• Fri. Sep 23rd, 2022

Auto parts maker Aptiv joins rivals in flagging earnings hit by China lockdowns

ByRandall B. Phelps

May 28, 2022

Aptiv has a “strong presence” in Shanghai, a city that has been under strict lockdowns due to rising COVID-19 cases.

Auto parts supplier Aptiv Plc warned of a hit to its current-quarter earnings on Thursday, joining rivals who also reported lower auto production due to ongoing COVID-19 lockdowns in China, l one of the largest automotive markets.

“We believe the second quarter will be significantly impacted by COVID-related lockdowns in China,” Chief Financial Officer Joseph Massaro said on a call with analysts.

Aptiv has a “strong presence” in Shanghai, a city that has been under strict lockdowns due to rising COVID-19 cases.

Last week, Canadian auto parts maker Magna International Inc lowered its full-year profit forecast, in part because of the shutdowns. BorgWarner Inc also warned of a hit to second-quarter revenue.

Aptiv, however, stuck to its full-year guidance after reporting better-than-expected first-quarter results as demand for its electrical components and software from automakers shifted billions to manufacturing. of electric vehicles.

“We and most others expected APTV to reduce its guidelines in the middle

elevated macro pressures…yet APTV surprised on the upside by maintaining its guidance,” said Credit Suisse analyst Dan Levy.

CFRA analyst Garrett Nelson, however, expects Aptiv to lower its guidance in subsequent quarters due to declining margins.

Aptiv’s net income fell 73.8% to $73 million, or 27 cents per share for the three months ended March 31, from a year earlier, in part due to raw material prices and supply chain disruptions.

On an adjusted basis, the Dublin, Ireland-based company posted earnings of 63 cents per share, beating expectations of 61 cents.

Net sales rose about 4% to $4.18 billion, beating analysts’ estimates of $4.04 billion.

(Reporting by Nathan Gomes in Bengaluru; Editing by Rashmi Aich)

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