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Autoliv hosts Investor Day - reiterates financial targets
Autoliv is providing world class life-saving solutions for mobility and society while transforming its operations for the new age of electrification and autonomous driving, as well as digitalization and automation throughout the whole value chain.
"We are optimizing our operations for a more effective and cost-efficient structure to best serve our customers and to build an even more competitive position" said Mikael Bratt , President, and CEO of Autoliv. "At the Investor Day, we will outline how continued changes in safety regulations and ratings drive development of new products supporting continued growth in safety content per vehicle. Combined with our strong global market positions, this will drive our sales and profit growth for many years to come. We will also demonstrate how we will take operational excellence to the next level, which will support our journey towards our financial targets and continued shareholder value creation" continued Mikael Bratt .
Autoliv reiterates its growth targets. For the years 2022-2024, we expect to grow organically* by around 4 percentage points more than light vehicle production (LVP) growth per year, on average. The growth trend is on track to significantly exceed LVP +4pp per year for the period, partly due to price increases to offset recent years high-cost inflation. The Company estimates that, also when adjusting for these price increases, it will meet or exceed the growth target for the period 2022-2024.
The Company also reiterates its long-term growth target beyond 2024, where it aims to grow sales organically by 4-6% per year, over time. This is based on growth coming from safety content per vehicle, LVP and from Mobility Safety Solutions.
Autoliv reiterates its medium-term target of a 12% adjusted operating margin*. This relies on the continued implementation of our structural and strategic initiatives, including automation, digitalization and footprint optimization, together with the conditions that the business environment is a stable global LVP of at least 85 million and that headwinds from inflation do not have a greater net negative impact on our operating margin than they had in 2021 (offset through price compensations or declining raw material prices).
Autoliv reiterates its aim for a cash conversion* (operating cash flow less capex, net vs. net income) of at least 80%.
The Company maintains its target for a leverage ratio* (net debt to adjusted EBITDA) of around 1x, with a range of 0.5x to 1.5x.
At the Investor Day, the Autoliv will outline its plan to deliver on its targets for sustainability, growth and profitability. This will include discussing our capital efficiency program, which focuses on the efficient management of receivables, inventories and payables.
Combined with the execution of our strategic plan, this should lead to a strong cashflow generation. This should provide for significant shareholder value creation, while maintaining financial leverage commensurate with a strong investment grade credit rating. The current stock repurchase program authorizes the Company to repurchase up to $1.5 billion or up to 17 million common shares (whichever comes first), between January 2022 and the end of 2024. Under the program Autoliv has currently repurchased 2.3 million shares for a total of $194 million .
The investor day is today at 12.00 p.m. EDT at the Autoliv Tech Centre in Auburn Hills, Michigan , USA. The event will be webcasted live between 12.00 p.m. and around 3 p.m. EDT . The webcast can be accessed via the Autoliv webpage
A replay of the webcast will be available on our website Autoliv webpage shortly after the conclusion of the event and will remain available for a period of two years.
Investors & Analysts: Anders Trapp , Tel +46 (0)8 587 206 71
Investors & Analysts: Henrik Kaar , Tel +46 (0)8 587 206 14
Media: Gabriella Ekelund , Tel +46 (70) 612 64 24
* The forward-looking non-U.S. GAAP financial measures above are provided on a non-U.S. GAAP basis. Autoliv has not provided a U.S. GAAP reconciliation of these measures because items that impact these measures, such as costs and gains related to capacity alignments and antitrust matters, cannot be reasonably predicted or determined. As a result, such reconciliation is not available without unreasonable efforts and Autoliv is unable to determine the probable significance of the unavailable information. See our quarterly report on Form 10-Q filed with the SEC on April 21, 2023 for definitions of these non-GAAP measures.
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