STOCKHOLM (Reuters) - Sweden's Autoliv ALIVsdb.STALV.N, the world's largest producer of airbags and seatbelts, reported higher than expected quarterly earnings on Friday as it returned to profit in the wake of a coronavirus-linked plunge in car production.
The rival of ZF TRW and Joyson Safety Systems also said it expected to further outperform global light vehicle production during a “very busy” fourth quarter for order intake, sending its Swedish-listed shares up 3.5% by 1100 GMT.
“The worst demand decline on record in the second quarter was followed by a faster than expected recovery in the third quarter, with its challenges of managing the supply chain,” CEO Mikael Bratt said in a statement.
Autoliv reported third-quarter operating profit of $175 million compared with $154 million in the year-ago quarter and a mean forecast of $163 million, based on a poll of analysts published by the company.
The firm slammed the brakes on spending and moved to bolster its cash position as the pandemic and lockdowns saw auto production shuttered across much of Europe and North America, but it still slumped to a loss in the second quarter.
Since then, production and demand have staged a recovery, though worries have grown amid a renewed and vigorous spread of the disease in large swathes of Europe and the United States. Bratt said the company was keeping a high level of flexibility.
“We’ve had a quarter characterised by a strong recovery and heading into the fourth quarter, we see a continued trend along those lines in these first few weeks,” he told Reuters.
“I would say that we are cautiously optimistic, but well aware of a lingering high level of uncertainty, and we are ready to make any changes we may need to do.”
In its first stab at full-year guidance since the initial peak of the pandemic, it said it expected a 13% decline in like-for-like sales and an adjusted operating margin of 6%, down from 9.1% in 2019.
Reporting by Niklas Pollard, Editing by Helena Soderpalm, Hugh Lawson and Jan Harvey
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