Strong Bookings and Record Revenue
DUBLIN, May 4, 2023
/PRNewswire/ -- Aptiv PLC (NYSE: APTV), a global technology
company focused on making mobility safer, greener and more
connected, today reported first quarter 2023 U.S. GAAP earnings of
$0.54 per diluted share. Excluding
special items, first quarter earnings totaled $0.91 per diluted share.
First Quarter Financial Highlights Include:
-- U.S. GAAP revenue of $4.8
billion, an increase of 15%
- Revenue increased 15% adjusted for currency exchange,
commodity movements and acquisitions; growth over market of 6%
based on AWM1 of 9%
-- U.S. GAAP net income of $146
million, diluted earnings per share of $0.54
- Excluding special items, diluted earnings per share of
$0.91
-- U.S. GAAP operating income margin of 7.2%
- Adjusted Operating Income margin of 9.1%, Adjusted Operating
Income of $437 million; Adjusted
EBITDA margin of 12.3%; Adjusted EBITDA of $594 million
-- Returned $70 million to
shareholders through share repurchases
"We had a strong start to the year with record revenue and
near-record bookings in the first quarter, underscoring Aptiv's
increasing competitive differentiation and strategic value to our
customers as the industry transitions further towards the
fully-electrified, software-defined vehicle," said Kevin Clark, chairman and chief executive
officer. "Bolstered by our recent acquisitions of Wind River and
Intercable Automotive, we continue to gain commercial traction
across our portfolio, particularly in our Smart Vehicle
ArchitectureTM and high voltage platforms. Combined with
our relentless focus on execution and operational excellence, we
remain confident in our ability to deliver on our outlook for
2023."
1
Represents global vehicle production weighted to the
geographic regions in which the Company generates its revenue
("AWM").
|
First Quarter 2023 Results
For the three months ended March 31, 2023, the Company
reported U.S. GAAP revenue of $4.8
billion, an increase of 15% from the prior year period.
Adjusted for currency exchange, commodity movements and
acquisitions, revenue increased by 15% in the first quarter. This
reflects growth of 24% in Europe,
14% in North America, 7% in
Asia, which includes an increase
of 2% in China, and 11% in
South America, our smallest
region.
The Company reported first quarter 2023 U.S. GAAP net income of
$146 million and earnings of
$0.54 per diluted share, compared to
$73 million and $0.27 per diluted share in the prior year period.
First quarter Adjusted Net Income, a non-GAAP financial measure
defined below, totaled $258 million,
or earnings of $0.91 per diluted
share, compared to $180 million, or
$0.63 per diluted share, in the prior
year period.
First quarter Adjusted Operating Income, a non-GAAP
financial measure defined below, was $437
million, compared to $324
million in the prior year period. Adjusted Operating Income
margin was 9.1%, compared to 7.8% in the prior year period,
reflecting our revenue growth over market of 6%, increased global
vehicle production, pricing and the results from our recent
acquisitions. Depreciation and amortization expense totaled
$216 million, an increase from
$191 million in the prior year
period.
Interest expense for the first quarter totaled $67 million, an increase from $43 million in the prior year period, which
primarily reflects impacts from our $2.5
billion debt issuance in the middle of the first quarter of
2022 in anticipation of the Wind River Systems, Inc.
acquisition.
Tax expense in the first quarter of 2023 was $34 million, resulting in an effective tax rate
of approximately 12%. Tax expense in the first quarter of 2022 was
$21 million, resulting in an
effective tax rate of approximately 12%.
Net cash flow used in operating activities totaled $9
million in the first quarter, compared to $202 million in the prior year period. As
of March 31, 2023, the Company had cash and cash equivalents
of $1.1 billion and total available liquidity of
$3.6 billion.
Reconciliations of Adjusted Revenue Growth, Adjusted Net Income,
Adjusted Net Income Per Share, Adjusted Operating Income, Adjusted
EBITDA and Cash Flow Before Financing, which are non-GAAP measures,
to the most directly comparable financial measures, respectively,
calculated and presented in accordance with accounting principles
generally accepted in the United
States ("GAAP") are provided in the attached supplemental
schedules.
Share Repurchase Program
During the first quarter of 2023, the Company repurchased 0.6
million shares for approximately $70
million, leaving approximately $1.9
billion available for future share repurchases. All
repurchased shares were retired.
Full Year 2023 Outlook
The Company's full year 2023 financial guidance is as
follows:
(in millions, except
per share amounts)
|
Full Year
2023
|
Net sales
|
$18,700 -
$19,300
|
Adjusted
EBITDA
|
$2,585 -
$2,745
|
Adjusted EBITDA
margin
|
13.8% -
14.2%
|
Adjusted operating
income
|
$1,920 -
$2,080
|
Adjusted operating
income margin
|
10.3% -
10.8%
|
Adjusted net income per
share (1)
|
$4.00 -
$4.50
|
Cash flow from
operations
|
$1,900
|
Capital
expenditures
|
$950
|
Adjusted effective tax
rate
|
~14.5%
|
|
(1) The Company's full year 2023 financial guidance
includes approximately $1.10 per diluted share for the anticipated
equity losses to be recognized by Aptiv from the performance of the
Motional autonomous driving joint venture.
|
Conference Call and Webcast
The Company will host a conference call to discuss these results
at 8:00 a.m. (ET) today, which is
accessible by dialing +1.800.239.9838 (U.S.) or +1.323.794.2577
(international) or through a webcast at ir.aptiv.com. The
conference ID number is 1161786. A slide presentation will
accompany the prepared remarks and has been posted on the investor
relations section of the Company's website. A replay will be
available two hours following the conference call.
Use of Non-GAAP Financial Information
This press release contains information about Aptiv's financial
results which are not presented in accordance with GAAP.
Specifically, Adjusted Revenue Growth, Adjusted Operating Income,
Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income Per Share
and Cash Flow Before Financing are non-GAAP financial measures.
Adjusted Revenue Growth represents the year-over-year change in
reported net sales relative to the comparable period, excluding the
impact on net sales from currency exchange, commodity movements,
acquisitions, divestitures and other transactions. Adjusted
Operating Income represents net income before interest expense,
other income (expense), net, income tax (expense) benefit, equity
income (loss), net of tax, amortization, restructuring, other
acquisition and portfolio project costs (which includes costs
incurred to integrate acquired businesses and to plan and execute
product portfolio transformation actions, including business and
product acquisitions and divestitures), asset impairments and other
related charges, compensation expense related to acquisitions and
gains (losses) on business divestitures and other transactions.
Adjusted Operating Income margin is defined as Adjusted Operating
Income as a percentage of net sales. Adjusted EBITDA represents net
income before depreciation and amortization (including asset
impairments), interest expense, income tax (expense) benefit, other
income (expense), net, equity income (loss), net of tax,
restructuring and other special items.
Adjusted Net Income represents net income attributable to Aptiv
before amortization, restructuring and other special items,
including the tax impact thereon. Adjusted Net Income Per Share
represents Adjusted Net Income divided by the Adjusted Weighted
Average Number of Diluted Shares Outstanding for the period. The
Adjusted Weighted Average Number of Diluted Shares Outstanding
assumes the application of the if-converted method of share
dilution, if not already applied for GAAP purposes of calculating
the weighted average number of diluted shares outstanding. Cash
Flow Before Financing represents cash provided by (used in)
operating activities plus cash provided by (used in) investing
activities, adjusted for the purchase price of business
acquisitions and other transactions, the cost of significant
technology investments and net proceeds from the divestiture of
discontinued operations and other significant businesses.
Management believes the non-GAAP financial measures used in this
press release are useful to both management and investors in their
analysis of the Company's financial position, results of operations
and liquidity. In particular, management believes Adjusted Revenue
Growth, Adjusted Operating Income, Adjusted EBITDA, Adjusted Net
Income, Adjusted Net Income Per Share and Cash Flow Before
Financing are useful measures in assessing the Company's ongoing
financial performance that, when reconciled to the corresponding
GAAP measure, provide improved comparability between periods
through the exclusion of certain items that management believes are
not indicative of the Company's core operating performance and that
may obscure underlying business results and trends. Management also
uses these non-GAAP financial measures for internal planning and
forecasting purposes.
Such non-GAAP financial measures are reconciled to the most
directly comparable GAAP financial measures in the attached
supplemental schedules at the end of this press release. Non-GAAP
measures should not be considered in isolation or as a substitute
for our reported results prepared in accordance with GAAP and, as
calculated, may not be comparable to other similarly titled
measures of other companies.
About Aptiv
Aptiv is a global technology company that develops safer,
greener and more connected solutions enabling a more sustainable
future of mobility. Visit aptiv.com.
Forward-Looking Statements
This press release, as well as other statements made by Aptiv
PLC (the "Company"), contain forward-looking statements that
reflect, when made, the Company's current views with respect to
current events, certain investments and acquisitions and financial
performance. Such forward-looking statements are subject to many
risks, uncertainties and factors relating to the Company's
operations and business environment, which may cause the actual
results of the Company to be materially different from any future
results. All statements that address future operating,
financial or business performance or the Company's strategies or
expectations are forward-looking statements. Factors that could
cause actual results to differ materially from these
forward-looking statements include, but are not limited to, the
following: global and regional economic conditions, including
conditions affecting the credit market; global inflationary
pressures; uncertainties posed by the COVID-19 pandemic and the
difficulty in predicting its future course and its impact on the
global economy and the Company's future operations; uncertainties
created by the conflict between Ukraine and Russia, and its impacts to the European and
global economies and our operations in each country; fluctuations
in interest rates and foreign currency exchange rates; the cyclical
nature of global automotive sales and production; the potential
disruptions in the supply of and changes in the competitive
environment for raw material and other components integral to the
Company's products, including the ongoing semiconductor supply
shortage; the Company's ability to maintain contracts that are
critical to its operations; potential changes to beneficial free
trade laws and regulations such as the
United States-Mexico-Canada Agreement; changes to tax laws;
the ability of the Company to integrate and realize the expected
benefits of recent transactions; the ability of the Company to
attract, motivate and/or retain key executives; the ability of the
Company to avoid or continue to operate during a strike, or partial
work stoppage or slow down by any of its unionized employees or
those of its principal customers; and the ability of the Company to
attract and retain customers. Additional factors are discussed
under the captions "Risk Factors" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in the
Company's filings with the Securities and Exchange Commission. New
risks and uncertainties arise from time to time, and it is
impossible for us to predict these events or how they may affect
the Company. It should be remembered that the price of the
ordinary shares and any income from them can go down as well as up.
The Company disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events and/or otherwise, except as may be
required by law.
APTIV
PLC CONSOLIDATED STATEMENTS OF
OPERATIONS (Unaudited)
|
|
|
Three Months Ended
March 31,
|
|
2023
|
|
2022
|
|
(in millions, except
per share amounts)
|
Net sales
|
$
4,818
|
|
$
4,178
|
Operating
expenses:
|
|
|
|
Cost of
sales
|
4,058
|
|
3,589
|
Selling, general and
administrative
|
342
|
|
274
|
Amortization
|
59
|
|
37
|
Restructuring
|
11
|
|
22
|
Total operating
expenses
|
4,470
|
|
3,922
|
Operating
income
|
348
|
|
256
|
Interest
expense
|
(67)
|
|
(43)
|
Other expense,
net
|
(1)
|
|
(39)
|
Income before income
taxes and equity loss
|
280
|
|
174
|
Income tax
expense
|
(34)
|
|
(21)
|
Income before equity
loss
|
246
|
|
153
|
Equity loss, net of
tax
|
(82)
|
|
(63)
|
Net income
|
164
|
|
90
|
Net income attributable
to noncontrolling interest
|
3
|
|
1
|
Net loss attributable
to redeemable noncontrolling interest
|
(1)
|
|
—
|
Net income attributable
to Aptiv
|
162
|
|
89
|
Mandatory convertible
preferred share dividends
|
(16)
|
|
(16)
|
Net income attributable
to ordinary shareholders
|
$
146
|
|
$
73
|
|
|
|
|
Diluted net income per
share:
|
|
|
|
Diluted net income per
share attributable to ordinary shareholders
|
$
0.54
|
|
$
0.27
|
Weighted average
number of diluted shares outstanding
|
271.17
|
|
271.16
|
APTIV
PLC CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
March 31,
2023
|
|
December 31,
2022
|
|
(Unaudited)
|
|
|
(in
millions)
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
1,100
|
|
$
1,531
|
Accounts receivable,
net
|
3,564
|
|
3,433
|
Inventories
|
2,485
|
|
2,340
|
Other current
assets
|
576
|
|
480
|
Total current
assets
|
7,725
|
|
7,784
|
Long-term
assets:
|
|
|
|
Property,
net
|
3,545
|
|
3,495
|
Operating lease
right-of-use assets
|
443
|
|
451
|
Investments in
affiliates
|
1,651
|
|
1,723
|
Intangible assets,
net
|
2,534
|
|
2,585
|
Goodwill
|
5,099
|
|
5,106
|
Other long-term
assets
|
719
|
|
740
|
Total long-term
assets
|
13,991
|
|
14,100
|
Total
assets
|
$
21,716
|
|
$
21,884
|
LIABILITIES,
REDEEMABLE NONCONTROLLING INTEREST AND
SHAREHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Short-term
debt
|
$
45
|
|
$
31
|
Accounts
payable
|
2,996
|
|
3,150
|
Accrued
liabilities
|
1,467
|
|
1,684
|
Total current
liabilities
|
4,508
|
|
4,865
|
Long-term
liabilities:
|
|
|
|
Long-term
debt
|
6,473
|
|
6,460
|
Pension benefit
obligations
|
368
|
|
354
|
Long-term operating
lease liabilities
|
355
|
|
361
|
Other long-term
liabilities
|
740
|
|
750
|
Total long-term
liabilities
|
7,936
|
|
7,925
|
Total
liabilities
|
12,444
|
|
12,790
|
Commitments and
contingencies
|
|
|
|
Redeemable
noncontrolling interest
|
97
|
|
96
|
|
|
|
|
Total Aptiv
shareholders' equity
|
8,983
|
|
8,809
|
Noncontrolling
interest
|
192
|
|
189
|
Total shareholders'
equity
|
9,175
|
|
8,998
|
Total liabilities,
redeemable noncontrolling interest and shareholders'
equity
|
$
21,716
|
|
$
21,884
|
APTIV
PLC CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS (Unaudited)
|
|
|
Three Months Ended
March 31,
|
|
2023
|
|
2022
|
|
(in
millions)
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
164
|
|
$
90
|
Adjustments to
reconcile net income to net cash used in operating
activities:
|
|
|
|
Depreciation and
amortization
|
216
|
|
191
|
Restructuring expense,
net of cash paid
|
(24)
|
|
7
|
Deferred income
taxes
|
(7)
|
|
(1)
|
Loss from equity
method investments, net of dividends received
|
82
|
|
63
|
Other, net
|
33
|
|
15
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts receivable,
net
|
(131)
|
|
(270)
|
Inventories
|
(144)
|
|
(298)
|
Accounts
payable
|
(73)
|
|
1
|
Other, net
|
(117)
|
|
4
|
Pension
contributions
|
(8)
|
|
(4)
|
Net cash used in
operating activities
|
(9)
|
|
(202)
|
Cash flows from
investing activities:
|
|
|
|
Capital
expenditures
|
(269)
|
|
(247)
|
Proceeds from sale of
property
|
—
|
|
2
|
Cost of business
acquisitions and other transactions, net of cash
acquired
|
(38)
|
|
(220)
|
Proceeds from sale of
technology investments
|
—
|
|
2
|
Cost of technology
investments
|
(1)
|
|
(1)
|
Settlement of
derivatives
|
(1)
|
|
(1)
|
Net cash used in
investing activities
|
(309)
|
|
(465)
|
Cash flows from
financing activities:
|
|
|
|
Decrease in other
short and long-term debt, net
|
(8)
|
|
(1)
|
Proceeds from issuance
of senior notes, net of issuance costs
|
—
|
|
2,472
|
Dividend payments of
consolidated affiliates to minority shareholders
|
—
|
|
(8)
|
Repurchase of ordinary
shares
|
(68)
|
|
—
|
Distribution of
mandatory convertible preferred share cash dividends
|
(16)
|
|
(16)
|
Taxes withheld and
paid on employees' restricted share awards
|
(30)
|
|
(36)
|
Net cash (used in)
provided by financing activities
|
(122)
|
|
2,411
|
Effect of exchange rate
fluctuations on cash, cash equivalents and restricted
cash
|
2
|
|
(6)
|
(Decrease) increase in
cash, cash equivalents and restricted cash
|
(438)
|
|
1,738
|
Cash, cash equivalents
and restricted cash at beginning of the period
|
1,555
|
|
3,139
|
Cash, cash equivalents
and restricted cash at end of the period
|
$
1,117
|
|
$
4,877
|
|
|
|
|
Reconciliation of
cash, cash equivalents and restricted cash and cash classified as
assets held
for sale
|
|
|
|
|
March
31,
|
|
2023
|
|
2022
|
|
(in
millions)
|
Cash, cash equivalents
and restricted cash
|
$
1,100
|
|
$
4,877
|
Cash classified as
assets held for sale
|
17
|
|
—
|
Total cash, cash
equivalents and restricted cash
|
$
1,117
|
|
$
4,877
|
APTIV
PLC FOOTNOTES (Unaudited)
|
|
1. Segment
Summary
|
|
|
Three Months Ended
March 31,
|
|
2023
|
|
2022
|
|
%
|
|
(in
millions)
|
|
|
Net Sales
|
|
|
|
|
|
Signal and Power
Solutions
|
$
3,464
|
|
$
3,106
|
|
12 %
|
Advanced Safety and
User Experience
|
1,366
|
|
1,082
|
|
26 %
|
Eliminations and Other
(a)
|
(12)
|
|
(10)
|
|
|
Net Sales
|
$
4,818
|
|
$
4,178
|
|
|
|
|
|
|
|
|
Adjusted Operating
Income
|
|
|
|
|
|
Signal and Power
Solutions
|
$
374
|
|
$
308
|
|
21 %
|
Advanced Safety and
User Experience
|
63
|
|
16
|
|
294 %
|
Adjusted Operating
Income
|
$
437
|
|
$
324
|
|
|
|
|
(a)
|
Eliminations and Other
includes the elimination of inter-segment transactions.
|
2. Weighted Average
Number of Diluted Shares Outstanding
|
|
The following table
illustrates the weighted average shares outstanding used in
calculating basic and diluted net income
per share attributable to ordinary shareholders for the three
months ended March 31, 2023 and 2022:
|
|
|
Three Months Ended
March 31,
|
|
2023
|
|
2022
|
|
(in millions, except
per share amounts)
|
Weighted average
ordinary shares outstanding, basic
|
271.01
|
|
270.79
|
Dilutive shares
related to RSUs
|
0.16
|
|
0.37
|
Weighted average
ordinary shares outstanding, including dilutive shares
|
271.17
|
|
271.16
|
Net income per share
attributable to ordinary shareholders:
|
|
|
|
Basic
|
$
0.54
|
|
$
0.27
|
Diluted
|
$
0.54
|
|
$
0.27
|
APTIV
PLC RECONCILIATION OF NON-GAAP
MEASURES (Unaudited)
|
|
In this press release
the Company has provided information regarding certain non-GAAP
financial measures, including "Adjusted Revenue Growth," "Adjusted
Operating Income," "Adjusted EBITDA," "Adjusted Net Income,"
"Adjusted Net Income Per Share" and "Cash Flow Before Financing."
Such non-GAAP financial measures are reconciled to their closest
GAAP financial measure in the following schedules.
|
|
Adjusted Revenue
Growth: Adjusted Revenue Growth is presented as a supplemental
measure of the Company's financial performance which management
believes is useful to investors in assessing the Company's ongoing
financial performance that, when reconciled to the corresponding
U.S. GAAP measure, provides improved comparability between periods
through the exclusion of certain items that management believes are
not indicative of the Company's core operating performance and
which may obscure underlying business results and trends. Our
management utilizes Adjusted Revenue Growth in its financial
decision making process, to evaluate performance of the Company and
for internal reporting, planning and forecasting purposes. Adjusted
Revenue Growth is defined as the year-over-year change in reported
net sales relative to the comparable period, excluding the impact
on net sales from currency exchange, commodity movements,
acquisitions, divestitures and other transactions. Not all
companies use identical calculations of Adjusted Revenue Growth,
therefore this presentation may not be comparable to other
similarly titled measures of other companies.
|
|
Three Months
Ended
March 31, 2023
|
|
|
Reported net sales %
change
|
15 %
|
Less: foreign currency
exchange and commodities
|
(4) %
|
Less:
acquisitions
|
4 %
|
Adjusted revenue
growth
|
15 %
|
Adjusted Operating
Income: Adjusted Operating Income is presented as a
supplemental measure of the Company's financial performance which
management believes is useful to investors in assessing the
Company's ongoing financial performance that, when reconciled to
the corresponding U.S. GAAP measure, provides improved
comparability between periods through the exclusion of certain
items that management believes are not indicative of the Company's
core operating performance and which may obscure underlying
business results and trends. Our management utilizes Adjusted
Operating Income in its financial decision making process, to
evaluate performance of the Company and for internal reporting,
planning and forecasting purposes. Management also utilizes
Adjusted Operating Income as the key performance measure of segment
income or loss and for planning and forecasting purposes to
allocate resources to our segments, as management also believes
this measure is most reflective of the operational profitability or
loss of our operating segments. Adjusted Operating Income is
defined as net income before interest expense, other income
(expense), net, income tax (expense) benefit, equity income (loss),
net of tax, amortization, restructuring and other special items.
Not all companies use identical calculations of Adjusted Operating
Income, therefore this presentation may not be comparable to other
similarly titled measures of other companies. Operating income
margin represents Operating income as a percentage of net sales,
and Adjusted Operating Income margin represents Adjusted Operating
Income as a percentage of net sales.
|
Consolidated
Adjusted Operating Income
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2023
|
|
2022
|
|
($ in
millions)
|
|
$
|
|
Margin
|
|
$
|
|
Margin
|
Net income attributable
to Aptiv
|
$
162
|
|
|
|
$
89
|
|
|
Interest
expense
|
67
|
|
|
|
43
|
|
|
Other expense,
net
|
1
|
|
|
|
39
|
|
|
Income tax
expense
|
34
|
|
|
|
21
|
|
|
Equity loss, net of
tax
|
82
|
|
|
|
63
|
|
|
Net income
attributable to noncontrolling interest
|
3
|
|
|
|
1
|
|
|
Net loss attributable
to redeemable noncontrolling interest
|
(1)
|
|
|
|
—
|
|
|
Operating
income
|
$
348
|
|
7.2 %
|
|
$
256
|
|
6.1 %
|
Amortization
|
59
|
|
|
|
37
|
|
|
Restructuring
|
11
|
|
|
|
22
|
|
|
Other acquisition and
portfolio project costs
|
14
|
|
|
|
9
|
|
|
Compensation expense
related to acquisitions
|
5
|
|
|
|
—
|
|
|
Adjusted operating
income
|
$
437
|
|
9.1 %
|
|
$
324
|
|
7.8 %
|
Segment Adjusted
Operating Income
|
|
|
|
|
|
(in
millions)
|
|
|
|
|
|
Three Months Ended
March 31, 2023
|
Signal and Power
Solutions
|
|
Advanced Safety
and User
Experience
|
|
Total
|
Operating
income
|
$
319
|
|
$
29
|
|
$
348
|
Amortization
|
36
|
|
23
|
|
59
|
Restructuring
|
7
|
|
4
|
|
11
|
Other acquisition and
portfolio project costs
|
12
|
|
2
|
|
14
|
Compensation expense
related to acquisitions
|
—
|
|
5
|
|
5
|
Adjusted operating
income
|
$
374
|
|
$
63
|
|
$
437
|
|
|
|
|
|
|
Depreciation and
amortization (a)
|
$
149
|
|
$
67
|
|
$
216
|
|
|
|
|
|
|
Three Months Ended
March 31, 2022
|
Signal and Power
Solutions
|
|
Advanced Safety
and User
Experience
|
|
Total
|
Operating income
(loss)
|
$
257
|
|
$
(1)
|
|
$
256
|
Amortization
|
35
|
|
2
|
|
37
|
Restructuring
|
9
|
|
13
|
|
22
|
Other acquisition and
portfolio project costs
|
7
|
|
2
|
|
9
|
Adjusted operating
income
|
$
308
|
|
$
16
|
|
$
324
|
|
|
|
|
|
|
Depreciation and
amortization (a)
|
$
146
|
|
$
45
|
|
$
191
|
|
|
(a)
|
Includes asset
impairments.
|
Adjusted EBITDA:
Adjusted EBITDA is presented as a supplemental measure of the
Company's financial performance which management believes is useful
to investors in assessing the Company's ongoing financial
performance that, when reconciled to the corresponding U.S. GAAP
measure, provides improved comparability between periods through
the exclusion of certain items that management believes are not
indicative of the Company's core operating performance and which
may obscure underlying business results and trends. Our management
utilizes Adjusted EBITDA in its financial decision making process,
to evaluate performance of the Company and for internal reporting,
planning and forecasting purposes. Adjusted EBITDA is defined as
net income before depreciation and amortization (including asset
impairments), interest expense, income tax (expense) benefit, other
income (expense), net, equity income (loss), net of tax,
restructuring and other special items. Not all companies use
identical calculations of Adjusted EBITDA, therefore this
presentation may not be comparable to other similarly titled
measures of other companies.
|
|
Three Months Ended
March 31,
|
|
2023
|
|
2022
|
|
(in
millions)
|
Net income attributable
to Aptiv
|
$
162
|
|
$
89
|
Interest
expense
|
67
|
|
43
|
Income tax
expense
|
34
|
|
21
|
Net income
attributable to noncontrolling interest
|
3
|
|
1
|
Net loss attributable
to redeemable noncontrolling interest
|
(1)
|
|
—
|
Depreciation and
amortization
|
216
|
|
191
|
EBITDA
|
$
481
|
|
$
345
|
Other expense,
net
|
1
|
|
39
|
Equity loss, net of
tax
|
82
|
|
63
|
Restructuring
|
11
|
|
22
|
Other acquisition and
portfolio project costs
|
14
|
|
9
|
Compensation expense
related to acquisitions
|
5
|
|
—
|
Adjusted
EBITDA
|
$
594
|
|
$
478
|
Adjusted Net Income
and Adjusted Net Income Per Share: Adjusted Net Income and
Adjusted Net Income Per Share, which are non-GAAP measures, are
presented as supplemental measures of the Company's financial
performance which management believes are useful to investors in
assessing the Company's ongoing financial performance that, when
reconciled to the corresponding U.S. GAAP measure, provide improved
comparability between periods through the exclusion of certain
items that management believes are not indicative of the Company's
core operating performance and which may obscure underlying
business results and trends. Management utilizes Adjusted Net
Income and Adjusted Net Income Per Share in its financial decision
making process, to evaluate performance of the Company and for
internal reporting, planning and forecasting purposes. Adjusted Net
Income is defined as net income attributable to Aptiv before
amortization, restructuring and other special items, including the
tax impact thereon. Adjusted Net Income Per Share is defined as
Adjusted Net Income divided by the Adjusted Weighted Average Number
of Diluted Shares Outstanding, as reconciled below, for the period.
Not all companies use identical calculations of Adjusted Net Income
and Adjusted Net Income Per Share, therefore this presentation may
not be comparable to other similarly titled measures of other
companies.
|
|
Three Months Ended
March 31,
|
|
2023
|
|
2022
|
|
(in millions, except
per share amounts)
|
Net income attributable
to ordinary shareholders
|
$
146
|
|
$
73
|
Mandatory convertible
preferred share dividends
|
16
|
|
16
|
Net income attributable
to Aptiv
|
162
|
|
89
|
Adjusting
items:
|
|
|
|
Amortization
|
59
|
|
37
|
Restructuring
|
11
|
|
22
|
Other acquisition and
portfolio project costs
|
14
|
|
9
|
Compensation expense
related to acquisitions
|
5
|
|
—
|
Impairment of equity
investments without readily determinable fair value
|
18
|
|
—
|
Loss on change in fair
value of publicly traded equity securities
|
3
|
|
32
|
Tax impact of
adjusting items (a)
|
(14)
|
|
(9)
|
Adjusted net income
attributable to Aptiv
|
$
258
|
|
$
180
|
|
|
|
|
Adjusted weighted
average number of diluted shares outstanding (b)
|
283.54
|
|
283.53
|
Diluted net income per
share attributable to ordinary shareholders
|
$
0.54
|
|
$
0.27
|
Adjusted net income per
share
|
$
0.91
|
|
$
0.63
|
|
|
(a)
|
Represents the income
tax impacts of the adjustments made for amortization, restructuring
and other special items by calculating the income tax impact of
these items using the appropriate tax rate for the jurisdiction
where the charges were incurred.
|
(b)
|
In June 2020, the
Company issued $1,150 million in aggregate liquidation preference
of 5.50% Mandatory Convertible Preferred Shares (the "MCPS") and
received proceeds of $1,115 million, after deducting expenses and
the underwriters' discount of $35 million. Dividends on the MCPS
are payable on a cumulative basis at an annual rate of 5.50% on the
liquidation preference of $100 per share. Unless earlier converted,
each share of MCPS will automatically convert on June 15, 2023 into
between 1.0754 and 1.3173 shares of Aptiv's ordinary shares,
subject to further anti-dilution adjustments. For purposes of
calculating Adjusted Net Income Per Share, the Company has excluded
the anticipated MCPS cash dividends and assumed the "if-converted"
method of share dilution (the incremental ordinary shares deemed
outstanding applying the "if-converted" method of calculating share
dilution are referred to as the "Weighted average MCPS Converted
Shares" in the following table). The Adjusted Weighted Average
Number of Diluted Shares Outstanding calculated below, assumes the
conversion of all 11.5 million MCPS and issuance of the underlying
ordinary shares applying the "if-converted" method on a weighted
average outstanding basis for all periods subsequent to issuance of
the MCPS. We believe that using the "if-converted" method provides
additional insight to investors on the potential impact of the MCPS
once they are converted into ordinary shares no later than June 15,
2023.
|
Adjusted Weighted
Average Number of Diluted Shares Outstanding:
|
|
|
|
|
Three Months Ended
March 31,
|
|
2023
|
|
2022
|
|
(in
millions)
|
Weighted average number
of diluted shares outstanding
|
271.17
|
|
271.16
|
Weighted average MCPS
Converted Shares
|
12.37
|
|
12.37
|
Adjusted weighted
average number of diluted shares outstanding
|
283.54
|
|
283.53
|
Cash Flow Before
Financing: Cash Flow Before Financing is presented as a
supplemental measure of the Company's liquidity which is consistent
with the basis and manner in which management presents financial
information for the purpose of making internal operating decisions,
evaluating its liquidity and determining appropriate capital
allocation strategies. Management believes this measure is useful
to investors to understand how the Company's core operating
activities generate and use cash. Cash Flow Before Financing is
defined as cash provided by (used in) operating activities plus
cash provided by (used in) investing activities, adjusted for the
purchase price of business acquisitions and other transactions, the
cost of significant technology investments and net proceeds from
the divestiture of discontinued operations and other significant
businesses. Not all companies use identical calculations of Cash
Flow Before Financing, therefore this presentation may not be
comparable to other similarly titled measures of other companies.
The calculation of Cash Flow Before Financing does not reflect cash
used to service debt, pay dividends or repurchase shares and,
therefore, does not necessarily reflect funds available for
investment or other discretionary uses.
|
|
Three Months Ended
March 31,
|
|
2023
|
|
2022
|
|
(in
millions)
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
164
|
|
$
90
|
Adjustments to
reconcile net income to net cash used in operating
activities:
|
|
|
|
Depreciation and
amortization
|
216
|
|
191
|
Restructuring expense,
net of cash paid
|
(24)
|
|
7
|
Working
capital
|
(348)
|
|
(567)
|
Pension
contributions
|
(8)
|
|
(4)
|
Other, net
|
(9)
|
|
81
|
Net cash used in
operating activities
|
(9)
|
|
(202)
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Capital
expenditures
|
(269)
|
|
(247)
|
Cost of business
acquisitions and other transactions, net of cash
acquired
|
(38)
|
|
(220)
|
Proceeds from sale of
technology investments
|
—
|
|
2
|
Cost of technology
investments
|
(1)
|
|
(1)
|
Settlement of
derivatives
|
(1)
|
|
(1)
|
Other, net
|
—
|
|
2
|
Net cash used in
investing activities
|
(309)
|
|
(465)
|
|
|
|
|
Adjusting
items:
|
|
|
|
Adjustment for cost of
business acquisitions and other transactions, net of cash
acquired
|
38
|
|
220
|
Cash flow before
financing
|
$
(280)
|
|
$
(447)
|
Financial
Guidance: The reconciliation of the forward-looking non-GAAP
financial measures provided in the
Company's financial guidance to the most comparable forward-looking
GAAP measure is as follows:
|
|
|
Estimated Full
Year
|
|
2023
(1)
|
|
($ in
millions)
|
Adjusted Operating
Income
|
$
|
|
Margin
(2)
|
Net income attributable
to Aptiv
|
$
830
|
|
|
Interest
expense
|
235
|
|
|
Other income,
net
|
(15)
|
|
|
Income tax
expense
|
195
|
|
|
Equity loss, net of
tax
|
300
|
|
|
Net income
attributable to noncontrolling interest (3)
|
15
|
|
|
Operating
income
|
$
1,560
|
|
8.2 %
|
Amortization
|
230
|
|
|
Restructuring
|
110
|
|
|
Other acquisition and
portfolio project costs
|
65
|
|
|
Compensation expense
related to acquisitions
|
35
|
|
|
Adjusted operating
income
|
$
2,000
|
|
10.5 %
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
Net income attributable
to Aptiv
|
$
830
|
|
|
Interest
expense
|
235
|
|
|
Income tax
expense
|
195
|
|
|
Net income
attributable to noncontrolling interest (3)
|
15
|
|
|
Depreciation and
amortization
|
895
|
|
|
EBITDA
|
$
2,170
|
|
11.4 %
|
Other income,
net
|
(15)
|
|
|
Equity loss, net of
tax
|
300
|
|
|
Restructuring
|
110
|
|
|
Other acquisition and
portfolio project costs
|
65
|
|
|
Compensation expense
related to acquisitions
|
35
|
|
|
Adjusted
EBITDA
|
$
2,665
|
|
14.0 %
|
|
|
(1)
|
Prepared at the
estimated mid-point of the Company's financial guidance
range.
|
(2)
|
Represents operating
income, Adjusted Operating Income, EBITDA and Adjusted EBITDA,
respectively, as a percentage of estimated net sales.
|
(3)
|
Includes portion
attributable to redeemable noncontrolling interest.
|
|
Estimated Full
Year
|
|
2023
(1)
|
Adjusted Net Income
Per Share
|
($ and shares in millions,
except per share amounts)
|
Net income attributable
to ordinary shareholders
|
$
800
|
Mandatory convertible
preferred share dividends
|
30
|
Net income attributable
to Aptiv
|
830
|
Adjusting
items:
|
|
Amortization
|
230
|
Restructuring
|
110
|
Other acquisition and
portfolio project costs
|
65
|
Compensation expense
related to acquisitions
|
35
|
Tax impact of
adjusting items
|
(60)
|
Adjusted net income
attributable to Aptiv
|
$
1,210
|
|
|
Adjusted weighted
average number of diluted shares outstanding
|
284.28
|
Diluted net income per
share attributable to ordinary shareholders
|
$
2.81
|
Adjusted net income per
share
|
$
4.25
|
|
|
(1)
|
Prepared at the
estimated mid-point of the Company's financial guidance
range.
|
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SOURCE Aptiv PLC