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Share Name | Share Symbol | Market | Type |
---|---|---|---|
BorgWarner Inc | NYSE:BWA | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-0.11 | -0.29% | 37.51 | 38.225 | 37.31 | 38.00 | 1,094,070 | 20:41:15 |
(Mark One)
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þ
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Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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For the quarterly period ended
March 31, 2016
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o
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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For the transition period from
to
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Delaware
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13-3404508
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State or other jurisdiction of
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(I.R.S. Employer
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Incorporation or organization
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Identification No.)
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|
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3850 Hamlin Road, Auburn Hills, Michigan
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48326
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
|
þ
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Accelerated filer
|
o
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Non-accelerated filer
|
o
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Smaller reporting company
|
o
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Page No.
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(in millions)
|
March 31,
2016
|
|
December 31,
2015 |
||||
ASSETS
|
|
|
|
||||
Cash
|
$
|
392.3
|
|
|
$
|
577.7
|
|
Receivables, net
|
1,861.2
|
|
|
1,665.0
|
|
||
Inventories, net
|
756.3
|
|
|
723.6
|
|
||
Prepayments and other current assets
|
172.6
|
|
|
168.9
|
|
||
Total current assets
|
3,182.4
|
|
|
3,135.2
|
|
||
|
|
|
|
|
|
||
Property, plant and equipment, net
|
2,498.9
|
|
|
2,448.1
|
|
||
Investments and other long-term receivables
|
487.7
|
|
|
460.9
|
|
||
Goodwill
|
1,774.2
|
|
|
1,757.7
|
|
||
Other intangible assets, net
|
539.0
|
|
|
543.8
|
|
||
Other non-current assets
|
458.5
|
|
|
480.0
|
|
||
Total assets
|
$
|
8,940.7
|
|
|
$
|
8,825.7
|
|
|
|
|
|
|
|
||
LIABILITIES AND EQUITY
|
|
|
|
|
|
||
Notes payable and other short-term debt
|
$
|
466.5
|
|
|
$
|
441.4
|
|
Accounts payable and accrued expenses
|
1,819.4
|
|
|
1,866.4
|
|
||
Income taxes payable
|
24.5
|
|
|
49.4
|
|
||
Total current liabilities
|
2,310.4
|
|
|
2,357.2
|
|
||
|
|
|
|
|
|
||
Long-term debt
|
2,131.9
|
|
|
2,108.9
|
|
||
|
|
|
|
||||
Other non-current liabilities:
|
|
|
|
|
|
||
Retirement-related liabilities
|
313.6
|
|
|
312.9
|
|
||
Other
|
423.7
|
|
|
415.2
|
|
||
Total other non-current liabilities
|
737.3
|
|
|
728.1
|
|
||
|
|
|
|
|
|
||
Common stock
|
2.5
|
|
|
2.5
|
|
||
Capital in excess of par value
|
1,085.3
|
|
|
1,109.7
|
|
||
Retained earnings
|
4,346.0
|
|
|
4,210.1
|
|
||
Accumulated other comprehensive loss
|
(540.8
|
)
|
|
(610.2
|
)
|
||
Common stock held in treasury
|
(1,199.8
|
)
|
|
(1,158.4
|
)
|
||
Total BorgWarner Inc. stockholders’ equity
|
3,693.2
|
|
|
3,553.7
|
|
||
Noncontrolling interest
|
67.9
|
|
|
77.8
|
|
||
Total equity
|
3,761.1
|
|
|
3,631.5
|
|
||
Total liabilities and equity
|
$
|
8,940.7
|
|
|
$
|
8,825.7
|
|
|
Three Months Ended
March 31,
|
||||||
(in millions, except share and per share amounts)
|
2016
|
|
2015
|
||||
Net sales
|
$
|
2,268.6
|
|
|
$
|
1,984.2
|
|
Cost of sales
|
1,804.3
|
|
|
1,555.2
|
|
||
Gross profit
|
464.3
|
|
|
429.0
|
|
||
|
|
|
|
|
|||
Selling, general and administrative expenses
|
188.4
|
|
|
168.2
|
|
||
Other expense, net
|
11.7
|
|
|
1.2
|
|
||
Operating income
|
264.2
|
|
|
259.6
|
|
||
|
|
|
|
|
|||
Equity in affiliates’ earnings, net of tax
|
(9.1
|
)
|
|
(8.5
|
)
|
||
Interest income
|
(1.6
|
)
|
|
(1.7
|
)
|
||
Interest expense and finance charges
|
21.3
|
|
|
10.0
|
|
||
Earnings before income taxes and noncontrolling interest
|
253.6
|
|
|
259.8
|
|
||
|
|
|
|
|
|||
Provision for income taxes
|
80.4
|
|
|
72.1
|
|
||
Net earnings
|
173.2
|
|
|
187.7
|
|
||
Net earnings attributable to the noncontrolling interest, net of tax
|
9.1
|
|
|
8.8
|
|
||
Net earnings attributable to BorgWarner Inc.
|
$
|
164.1
|
|
|
$
|
178.9
|
|
|
|
|
|
||||
Earnings per share — basic
|
$
|
0.75
|
|
|
$
|
0.79
|
|
|
|
|
|
||||
Earnings per share — diluted
|
$
|
0.75
|
|
|
$
|
0.79
|
|
|
|
|
|
||||
Weighted average shares outstanding (thousands):
|
|
|
|
||||
Basic
|
217,388
|
|
|
225,796
|
|
||
Diluted
|
218,137
|
|
|
227,088
|
|
||
|
|
|
|
||||
Dividends declared per share
|
$
|
0.13
|
|
|
$
|
0.13
|
|
|
Three Months Ended
March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Net earnings attributable to BorgWarner Inc.
|
$
|
164.1
|
|
|
$
|
178.9
|
|
|
|
|
|
||||
Other comprehensive income (loss)
|
|
|
|
||||
Foreign currency translation adjustments
|
68.4
|
|
|
(249.8
|
)
|
||
Hedge instruments*
|
1.7
|
|
|
4.2
|
|
||
Defined benefit postretirement plans*
|
(0.2
|
)
|
|
12.3
|
|
||
Other*
|
(0.5
|
)
|
|
—
|
|
||
Total other comprehensive income (loss) attributable to BorgWarner Inc.
|
69.4
|
|
|
(233.3
|
)
|
||
|
|
|
|
||||
Comprehensive income (loss) attributable to BorgWarner Inc.
|
233.5
|
|
|
(54.4
|
)
|
||
Comprehensive income attributable to the noncontrolling interest
|
1.6
|
|
|
0.1
|
|
||
Comprehensive income (loss)
|
$
|
235.1
|
|
|
$
|
(54.3
|
)
|
*
|
Net of income taxes.
|
|
Three Months Ended
March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
OPERATING
|
|
|
|
||||
Net earnings
|
$
|
173.2
|
|
|
$
|
187.7
|
|
Adjustments to reconcile net earnings to net cash flows from operations:
|
|
|
|
||||
Depreciation and amortization
|
94.4
|
|
|
77.1
|
|
||
Restructuring expense, net of cash paid
|
0.1
|
|
|
8.1
|
|
||
Gain on previously held equity interest
|
—
|
|
|
(10.8
|
)
|
||
Stock-based compensation expense
|
9.6
|
|
|
10.9
|
|
||
Deferred income tax provision
|
23.9
|
|
|
10.4
|
|
||
Equity in affiliates’ earnings, net of dividends received, and other
|
(15.7
|
)
|
|
(9.8
|
)
|
||
Net earnings adjusted for non-cash charges to operations
|
285.5
|
|
|
273.6
|
|
||
Changes in assets and liabilities:
|
|
|
|
|
|
||
Receivables
|
(155.8
|
)
|
|
(202.1
|
)
|
||
Inventories
|
(17.9
|
)
|
|
(30.6
|
)
|
||
Prepayments and other current assets
|
0.5
|
|
|
(9.8
|
)
|
||
Accounts payable and accrued expenses
|
(43.6
|
)
|
|
32.5
|
|
||
Income taxes payable
|
(25.8
|
)
|
|
(7.8
|
)
|
||
Other non-current assets and liabilities
|
(8.5
|
)
|
|
(23.1
|
)
|
||
Net cash provided by operating activities
|
34.4
|
|
|
32.7
|
|
||
|
|
|
|
|
|
||
INVESTING
|
|
|
|
|
|
||
Capital expenditures, including tooling outlays
|
(104.3
|
)
|
|
(140.0
|
)
|
||
Payment for business acquired, net of cash acquired
|
—
|
|
|
(12.6
|
)
|
||
Proceeds from asset disposals and other
|
1.1
|
|
|
0.8
|
|
||
Net cash used in investing activities
|
(103.2
|
)
|
|
(151.8
|
)
|
||
|
|
|
|
|
|
||
FINANCING
|
|
|
|
|
|
||
Net increase (decrease) in notes payable
|
19.7
|
|
|
(512.3
|
)
|
||
Additions to long-term debt, net of debt issuance costs
|
—
|
|
|
1,012.8
|
|
||
Repayments of long-term debt, including current portion
|
(8.7
|
)
|
|
(3.1
|
)
|
||
Payments for purchase of treasury stock
|
(79.5
|
)
|
|
(33.7
|
)
|
||
Payments for stock-based compensation items
|
(7.6
|
)
|
|
(1.6
|
)
|
||
Dividends paid to BorgWarner stockholders
|
(28.2
|
)
|
|
(29.4
|
)
|
||
Dividends paid to noncontrolling stockholders
|
(20.5
|
)
|
|
(15.9
|
)
|
||
Net cash (used in) provided by financing activities
|
(124.8
|
)
|
|
416.8
|
|
||
Effect of exchange rate changes on cash
|
8.2
|
|
|
(60.0
|
)
|
||
Net (decrease) increase in cash
|
(185.4
|
)
|
|
237.7
|
|
||
Cash at beginning of year
|
577.7
|
|
|
797.8
|
|
||
Cash at end of period
|
$
|
392.3
|
|
|
$
|
1,035.5
|
|
|
|
|
|
||||
SUPPLEMENTAL CASH FLOW INFORMATION
|
|
|
|
|
|||
Cash paid during the period for:
|
|
|
|
|
|||
Interest
|
$
|
29.3
|
|
|
$
|
12.8
|
|
Income taxes, net of refunds
|
$
|
84.4
|
|
|
$
|
50.0
|
|
|
Three Months Ended
March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Gross R&D expenditures
|
$
|
100.6
|
|
|
$
|
92.4
|
|
Customer reimbursements
|
(15.3
|
)
|
|
(17.0
|
)
|
||
Net R&D expenditures
|
$
|
85.3
|
|
|
$
|
75.4
|
|
|
Three Months Ended
March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Restructuring expense
|
$
|
6.4
|
|
|
$
|
12.1
|
|
Merger and acquisition expense
|
5.8
|
|
|
—
|
|
||
Gain on previously held equity interest
|
—
|
|
|
(10.8
|
)
|
||
Other income
|
(0.5
|
)
|
|
(0.1
|
)
|
||
Other expense, net
|
$
|
11.7
|
|
|
$
|
1.2
|
|
|
March 31,
|
|
December 31,
|
||||
(in millions)
|
2016
|
|
2015
|
||||
Raw material and supplies
|
$
|
439.0
|
|
|
$
|
412.9
|
|
Work in progress
|
108.1
|
|
|
102.5
|
|
||
Finished goods
|
223.6
|
|
|
222.4
|
|
||
FIFO inventories
|
770.7
|
|
|
737.8
|
|
||
LIFO reserve
|
(14.4
|
)
|
|
(14.2
|
)
|
||
Inventories, net
|
$
|
756.3
|
|
|
$
|
723.6
|
|
|
March 31,
|
|
December 31,
|
||||
(in millions)
|
2016
|
|
2015
|
||||
Land, land use rights and buildings
|
$
|
814.4
|
|
|
$
|
779.9
|
|
Machinery and equipment
|
2,303.1
|
|
|
2,154.3
|
|
||
Capital leases
|
7.5
|
|
|
7.2
|
|
||
Construction in progress
|
365.6
|
|
|
386.4
|
|
||
Total property, plant and equipment, gross
|
3,490.6
|
|
|
3,327.8
|
|
||
Less: accumulated depreciation
|
(1,148.5
|
)
|
|
(1,036.8
|
)
|
||
Property, plant and equipment, net, excluding tooling
|
2,342.1
|
|
|
2,291.0
|
|
||
Tooling, net of amortization
|
156.8
|
|
|
157.1
|
|
||
Property, plant and equipment, net
|
$
|
2,498.9
|
|
|
$
|
2,448.1
|
|
(in millions)
|
2016
|
|
2015
|
||||
Beginning balance, January 1
|
$
|
107.9
|
|
|
$
|
132.0
|
|
Provisions
|
24.6
|
|
|
6.3
|
|
||
Payments
|
(19.0
|
)
|
|
(8.2
|
)
|
||
Translation adjustment
|
2.9
|
|
|
(19.3
|
)
|
||
Ending balance, March 31
|
$
|
116.4
|
|
|
$
|
110.8
|
|
|
March 31,
|
|
December 31,
|
||||
(in millions)
|
2016
|
|
2015
|
||||
Accounts payable and accrued expenses
|
$
|
72.5
|
|
|
$
|
70.6
|
|
Other non-current liabilities
|
43.9
|
|
|
37.3
|
|
||
Total product warranty liability
|
$
|
116.4
|
|
|
$
|
107.9
|
|
|
March 31,
|
|
December 31,
|
||||
(in millions)
|
2016
|
|
2015
|
||||
Short-term debt
|
|
|
|
|
|
||
Short-term borrowings
|
$
|
303.2
|
|
|
$
|
280.7
|
|
|
|
|
|
|
|
||
Long-term debt
|
|
|
|
|
|
||
5.75% Senior notes due 11/01/16 ($150 million par value)
|
$
|
149.8
|
|
|
$
|
149.8
|
|
8.00% Senior notes due 10/01/19 ($134 million par value)
|
133.8
|
|
|
133.8
|
|
||
4.625% Senior notes due 09/15/20 ($250 million par value)
|
247.6
|
|
|
247.4
|
|
||
1.80% Senior notes due 11/7/22 (€500 million par value)
|
562.9
|
|
|
536.8
|
|
||
3.375% Senior notes due 03/15/25 ($500 million par value)
|
495.1
|
|
|
495.1
|
|
||
7.125% Senior notes due 02/15/29 ($121 million par value)
|
118.7
|
|
|
118.7
|
|
||
4.375% Senior notes due 03/15/45 ($500 million par value)
|
493.2
|
|
|
493.0
|
|
||
Term loan facilities and other
|
81.2
|
|
|
89.7
|
|
||
Impact of derivatives on debt
|
12.9
|
|
|
5.3
|
|
||
Total long-term debt
|
2,295.2
|
|
|
2,269.6
|
|
||
Less: current portion
|
163.3
|
|
|
160.7
|
|
||
Long-term debt, net of current portion
|
$
|
2,131.9
|
|
|
$
|
2,108.9
|
|
Level 1:
|
Observable inputs such as quoted prices for identical assets or liabilities in active markets;
|
Level 2:
|
Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and
|
Level 3:
|
Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
|
A.
|
Market approach:
Prices and other relevant information generated by market transactions involving identical or comparable assets, liabilities or a group of assets or liabilities, such as a business.
|
B.
|
Cost approach:
Amount that would be required to replace the service capacity of an asset (replacement cost).
|
C.
|
Income approach:
Techniques to convert future amounts to a single present amount based upon market expectations (including present value techniques, option-pricing and excess earnings models).
|
|
|
|
Basis of fair value measurements
|
|
|
||||||||||||
(in millions)
|
Balance at
March 31, 2016
|
|
Quoted prices in active markets for identical items
(Level 1)
|
|
Significant other observable inputs
(Level 2)
|
|
Significant unobservable inputs
(Level 3)
|
|
Valuation technique
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
|
$
|
3.3
|
|
|
$
|
—
|
|
|
$
|
3.3
|
|
|
$
|
—
|
|
|
A
|
Interest rate swap contracts
|
$
|
6.0
|
|
|
$
|
—
|
|
|
$
|
6.0
|
|
|
$
|
—
|
|
|
A
|
Other long-term receivables (insurance settlement agreement note receivable)
|
$
|
81.3
|
|
|
$
|
—
|
|
|
$
|
81.3
|
|
|
$
|
—
|
|
|
C
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
|
$
|
5.9
|
|
|
$
|
—
|
|
|
$
|
5.9
|
|
|
$
|
—
|
|
|
A
|
Commodity contracts
|
$
|
6.4
|
|
|
$
|
—
|
|
|
$
|
6.4
|
|
|
$
|
—
|
|
|
A
|
|
|
|
Basis of fair value measurements
|
|
|
||||||||||||
(in millions)
|
Balance at
December 31, 2015
|
|
Quoted prices in active markets for identical items
(Level 1)
|
|
Significant other observable inputs
(Level 2)
|
|
Significant unobservable inputs
(Level 3)
|
|
Valuation
technique
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
|
$
|
2.7
|
|
|
$
|
—
|
|
|
$
|
2.7
|
|
|
$
|
—
|
|
|
A
|
Other long-term receivables (insurance settlement agreement note receivable)
|
$
|
81.2
|
|
|
$
|
—
|
|
|
$
|
81.2
|
|
|
$
|
—
|
|
|
C
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
|
$
|
8.7
|
|
|
$
|
—
|
|
|
$
|
8.7
|
|
|
$
|
—
|
|
|
A
|
Commodity contracts
|
$
|
10.4
|
|
|
$
|
—
|
|
|
$
|
10.4
|
|
|
$
|
—
|
|
|
A
|
Interest rate swap contracts
|
$
|
2.7
|
|
|
$
|
—
|
|
|
$
|
2.7
|
|
|
$
|
—
|
|
|
A
|
|
Commodity derivative contracts
|
||||||||
Commodity
|
Volume hedged March 31, 2016
|
|
Volume hedged December 31, 2015
|
|
Units of measure
|
|
Duration
|
||
Copper
|
4,525.6
|
|
|
6,273.2
|
|
|
Metric Tons
|
|
Dec -16
|
|
Interest rate swap contracts
|
||||||
(in millions)
|
Hedge Type
|
|
Notional Amount
|
|
Duration
|
||
Fixed to floating
|
Fair value
|
|
$
|
250.0
|
|
|
Sept - 20
|
Fixed to floating
|
Fair value
|
|
$
|
134.0
|
|
|
Oct - 19
|
|
|
Assets
|
|
Liabilities
|
||||||||||||||||
(in millions)
|
|
Location
|
|
March 31,
2016
|
|
December 31, 2015
|
|
Location
|
|
March 31,
2016
|
|
December 31, 2015
|
||||||||
Foreign currency
|
|
Prepayments and other current assets
|
|
$
|
3.3
|
|
|
$
|
2.7
|
|
|
Accounts payable and accrued expenses
|
|
$
|
5.9
|
|
|
$
|
8.7
|
|
Commodity
|
|
Prepayments and other current assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Accounts payable and accrued expenses
|
|
$
|
6.4
|
|
|
$
|
10.4
|
|
Interest rate swaps
|
|
Other non-current assets
|
|
$
|
6.0
|
|
|
$
|
—
|
|
|
Accounts payable and accrued expenses
|
|
$
|
—
|
|
|
$
|
2.7
|
|
(in millions)
|
|
Deferred gain (loss) in AOCI at
|
|
Gain (loss) expected to be reclassified to income in one year or less
|
||||||||
Contract Type
|
|
March 31, 2016
|
|
December 31, 2015
|
|
|||||||
Foreign currency
|
|
$
|
0.6
|
|
|
$
|
(0.1
|
)
|
|
$
|
0.6
|
|
Commodity
|
|
(0.8
|
)
|
|
(2.1
|
)
|
|
(0.8
|
)
|
|||
Net investment hedges
|
|
12.3
|
|
|
12.2
|
|
|
—
|
|
|||
Foreign currency denominated debt designated as a net investment hedge
|
|
(26.0
|
)
|
|
0.1
|
|
|
—
|
|
|||
Total
|
|
$
|
(13.9
|
)
|
|
$
|
10.1
|
|
|
$
|
(0.2
|
)
|
|
|
|
|
Gain (loss) reclassified
from AOCI to income
(effective portion)
|
|
|
|
Gain (loss)
recognized in income
(ineffective portion)
|
||||||||||||
(in millions)
|
|
|
|
Three Months Ended
|
|
|
|
Three Months Ended
|
||||||||||||
Contract Type
|
|
Location
|
|
March 31,
2016
|
|
March 31,
2015
|
|
Location
|
|
March 31,
2016
|
|
March 31,
2015
|
||||||||
Foreign currency
|
|
Sales
|
|
$
|
—
|
|
|
$
|
(0.3
|
)
|
|
SG&A expense
|
|
$
|
—
|
|
|
$
|
(0.3
|
)
|
Foreign currency
|
|
Cost of goods sold
|
|
$
|
(0.5
|
)
|
|
$
|
1.5
|
|
|
SG&A expense
|
|
$
|
0.2
|
|
|
$
|
0.1
|
|
Commodity
|
|
Cost of goods sold
|
|
$
|
(0.1
|
)
|
|
$
|
—
|
|
|
Cost of goods sold
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Pension benefits
|
|
Other postretirement
employee benefits
|
||||||||||||||||||||
(in millions)
|
|
2016
|
|
2015
|
|
|||||||||||||||||||
Three Months Ended March 31,
|
|
US
|
|
Non-US
|
|
US
|
|
Non-US
|
|
2016
|
|
2015
|
||||||||||||
Service cost
|
|
$
|
—
|
|
|
$
|
4.0
|
|
|
$
|
—
|
|
|
$
|
3.7
|
|
|
$
|
0.1
|
|
|
$
|
0.1
|
|
Interest cost
|
|
2.4
|
|
|
3.2
|
|
|
2.8
|
|
|
3.6
|
|
|
1.0
|
|
|
1.4
|
|
||||||
Expected return on plan assets
|
|
(3.7
|
)
|
|
(6.3
|
)
|
|
(4.3
|
)
|
|
(6.2
|
)
|
|
—
|
|
|
—
|
|
||||||
Amortization of unrecognized prior service credit
|
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(1.2
|
)
|
|
(1.4
|
)
|
||||||
Amortization of unrecognized loss
|
|
1.2
|
|
|
1.6
|
|
|
1.6
|
|
|
1.7
|
|
|
0.5
|
|
|
0.7
|
|
||||||
Net periodic benefit (income) cost
|
|
$
|
(0.3
|
)
|
|
$
|
2.5
|
|
|
$
|
(0.1
|
)
|
|
$
|
2.8
|
|
|
$
|
0.4
|
|
|
$
|
0.8
|
|
|
Shares under option
(thousands)
|
|
Weighted average exercise price
|
|
Weighted average remaining contractual life
(in years)
|
|
Aggregate intrinsic value
(in millions)
|
|||||
Outstanding and exercisable at December 31, 2015
|
1,267
|
|
|
$
|
16.59
|
|
|
0.9
|
|
$
|
33.7
|
|
Exercised
|
(165
|
)
|
|
$
|
16.81
|
|
|
|
|
|
||
Outstanding and exercisable at March 31, 2016
|
1,102
|
|
|
$
|
16.56
|
|
|
0.7
|
|
$
|
24.1
|
|
|
Shares subject to restriction
(thousands)
|
|
Weighted average price
|
|||
Nonvested at December 31, 2015
|
1,326
|
|
|
$
|
53.18
|
|
Granted
|
668
|
|
|
$
|
29.61
|
|
Vested
|
(493
|
)
|
|
$
|
46.06
|
|
Forfeited
|
(19
|
)
|
|
$
|
42.84
|
|
Nonvested at March 31, 2016
|
1,482
|
|
|
$
|
45.03
|
|
(in millions)
|
|
Foreign currency translation adjustments
|
|
Hedge instruments
|
|
Defined benefit postretirement plans
|
|
Other
|
|
Total
|
||||||||||
Beginning balance, December 31, 2015
|
|
$
|
(421.2
|
)
|
|
$
|
(2.0
|
)
|
|
$
|
(189.9
|
)
|
|
$
|
2.9
|
|
|
$
|
(610.2
|
)
|
Comprehensive income (loss) before reclassifications
|
|
68.4
|
|
|
1.5
|
|
|
(2.1
|
)
|
|
(0.5
|
)
|
|
67.3
|
|
|||||
Income taxes associated with comprehensive income (loss) before reclassifications
|
|
—
|
|
|
(0.4
|
)
|
|
0.9
|
|
|
—
|
|
|
0.5
|
|
|||||
Reclassification from accumulated other comprehensive loss
|
|
—
|
|
|
0.6
|
|
|
1.9
|
|
|
—
|
|
|
2.5
|
|
|||||
Income taxes reclassified into net earnings
|
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|
—
|
|
|
(0.9
|
)
|
|||||
Ending balance, March 31, 2016
|
|
$
|
(352.8
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(190.1
|
)
|
|
$
|
2.4
|
|
|
$
|
(540.8
|
)
|
(in millions)
|
|
Foreign currency translation adjustments
|
|
Hedge instruments
|
|
Defined benefit postretirement plans
|
|
Other
|
|
Total
|
||||||||||
Beginning balance, December 31, 2014
|
|
$
|
(160.7
|
)
|
|
$
|
1.7
|
|
|
$
|
(227.3
|
)
|
|
$
|
2.7
|
|
|
$
|
(383.6
|
)
|
Comprehensive income (loss) before reclassifications
|
|
(249.8
|
)
|
|
6.6
|
|
|
14.5
|
|
|
—
|
|
|
(228.7
|
)
|
|||||
Income taxes associated with comprehensive income (loss) before reclassifications
|
|
—
|
|
|
(1.6
|
)
|
|
(4.0
|
)
|
|
—
|
|
|
(5.6
|
)
|
|||||
Reclassification from accumulated other comprehensive loss
|
|
—
|
|
|
(1.2
|
)
|
|
2.4
|
|
|
—
|
|
|
1.2
|
|
|||||
Income taxes reclassified into net earnings
|
|
—
|
|
|
0.4
|
|
|
(0.6
|
)
|
|
—
|
|
|
(0.2
|
)
|
|||||
Ending balance, March 31, 2015
|
|
$
|
(410.5
|
)
|
|
$
|
5.9
|
|
|
$
|
(215.0
|
)
|
|
$
|
2.7
|
|
|
$
|
(616.9
|
)
|
|
March 31,
|
|
December 31,
|
||||
(in millions)
|
2016
|
|
2015
|
||||
Assets:
|
|
|
|
||||
Other non-current assets
|
$
|
106.0
|
|
|
$
|
108.5
|
|
Total insurance assets
|
$
|
106.0
|
|
|
$
|
108.5
|
|
Liabilities:
|
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
48.3
|
|
|
$
|
47.7
|
|
Other non-current liabilities
|
57.7
|
|
|
60.8
|
|
||
Total accrued liabilities
|
$
|
106.0
|
|
|
$
|
108.5
|
|
|
|
Severance Accruals
|
||||||||||
(in millions)
|
|
Drivetrain
|
|
Engine
|
|
Total
|
||||||
Balance at December 31, 2015
|
|
$
|
25.3
|
|
|
$
|
4.1
|
|
|
$
|
29.4
|
|
Provision
|
|
2.3
|
|
|
1.0
|
|
|
3.3
|
|
|||
Cash payments
|
|
(17.3
|
)
|
|
(2.3
|
)
|
|
(19.6
|
)
|
|||
Translation adjustment
|
|
0.7
|
|
|
0.2
|
|
|
0.9
|
|
|||
Balance at March 31, 2016
|
|
$
|
11.0
|
|
|
$
|
3.0
|
|
|
$
|
14.0
|
|
|
|
Severance Accruals
|
||||||||||
(in millions)
|
|
Drivetrain
|
|
Engine
|
|
Total
|
||||||
Balance at December 31, 2014
|
|
$
|
41.9
|
|
|
$
|
2.0
|
|
|
$
|
43.9
|
|
Provision
|
|
7.4
|
|
|
0.4
|
|
|
7.8
|
|
|||
Cash payments
|
|
(10.7
|
)
|
|
(0.9
|
)
|
|
(11.6
|
)
|
|||
Translation adjustment
|
|
(4.7
|
)
|
|
(0.2
|
)
|
|
(4.9
|
)
|
|||
Balance at March 31, 2015
|
|
$
|
33.9
|
|
|
$
|
1.3
|
|
|
$
|
35.2
|
|
|
Three Months Ended
March 31,
|
||||||
(in millions, except per share amounts)
|
2016
|
|
2015
|
||||
Basic earnings per share:
|
|
|
|
||||
Net earnings attributable to BorgWarner Inc.
|
$
|
164.1
|
|
|
$
|
178.9
|
|
Weighted average shares of common stock outstanding
|
217.388
|
|
|
225.796
|
|
||
Basic earnings per share of common stock
|
$
|
0.75
|
|
|
$
|
0.79
|
|
|
|
|
|
||||
Diluted earnings per share:
|
|
|
|
||||
Net earnings attributable to BorgWarner Inc.
|
$
|
164.1
|
|
|
$
|
178.9
|
|
|
|
|
|
||||
Weighted average shares of common stock outstanding
|
217.388
|
|
|
225.796
|
|
||
Effect of stock-based compensation
|
0.749
|
|
|
1.292
|
|
||
Weighted average shares of common stock outstanding including dilutive shares
|
218.137
|
|
|
227.088
|
|
||
Diluted earnings per share of common stock
|
$
|
0.75
|
|
|
$
|
0.79
|
|
|
Three Months Ended
March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Engine
|
$
|
1,399.2
|
|
|
$
|
1,380.9
|
|
Drivetrain
|
879.2
|
|
|
611.2
|
|
||
Inter-segment eliminations
|
(9.8
|
)
|
|
(7.9
|
)
|
||
Net sales
|
$
|
2,268.6
|
|
|
$
|
1,984.2
|
|
|
Three Months Ended
March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Engine
|
$
|
233.4
|
|
|
$
|
230.4
|
|
Drivetrain
|
83.8
|
|
|
71.0
|
|
||
Adjusted EBIT
|
317.2
|
|
|
301.4
|
|
||
Restructuring expense
|
6.4
|
|
|
12.1
|
|
||
Merger and acquisition expense
|
5.8
|
|
|
—
|
|
||
Gain on previously held equity interest
|
—
|
|
|
(10.8
|
)
|
||
Corporate, including equity in affiliates' earnings and stock-based compensation
|
31.7
|
|
|
32.0
|
|
||
Interest income
|
(1.6
|
)
|
|
(1.7
|
)
|
||
Interest expense and finance charges
|
21.3
|
|
|
10.0
|
|
||
Earnings before income taxes and noncontrolling interest
|
253.6
|
|
|
259.8
|
|
||
Provision for income taxes
|
80.4
|
|
|
72.1
|
|
||
Net earnings
|
173.2
|
|
|
187.7
|
|
||
Net earnings attributable to the noncontrolling interest, net of tax
|
9.1
|
|
|
8.8
|
|
||
Net earnings attributable to BorgWarner Inc.
|
$
|
164.1
|
|
|
$
|
178.9
|
|
(in millions)
|
March 31,
2016
|
|
December 31, 2015
|
||||
Engine
|
$
|
4,211.6
|
|
|
$
|
4,018.0
|
|
Drivetrain
|
3,740.8
|
|
|
3,685.1
|
|
||
Total
|
7,952.4
|
|
|
7,703.1
|
|
||
Corporate *
|
988.3
|
|
|
1,122.6
|
|
||
Total assets
|
$
|
8,940.7
|
|
|
$
|
8,825.7
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
Non-comparable items:
|
|
|
|
||||
Restructuring expense
|
$
|
(0.02
|
)
|
|
$
|
(0.05
|
)
|
Merger and acquisition expense
|
(0.03
|
)
|
|
—
|
|
||
Gain on previously held equity interest
|
—
|
|
|
0.05
|
|
||
Tax adjustments
|
—
|
|
|
0.01
|
|
||
Total impact of non-comparable items per share — diluted
|
$
|
(0.05
|
)
|
|
$
|
0.01
|
|
|
Three Months Ended
March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Engine
|
$
|
1,399.2
|
|
|
$
|
1,380.9
|
|
Drivetrain
|
879.2
|
|
|
611.2
|
|
||
Inter-segment eliminations
|
(9.8
|
)
|
|
(7.9
|
)
|
||
Net sales
|
$
|
2,268.6
|
|
|
$
|
1,984.2
|
|
|
Three Months Ended
March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Engine
|
$
|
233.4
|
|
|
$
|
230.4
|
|
Drivetrain
|
83.8
|
|
|
71.0
|
|
||
Adjusted EBIT
|
317.2
|
|
|
301.4
|
|
||
Restructuring expense
|
6.4
|
|
|
12.1
|
|
||
Merger and acquisition expense
|
5.8
|
|
|
—
|
|
||
Gain on previously held equity interest
|
—
|
|
|
(10.8
|
)
|
||
Corporate, including equity in affiliates' earnings and stock-based compensation
|
31.7
|
|
|
32.0
|
|
||
Interest income
|
(1.6
|
)
|
|
(1.7
|
)
|
||
Interest expense and finance charges
|
21.3
|
|
|
10.0
|
|
||
Earnings before income taxes and noncontrolling interest
|
253.6
|
|
|
259.8
|
|
||
Provision for income taxes
|
80.4
|
|
|
72.1
|
|
||
Net earnings
|
173.2
|
|
|
187.7
|
|
||
Net earnings attributable to the noncontrolling interest, net of tax
|
9.1
|
|
|
8.8
|
|
||
Net earnings attributable to BorgWarner Inc.
|
$
|
164.1
|
|
|
$
|
178.9
|
|
(in millions)
|
March 31,
2016
|
|
December 31, 2015
|
||||
Assets:
|
|
|
|
||||
Other non-current assets
|
$
|
106.0
|
|
|
$
|
108.5
|
|
Total insurance assets
|
$
|
106.0
|
|
|
$
|
108.5
|
|
Liabilities:
|
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
48.3
|
|
|
$
|
47.7
|
|
Other non-current liabilities
|
57.7
|
|
|
60.8
|
|
||
Total accrued liabilities
|
$
|
106.0
|
|
|
$
|
108.5
|
|
Item 1.
|
Legal Proceedings
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Issuer Purchases of Equity Securities
|
|||||||||||||
Period
|
|
Total number of shares purchased
|
|
Average price per share
|
|
Total number of shares purchased as part of publicly announced plans or programs
|
|
Maximum number of shares that may yet be purchased under the plans or programs
|
|||||
Month Ended January 31, 2016
|
|
|
|
|
|
|
|
|
|||||
Common Stock Repurchase Program
|
|
864,701
|
|
|
$
|
32.65
|
|
|
864,701
|
|
|
9,661,839
|
|
Employee transactions
|
|
369
|
|
|
$
|
44.61
|
|
|
—
|
|
|
|
|
Month Ended February 29, 2016
|
|
|
|
|
|
|
|
|
|||||
Common Stock Repurchase Program
|
|
783,287
|
|
|
$
|
30.63
|
|
|
783,287
|
|
|
8,878,552
|
|
Employee transactions
|
|
189,662
|
|
|
$
|
29.95
|
|
|
—
|
|
|
|
|
Month Ended March 31, 2016
|
|
|
|
|
|
|
|
|
|||||
Common Stock Repurchase Program
|
|
431,137
|
|
|
$
|
35.75
|
|
|
431,137
|
|
|
8,447,415
|
|
Employee transactions
|
|
457
|
|
|
$
|
37.15
|
|
|
—
|
|
|
|
Item 6.
|
Exhibits
|
|
|
|
|
|
Exhibit 3.1/4.1
|
|
Restated Certificate of Incorporation of the Company.*
|
|
|
|
|
|
Exhibit 3.2/4.2
|
|
Amended and Restated By-laws of the Company, as amended.*
|
|
|
|
|
|
Exhibit 10.1
|
|
Form of February 2016 RRG BorgWarner Inc. 2014 Stock Incentive Plan Performance Share Award Agreement.*
|
|
|
|
|
|
Exhibit 10.2
|
|
Form of February 2016 BorgWarner Inc. 2014 Stock Incentive Plan Performance Share Award Agreement.*
|
|
|
|
|
|
Exhibit 10.3
|
|
First Amendment to the BorgWarner 2014 Stock Incentive Plan (incorporated by reference to Appendix B to the Company's Definitive Proxy Statement filed March 18, 2015)
.
|
|
|
|
|
|
Exhibit 31.1
|
|
Rule 13a-14(a)/15d-14(a) Certification of the Principal Executive Officer.*
|
|
|
|
|
|
Exhibit 31.2
|
|
Rule 13a-14(a)/15d-14(a) Certification of the Principal Financial Officer.*
|
|
|
|
|
|
Exhibit 32.1
|
|
Section 1350 Certifications.*
|
|
|
|
|
|
Exhibit 101.INS
|
|
XBRL Instance Document.*
|
|
|
|
|
|
Exhibit 101.SCH
|
|
XBRL Taxonomy Extension Schema Document.*
|
|
|
|
|
|
Exhibit 101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.*
|
|
|
|
|
|
Exhibit 101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.*
|
|
|
|
|
|
Exhibit 101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.*
|
|
|
|
|
|
Exhibit 101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.*
|
|
|
|
|
|
|
|
|
BorgWarner Inc.
|
|
|
|
|
|
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
By
|
|
/s/ Steven G. Carlson
|
|
|
|
|
(Signature)
|
|
|
|
|
|
|
|
|
|
Steven G. Carlson
|
|
|
|
|
|
|
|
|
|
Vice President and Controller
|
|
|
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
|
1 Year BorgWarner Chart |
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