjusted year-over-year the quarter Our driven $X.XX EPS operating share share a and our year. adjusted first repurchases of lower income $XXX compared by we from to count by resulting last executed million increase improved the year
And flow. finally, free cash
million to of QX. Our quarter, our quarter due capital the higher annual incentive we for in normally the during the the was performance, $XXX and compensation support capital increased Company’s a eProducts, which usage prior first flow free payout in cash spending to growth working the year’s during make
our You’ll the quarter implied ahead guidance. of rate during the full first spending the was by capital of note pace that year
capital that our internal putting we we’re ramp-up is support necessary planning was the this the However, with believe revenue. line our place as in in in eProduct to
industry where Let’s perspective see our you global now XXXX. production slide turn on to can XX, for
up our We prior expect light compared global markets unchanged vehicle year, guidance. be this commercial and our is flat which to to to weighted X%
outlook, However, overall are within expectations this our mixed. regional
be in first flat market in bit to during we start to is overall our planning previous Europe, saw is up X%, slightly blended of weaker-than-anticipated due than our X% And than quarter. to we our higher forecast up Specifically, In previous the X%, to X% based down America, markets markets be in China, expect production the our expect a to we’re expectation worse year. large which which part on the we roughly be the approximately to stronger about weighted the X%. North to up
outlook Now, let’s our full year at slide on XX. take look a
it’s an million our is First, note million. in full year revenue $XXX expected an to versus of assumes of stronger guidance $XX important improvement This guidance. now our from prior that foreign currencies tailwind
up to revenue industry mentioned, in important by you our modest launches, change in cost eProduct expected contributes various expect a inflationary the of to business see flat to end especially recovery to to the new and we excess X% as growth our the markets for net But our grow for customers than we our markets, in from our expectations I increase in previously be sales slide. continue organic portfolio. which Second, production, on modest year, driven the end more expect
expecting to and $X.X significantly between is are from we it up XXXX. in As revenue, deliver $X.X approximately relates XXXX, which generated eProduct $X.X to the billion in billion we billion
to Finally, are the Rhombus add million Santroll, to and acquisitions expected revenue. XXXX SSE $XX
Based than of revenue our revenue on SSE approximately $XX.X the $XX.X billion $XX.X equates expectations, of total billion, the of XXXX is expectations. X.X% in and to This to higher impact slightly range we’re billion the billion to XX.X%. recently foreign these customer to projecting organic of $XX.X due to currencies, acquisition higher growth which recovery our previous guidance of completed
margin. to Switching
compared We year adjusted of be to range margin XX.X%. margin XX.X% continue our to to of XXXX to our full expect in operating XX.X% the
ongoing our in guidance business our $XX portfolio. support R&D success million continuing lean to electrified investment. to R&D, more eProduct forward investing to anticipate to relates in we’re eProduct-related R&D it by million a our to wins, year new securing XXXX increase $XX With continues As full
in eProduct of of the in contemplates Excluding impact the outlook incrementals margin around business XXXX per in this inclusive $X.XX $XX R&D, net to in Based and outlook, related the range of on adjusted we’re full delivering $X.XX EPS year inflationary revenue this increase margin of share. headwinds full expecting diluted mid-teens, year our million. the
Turning cash to free flow.
the year. We continue $XXX full flow free of that for range deliver we’ll to $XXX cash million the expect to in million
Systems Fuel includes onetime planned cash of million this Aftermarket the outlook related businesses. $XXX a to spinoff flow of As approximately and reminder, our cost cash
free million is slightly That’s which cash flow cash million would of our than in $XXX outlook. million lower XXXX. cost, $XXX free XXXX $XXX to our onetime flow we this Excluding be guidance the only generated record
Drivetrain starting segments: an see to reporting XX, eProduct into you segment slide quarter first increase made In disclosure we’ve ePropulsion separate our new transparency decision, previous to Turning the our to two and ePropulsion. & for can segment break & the profitability, effort with into Systems. Battery Drivetrain ePropulsion our external
electronics, ePropulsion onboard chargers. including and includes inverters, eGearDrives, Our segment multiple eMotors, IDMs other eProducts, such as power
roughly revenue for in the account to eProducts XXXX. two-thirds these segment’s expect We of
to expected is segment ePropulsion in account the for XXXX. addition, approximately total In BorgWarner’s revenue eProduct two-thirds of
the but this in first outlook operating to positive slightly the $XXX As a isn’t by expected the with million And growth keep million negative the coming you to $XXX fourth The R&D conversion believe expected by quarter. ePropulsion expected profit margin have on a the million quarter, be of margin fourth gross and in quarterly improved to segment. can revenue an the QX. the see, a to increasing margin as in is for the pace We it’s in grow the eProduct significant you to growth margin of can as eProduct segment quarter $XXX revenue see, business driver quarters. reported revenue compared to in operating the revenue in is result growth expected will
we the to starts see upfront of We this improve to acceleration look growth profitability That’s of growth, trajectory because a that as continue our is forward to profitability. and eProducts leading the conversion XXXX. believe revenue overcome R&D of cost investments, illustration beyond as that thereby profitability to expect the more Importantly, each we on generally. starts in we good eProduct very to expect other
market So, was first performance, eProducts investment line in Overall, planned strong. the foundational remarks. incremental broadly let quarter were margin with and excluding me with outlook. products, We and our various results my our inflation by financial net prior and growth our eR&D driven summarize outgrew
we continue of businesses. our the steps In financial take addition, transparency eProduct increase to to
to to in support to the compared revenue the which by to deliver eProduct make profitable third work happen expect we of now successfully XXXX, we complete strong portfolio. outperformance to production, As investments to look the the industry PHINIA, continue to to expect and growth spin-off end ahead we our of to the continue necessary quarter
the back Pat. With over to call like that, I’d to turn
