BorgWarner Inc. (BWA) reported a profit for the third quarter, mainly in the absence of a year-ago hefty goodwill impairment charge, but sales declined from last year. However, non-GAAP earnings per share fell year-over-year, yet beat the Street expectations. Following the news, shares of the company are currently down more than 6%.
Third-quarter net earnings attributable to the company were $17.2 million or $0.15 per share, compared with a loss of $130.4 million or $1.12 per share in the last year. Net earnings for the quarter were $20 million versus a loss of $128 million in 2008.
The company said its third-quarter 2008 results included a restructuring charge of $0.16 per share, a charge of $1.27 per share for a goodwill adjustment related to the BERU acquisition, a valuation adjustment for foreign tax credits of $0.12 per share, and a charge related to the outcome of retiree healthcare benefits litigation of $0.03 per share.
In addition, BorgWarner stated that the foreign currencies impact, primarily the lower Euro, lowered its third-quarter 2009 sales by around $50 million compared with the last year, and reduced earnings by about $3 million or $0.03 per share.
Non-GAAP earnings per share for the recent quarter fell sharply to $0.15 from $0.44 in the prior year. On average, 16 analysts polled by Thomson Reuters expected earnings per share of $0.10 for the quarter. Analysts' estimate typically excludes one-time items.
Net sales for the third quarter of 2009 decreased 22% to $1.03 billion from $1.32 billion in the year earlier period. Eleven analysts estimated revenues of $1.01 billion for the quarter. Excluding the negative impact of currency, the decline would have been about 18%, the company noted.
The company's engine segment group net sales dropped to $735.3 million from $974.1 million, and sales for Drivetrain Group declined 14.5% to $296.8 million from $347.2 million last year.
BorgWarner reported a third-quarter operating income of $27.5 million versus a loss of 103.9 million a year ago.
For the nine-month period, net loss attributable to the company was $25.7 million or $0.22 per share versus a net profit of $45.8 million or $0.39 per share in the first nine months of 2008.
For nine months, non-U.S. GAAP loss per share was $0.03 in comparison with a profit of $1.97 in the earlier period.
Net sales for the first nine months of 2009 totaled $2.76 billion, down 36.2% from $4.33 billion in the 2008 period. Excluding the negative impact of currency, the decrease would have been about 31%, the company reported.
Looking ahead to the fourth quarter, the company expects to report a profit, with production volumes incrementally higher than third quarter levels in North America. However, visibility in Europe remains limited due to uncertainty surrounding consumer demand, the impact of expiring government-sponsored incentive programs and other market dynamics, BorgWarner noted.
BWA is currently down more than 6% and trading at $30.46 on a volume of 646K shares on the NYSE.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.