DETROIT, July 26 BorgWarner Inc, a
supplier of automotive powertrain technology, reported lower net
income for the second quarter and cut its full-year earnings and
revenue outlook, citing the slowdown in the global economy.
Excluding one-time items, BorgWarner earned $1.36 per share.
This fell a penny short of the average Wall Street estimate of
$1.37, according to Thomson Reuters I/B/E/S.
The decline of the euro against the dollar during the
quarter cost BorgWarner 9 cents a share and lowered sales by
$135 million. Last year, Europe accounted for more than half of
"Our outlook for Europe and for commercial vehicle markets
around the world has been negatively impacted by the general
slowdown in the global economy," Chief Executive Tim Manganello
said in a statement.
The parts supplier now expects to earn between $5.05 and
$5.25 per share this year, down from its previous outlook of
between $5.35 and $5.65. Wall Street analysts, on average,
expect $5.38 a share this year.
BorgWarner also expects 2012 revenue to increase by 4 to 6
percent, including the effect of currency. Earlier, it projected
as much as 12 percent growth in sales. Analysts, on average,
expect annual revenue to be about $7.8 billion, roughly a 9
percent rise from 2011 levels.
The new revenue outlook is "a legitimate disappointment,"
said Citi analyst Itay Michaeli.
"The slowdown in revenue growth was worse than expected,
overshadowing strong margin performance in the quarter,"
The company reported net income fell to $121 million, or $1
per share, from $162 million, or $1.31 per share.
BorgWarner shares were up 6 cents at $62.19 on Thursday
morning on the New York Stock Exchange.