BorgWarner cuts outlook as Europe worsens
DETROIT (Reuters) - BorgWarner Inc (BWA.N), which makes automotive turbochargers and emissions systems, cut its 2012 revenue and profit outlook on Wednesday due to the economic downturn in Europe, where the company drew more than half its annual revenue last year.
In posting its third-quarter results, the auto parts supplier said it now expects 2012 sales to be flat or to rise by 1 percent. Previously, it had forecast growth of between 4 percent and 6 percent.
"Our outlook for Europe, our largest market, has deteriorated due to the general economic slowdown across the continent and its impact on the automotive industry," Chief Executive Tim Manganello said in a statement.
BorgWarner cut its per-share earnings outlook to between $4.90 and $5.00 for this year. That still represents record earnings for the company, but falls short of its previous forecast for as much as $5.25 a share.
Analysts, on average, had expected a 2012 profit of $5.10 per share, according to Thomson Reuters I/B/E/S.
In the third quarter, BorgWarner's adjusted profit was $1.19 a share, in line with expectations. Net income attributable to BorgWarner was $101.1 million, or 85 cents per share, down from $142 million, or $1.15 per share, a year earlier.
Revenue fell 5.4 percent to $1.7 billion, falling short of estimates of about $1.9 billion.
The company's new outlook suggests that fourth-quarter earnings will be as much as 15 percent below estimates, Baird Equity Research analyst David Leiker said. (Reporting By Deepa Seetharaman; Editing by Peter Galloway)
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