BorgWarner Reports 2004 Earnings

BorgWarner has reported 2004 earnings of $3.86 per share on sales of $3.5 billion. The company reiterated its 2005 earnings expectations in a range of $4.30 to $4.55 per share, which includes assumptions about the company's Beru acquisition in a range of 15 cents to 30 cents per share, and expectations of $4.15 to $4.25 per share on the company's base business as a comparison to 2004 expectations.

AUBURN HILLS, MI — BorgWarner has reported 2004 earnings of $3.86 per share on sales of $3.5 billion.

The company reiterated its 2005 earnings expectations in a range of $4.30 to $4.55 per share, which includes assumptions about the company’s Beru acquisition in a range of 15 cents to 30 cents per share, and expectations of $4.15 to $4.25 per share on the company’s base business as a comparison to 2004 expectations.

For fourth quarter 2004, sales were $889.2 million, up 11 percent from $798.8 million in fourth quarter 2003. Net income in the quarter was $67.7 million, or $1.19 per share, compared with $50 million, or 90 cents per share in last year’s fourth quarter. Fourth quarter 2004 net income included favorable year-end adjustments to tax accounts of $11.4 million, or 20 cents per share.

Sales for 2004 totaled $3.5 billion compared with $3.1 billion in 2003. Full-year 2004 net income was $218.3 million, or $3.86 per share, compared with $174.9 million, or $3.20 per share in 2003. Full-year 2004 net income includes favorable year-end adjustments to tax accounts of $11.4 million, or 20 cents per share.

The company said fourth quarter and full-year 2004 net income excluding the favorable year-end adjustments to tax accounts is representative of recurring net income and is provided for comparisons with other quarterly and annual results. The increase in the Euro and other currencies added $114.3 million to sales in 2004 compared with 2003, and $11 million to net income.

Operating income was $81.9 million or 9.2 percent of sales in the 2004 fourth quarter and $309.1 million or 8.8 percent for the full year. These amounts compare with $76.0 million or 9.5 percent of sales in the 2003 fourth quarter and $269.9 million or 8.8 percent for the 2003 full year. Research and development spending was $32.4 million in the quarter and $123.1 million for the full year, versus $30.8 million and $118.2 million in the same periods in 2003.

Net cash provided by operating activities was a record $426.6 million in 2004. Investments in capital expenditures and net tooling totaled $252.4 million for 2004, compared with $214.4 million for 2003. Debt declined $37.8 million and cash and cash equivalents increased $116.6 million in 2004.

For more information about BorgWarner, go to: www.bwauto.com.

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