Solid Operating Performance
Aptiv PLC (NYSE: APTV), a global technology company focused on
making mobility safer, greener and more connected, today reported
first quarter 2024 U.S. GAAP earnings of $0.79 per diluted share.
Excluding special items, first quarter earnings totaled $1.16 per
diluted share.
First Quarter Financial Highlights
Include:
- U.S. GAAP revenue of $4.9 billion, an increase of 2%
- Revenue increased 2% adjusted for currency exchange and
commodity movements; growth over market of 3% based on AWM1 of
(1)%
- U.S. GAAP net income of $218 million, diluted earnings per
share of $0.79
- Excluding special items, diluted earnings per share of
$1.16
- U.S. GAAP operating income margin of 8.5%
- Adjusted Operating Income margin of 11.1%, Adjusted
Operating Income of $544 million; Adjusted EBITDA margin of 14.7%;
Adjusted EBITDA of $720 million
- Generated $244 million of cash from operations
- Returned $600 million to shareholders through share
repurchases
“Aptiv delivered solid results in the first quarter with 200
basis points of margin expansion year-over-year and a return to
growth above market, despite a slowdown in electrification in North
America and Europe and persistent labor and material cost
headwinds,” said Kevin Clark, chairman and chief executive officer.
“We secured significant new business awards totaling nearly $13
billion, including our first full system Gen 6 ADAS award and first
power electronics win for the global market. While our revised
full-year outlook reflects a more conservative growth forecast,
primarily driven by reduced customer schedules, we will continue to
benefit from both our portfolio of leading technologies and our
relentless focus on cost optimization to drive outperformance
through the back half of the year. Overall, we remain confident in
our ability to deliver value to shareholders through innovation,
profitable growth, strong cash flow generation and disciplined
capital deployment.”
1
Represents global vehicle production
weighted to the geographic regions in which the Company generates
its revenue (“AWM”).
First Quarter 2024 Results
For the three months ended March 31, 2024, the Company reported
U.S. GAAP revenue of $4.9 billion, an increase of 2% from the prior
year period. Adjusted for currency exchange and commodity
movements, revenue increased by 2% in the first quarter. This
reflects growth of 7% in Asia, which includes 9% in China, and 2%
in North America, partially offset by declines of 1% in Europe and
9% in South America, our smallest region.
The Company reported first quarter 2024 U.S. GAAP net income of
$218 million and earnings of $0.79 per diluted share, compared to
$146 million and $0.54 per diluted share in the prior year period.
First quarter Adjusted Net Income, a non-GAAP financial measure
defined below, totaled $318 million, or earnings of $1.16 per
diluted share, compared to $258 million, or $0.91 per diluted
share, in the prior year period.
First quarter Adjusted Operating Income, a non-GAAP financial
measure defined below, was $544 million, compared to $437 million
in the prior year period. Adjusted Operating Income margin was
11.1%, compared to 9.1% in the prior year period, primarily
reflecting improved operating performance, including the benefits
of cost reduction initiatives, and increased volumes. Depreciation
and amortization expense totaled $230 million, an increase from
$216 million in the prior year period.
Interest expense for the first quarter totaled $65 million
compared to $67 million in the prior year period.
Tax expense in the first quarter of 2024, which includes
unfavorable impacts from the enacted OECD Pillar Two Framework, was
$76 million, resulting in an effective tax rate of approximately
21%. Tax expense in the first quarter of 2023 was $34 million,
resulting in an effective tax rate of approximately 12%.
The Company generated net cash flow from operating activities of
$244 million in the first quarter, compared to net cash flow used
in operating activities of $9 million in the prior year period. As
of March 31, 2024, the Company had cash and cash equivalents of
$0.9 billion and total available liquidity of $3.4 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 2024, the Company repurchased 7.3
million shares for $600 million, leaving approximately $1.0 billion
available for future share repurchases. All repurchased shares were
retired.
Motional Funding and Ownership Restructuring
Transactions
In April 2024, Aptiv and Hyundai Motor Group (“Hyundai”) entered
into an agreement to restructure Aptiv’s ownership interest in
Motional, AD LLC (“Motional”) and for Hyundai to provide additional
funding to Motional, eliminating any requirements for additional
future funding from Aptiv. These transactions are anticipated to
result in the reduction of Aptiv’s common equity interest from 50%
as of March 31, 2024 to approximately 15%, and are subject to
regulatory approvals and customary closing conditions.
Full Year 2024 Outlook
The Company’s full year 2024 financial guidance is as
follows:
(in millions, except per share
amounts)
Full Year 2024
Net sales
$20,850 - $21,450
Adjusted EBITDA
$3,150 - $3,300
Adjusted EBITDA margin
15.1% - 15.4%
Adjusted operating income
$2,425 - $2,575
Adjusted operating income margin
11.6% - 12.0%
Adjusted net income per share (1)
$5.80 - $6.30
Cash flow from operations
$2,350
Capital expenditures
$1,000
Adjusted effective tax rate
~17.5%
(1) The Company’s full year 2024 financial
guidance includes approximately $0.90 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 9764963. 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 created by the
conflict between Ukraine and Russia, and its impacts to the
European and global economies and our operations in each country;
uncertainties created by the conflicts in the Middle East and their
impacts on global economies; 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; future significant public health crises; 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,
2024
2023
(in millions, except per share
amounts)
Net sales
$
4,901
$
4,818
Operating expenses:
Cost of sales
4,023
4,058
Selling, general and administrative
366
342
Amortization
54
59
Restructuring
39
11
Total operating expenses
4,482
4,470
Operating income
419
348
Interest expense
(65
)
(67
)
Other income (expense), net
15
(1
)
Income before income taxes and equity
loss
369
280
Income tax expense
(76
)
(34
)
Income before equity loss
293
246
Equity loss, net of tax
(69
)
(82
)
Net income
224
164
Net income attributable to noncontrolling
interest
6
3
Net loss attributable to redeemable
noncontrolling interest
—
(1
)
Net income attributable to Aptiv
218
162
Mandatory convertible preferred share
dividends
—
(16
)
Net income attributable to ordinary
shareholders
$
218
$
146
Diluted net income per share:
Diluted net income per share attributable
to ordinary shareholders
$
0.79
$
0.54
Weighted average number of diluted shares
outstanding
275.31
271.17
APTIV PLC
CONDENSED CONSOLIDATED BALANCE
SHEETS
March 31, 2024
December 31,
2023
(Unaudited)
(in millions)
ASSETS
Current assets:
Cash and cash equivalents
$
941
$
1,640
Accounts receivable, net
3,652
3,546
Inventories
2,371
2,365
Other current assets
727
696
Total current assets
7,691
8,247
Long-term assets:
Property, net
3,764
3,785
Operating lease right-of-use assets
530
540
Investments in affiliates
1,363
1,443
Intangible assets, net
2,326
2,399
Goodwill
5,110
5,151
Other long-term assets
2,860
2,862
Total long-term assets
15,953
16,180
Total assets
$
23,644
$
24,427
LIABILITIES, REDEEMABLE NONCONTROLLING
INTEREST AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt
$
1,487
$
9
Accounts payable
2,893
3,151
Accrued liabilities
1,576
1,648
Total current liabilities
5,956
4,808
Long-term liabilities:
Long-term debt
4,721
6,204
Pension benefit obligations
418
417
Long-term operating lease liabilities
442
453
Other long-term liabilities
688
701
Total long-term liabilities
6,269
7,775
Total liabilities
12,225
12,583
Commitments and contingencies
Redeemable noncontrolling interest
97
99
Total Aptiv shareholders’ equity
11,120
11,548
Noncontrolling interest
202
197
Total shareholders’ equity
11,322
11,745
Total liabilities, redeemable
noncontrolling interest and shareholders’ equity
$
23,644
$
24,427
APTIV PLC
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended March
31,
2024
2023
(in millions)
Cash flows from operating activities:
Net income
$
224
$
164
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation and amortization
230
216
Restructuring expense, net of cash
paid
(36
)
(24
)
Deferred income taxes
32
(7
)
Loss from equity method investments, net
of dividends received
76
82
Other, net
42
33
Changes in operating assets and
liabilities:
Accounts receivable, net
(106
)
(131
)
Inventories
(6
)
(144
)
Accounts payable
(179
)
(73
)
Other, net
(26
)
(117
)
Pension contributions
(7
)
(8
)
Net cash provided by (used in) operating
activities
244
(9
)
Cash flows from investing activities:
Capital expenditures
(265
)
(269
)
Cost of business acquisitions and other
transactions, net of cash acquired
—
(38
)
Cost of technology investments
(40
)
(1
)
Settlement of derivatives
—
(1
)
Net cash used in investing activities
(305
)
(309
)
Cash flows from financing activities:
Decrease in other short and long-term
debt, net
(6
)
(8
)
Repurchase of ordinary shares
(600
)
(68
)
Distribution of mandatory convertible
preferred share cash dividends
—
(16
)
Taxes withheld and paid on employees’
restricted share awards
(20
)
(30
)
Net cash used in financing activities
(626
)
(122
)
Effect of exchange rate fluctuations on
cash, cash equivalents and restricted cash
(12
)
2
Decrease in cash, cash equivalents and
restricted cash
(699
)
(438
)
Cash, cash equivalents and restricted cash
at beginning of the period
1,640
1,555
Cash, cash equivalents and restricted cash
at end of the period
$
941
$
1,117
Reconciliation of cash, cash
equivalents and restricted cash and cash classified as assets held
for sale
March 31,
2024
2023
(in millions)
Cash, cash equivalents and restricted
cash
$
941
$
1,100
Cash classified as assets held for
sale
—
17
Total cash, cash equivalents and
restricted cash
$
941
$
1,117
APTIV PLC
FOOTNOTES
(Unaudited)
1. Segment Summary
Three Months Ended March
31,
2024
2023
%
(in millions)
Net Sales
Signal and Power Solutions
$
3,487
$
3,464
1
%
Advanced Safety and User Experience
1,429
1,366
5
%
Eliminations and Other (a)
(15
)
(12
)
Net Sales
$
4,901
$
4,818
Adjusted Operating
Income
Signal and Power Solutions
$
389
$
374
4
%
Advanced Safety and User Experience
155
63
146
%
Adjusted Operating Income
$
544
$
437
(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, 2024 and 2023:
Three Months Ended March
31,
2024
2023
(in millions, except per share
amounts)
Weighted average ordinary shares
outstanding, basic
275.19
271.01
Dilutive shares related to RSUs
0.12
0.16
Weighted average ordinary shares
outstanding, including dilutive shares
275.31
271.17
Net income per share attributable to
ordinary shareholders:
Basic
$
0.79
$
0.54
Diluted
$
0.79
$
0.54
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,
2024
Reported net sales % change
2
%
Less: foreign currency exchange and
commodities
—
%
Adjusted revenue growth
2
%
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,
2024
2023
($ in millions)
$
Margin
$
Margin
Net income attributable to Aptiv
$
218
$
162
Interest expense
65
67
Other (income) expense, net
(15
)
1
Income tax expense
76
34
Equity loss, net of tax
69
82
Net income attributable to noncontrolling
interest
6
3
Net loss attributable to redeemable
noncontrolling interest
—
(1
)
Operating income
$
419
8.5
%
$
348
7.2
%
Amortization
54
59
Restructuring
39
11
Other acquisition and portfolio project
costs
28
14
Compensation expense related to
acquisitions
4
5
Adjusted operating income
$
544
11.1
%
$
437
9.1
%
Segment Adjusted Operating
Income
(in millions)
Three Months Ended March 31,
2024
Signal and Power
Solutions
Advanced Safety and User
Experience
Total
Operating income
$
317
$
102
$
419
Amortization
31
23
54
Restructuring
22
17
39
Other acquisition and portfolio project
costs
19
9
28
Compensation expense related to
acquisitions
—
4
4
Adjusted operating income
$
389
$
155
$
544
Depreciation and amortization (a)
$
161
$
69
$
230
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
(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,
2024
2023
(in millions)
Net income attributable to Aptiv
$
218
$
162
Interest expense
65
67
Income tax expense
76
34
Net income attributable to noncontrolling
interest
6
3
Net loss attributable to redeemable
noncontrolling interest
—
(1
)
Depreciation and amortization
230
216
EBITDA
$
595
$
481
Other (income) expense, net
(15
)
1
Equity loss, net of tax
69
82
Restructuring
39
11
Other acquisition and portfolio project
costs
28
14
Compensation expense related to
acquisitions
4
5
Adjusted EBITDA
$
720
$
594
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,
2024
2023
(in millions, except per share
amounts)
Net income attributable to ordinary
shareholders
$
218
$
146
Mandatory convertible preferred share
dividends
—
16
Net income attributable to Aptiv
218
162
Adjusting items:
Amortization
54
59
Restructuring
39
11
Other acquisition and portfolio project
costs
28
14
Compensation expense related to
acquisitions
4
5
Impairment of equity investments without
readily determinable fair value
—
18
Loss on change in fair value of publicly
traded equity securities
1
3
Tax impact of adjusting items (a)
(26
)
(14
)
Adjusted net income attributable to
Aptiv
$
318
$
258
Adjusted weighted average number of
diluted shares outstanding (b)
275.31
283.54
Diluted net income per share attributable
to ordinary shareholders
$
0.79
$
0.54
Adjusted net income per share
$
1.16
$
0.91
(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. Each share of MCPS automatically converted
on June 15, 2023 into 1.0754 Aptiv ordinary shares. Dividends on
the MCPS were payable on a cumulative basis at an annual rate of
5.50% on the liquidation preference of $100 per share. Prior to the
conversion of the MCPS into ordinary shares in June 2023, for
purposes of calculating Adjusted Net Income Per Share, the Company
has excluded the 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 at the later of the beginning
of the period or the time of issuance, and resulting 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 impact of
the MCPS upon their conversion.
Adjusted Weighted
Average Number of Diluted Shares Outstanding:
Three Months Ended March
31,
2024
2023
(in millions)
Weighted average number of diluted shares
outstanding
275.31
271.17
Weighted average MCPS Converted Shares
—
12.37
Adjusted weighted average number of
diluted shares outstanding
275.31
283.54
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,
2024
2023
(in millions)
Cash flows from operating activities:
Net income
$
224
$
164
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation and amortization
230
216
Restructuring expense, net of cash
paid
(36
)
(24
)
Working capital
(291
)
(348
)
Pension contributions
(7
)
(8
)
Other, net
124
(9
)
Net cash provided by (used in) operating
activities
244
(9
)
Cash flows from investing activities:
Capital expenditures
(265
)
(269
)
Cost of business acquisitions and other
transactions, net of cash acquired
—
(38
)
Cost of technology investments
(40
)
(1
)
Settlement of derivatives
—
(1
)
Net cash used in investing activities
(305
)
(309
)
Adjusting items:
Adjustment for cost of business
acquisitions and other transactions, net of cash acquired
—
38
Adjustment for cost of significant
technology investments
40
—
Cash flow before financing
$
(21
)
$
(280
)
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
2024 (a)
($ in millions)
Adjusted
Operating Income
$
Margin (b)
Net income attributable to Aptiv
$
1,240
Interest expense
250
Other income, net
(50
)
Income tax expense
325
Equity loss, net of tax
245
Net income attributable to noncontrolling
interest (c)
30
Operating income
$
2,040
9.6
%
Amortization
220
Restructuring
160
Other acquisition and portfolio project
costs
55
Compensation expense related to
acquisitions
25
Adjusted operating income
$
2,500
11.8
%
Adjusted
EBITDA
Net income attributable to Aptiv
$
1,240
Interest expense
250
Income tax expense
325
Net income attributable to noncontrolling
interest (c)
30
Depreciation and amortization
945
EBITDA
$
2,790
13.2
%
Other income, net
(50
)
Equity loss, net of tax
245
Restructuring
160
Other acquisition and portfolio project
costs
55
Compensation expense related to
acquisitions
25
Adjusted EBITDA
$
3,225
15.2
%
(a)
Prepared at the estimated mid-point of the
Company’s financial guidance range.
(b)
Represents operating income, Adjusted
Operating Income, EBITDA and Adjusted EBITDA, respectively, as a
percentage of estimated net sales.
(c)
Includes portion attributable to
redeemable noncontrolling interest.
Estimated Full Year
2024 (a)
Adjusted Net
Income Per Share
($ and shares in millions,
except per share amounts)
Net income attributable to Aptiv
$
1,240
Adjusting items:
Amortization
220
Restructuring
160
Other acquisition and portfolio project
costs
55
Compensation expense related to
acquisitions
25
Tax impact of adjusting items
(75
)
Adjusted net income attributable to
Aptiv
$
1,625
Adjusted weighted average number of
diluted shares outstanding
268.50
Diluted net income per share attributable
to ordinary shareholders
$
4.60
Adjusted net income per share
$
6.05
(a)
Prepared at the estimated mid-point of the
Company’s financial guidance range.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240502223561/en/
Investor Contact: Jane Wu +1.617.603.7941 jane.wu@aptiv.com
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