•

On December 8, 2020, Autoliv announced the appointment of Frédéric Lissalde as an independent member to its Board of Directors. Mr. Lissalde is President, Chief Executive Officer, and a member of the board of directors of BorgWarner Inc. Prior to joining BorgWarner in 1999, Mr. Lissalde held different positions at Valeo and ZF. Mr. Lissalde

holds a Masters of Engineering degree from ENSAM - Ecole Nationale Supérieure des Arts et Métiers - Paris, and an MBA from HEC Paris.

(Dollars in millions, except per share data)

Fourth quarter

Full year

(Unaudited)

2020

2019

2020

2019

Airbag and Other products¹⁾

$1,636.7

$1,443.6

$4,824.2

$5,676.3

Seatbelt products¹⁾

880.1

747.6

$2,623.2

$2,871.3

Total net sales

$2,516.8

$2,191.2

$7,447.4

$8,547.6

Cost of sales

(2,015.0)

(1,764.4)

$(6,200.5)

$(6,963.2)

Gross profit

$501.8

$426.8

$1,246.9

$1,584.4

Selling, general & administrative expenses

(105.5)

(98.7)

(389.2)

(398.9)

Research, development & engineering expenses, net

(83.3)

(82.0)

(375.5)

(405.5)

Amortization of intangibles

(2.5)

(2.9)

(10.0)

(11.5)

Other income (expense), net

(3.7)

(13.9)

(90.1)

(42.7)

Operating income

$306.8

$229.3

$382.1

$725.8

Income from equity method investments

1.3

0.4

2.3

2.0

Interest income

0.9

0.9

4.6

3.6

Interest expense

(19.7)

(16.9)

(73.0)

(69.5)

Other non-operating items, net

(11.4)

(4.0)

(24.8)

(13.5)

Income before income taxes

$277.9

$209.7

$291.2

$648.4

Income taxes

(89.0)

(53.8)

(102.9)

(185.6)

Net income

$188.9

$155.9

$188.3

$462.8

Less: Net income attributable to non-controlling interest

0.4

0.3

1.4

1.3

Net income attributable to controlling interest

$188.5

$155.6

$186.9

$461.5

Earnings per share^{2, 3)}

$2.15

$1.78

$2.14

$5.29

1) Including Corporate and other sales. 2) Assuming dilution when applicable and net of treasury shares. 3) Participating share awards with right to receive dividend equivalents are (under the two-class method) excluded from EPS calculation.

Dec 31

Sep 30

Jun 30

Mar 31

Dec 31

(Dollars in millions, unaudited)

2020

2020

2020

2020

2019

Assets

Cash & cash equivalents

$1,178.2

$1,476.5

$1,223.2

$907.2

$444.7

Receivables, net

1,821.6

1,615.7

1,179.5

1,428.1

1,626.7

Inventories, net

798.3

713.8

757.8

771.6

740.9

Other current assets

470.9

230.5

222.4

200.1

189.8

Total current assets

$4,269.0

$4,036.5

$3,382.9

$3,307.0

$3,002.1

Property, plant & equipment, net

1,869.1

1,779.1

1,753.1

1,749.5

1,815.7

Investments and other non-current assets

466.2

475.6

486.3

367.1

386.4

Operating leases right-of-use assets

140.8

137.3

150.0

148.5

156.8

Goodwill assets

1,398.1

1,389.6

1,385.0

1,382.4

1,387.9

Intangible assets, net

13.6

15.3

17.2

19.4

22.3

Total assets

$8,156.8

$7,833.4

$7,174.5

$6,973.9

$6,771.2

Liabilities and equity

Short-term debt¹⁾

$301.8

$1,025.5

$492.9

$318.8

$368.1

Accounts payable

1,253.9

912.4

615.7

862.5

950.6

Operating lease liabilities, current

37.3

35.9

36.7

35.9

37.8

Other current liabilities

1,553.9

1,247.5

1,006.7

1,009.0

1,053.7

Total current liabilities

$3,146.9

$3,221.3

$2,152.0

$2,226.2

$2,410.2

Long-term debt¹⁾

2,109.6

2,007.1

2,567.0

2,209.4

1,726.1

Pension liability

248.2

239.2

235.7

231.8

240.2

Operating lease liabilities, non-current

103.3

102.0

114.4

113.4

119.4

Other non-current liabilities

125.7

150.5

150.4

149.0

152.9

Total non-current liabilities

$2,586.8

$2,498.8

$3,067.5

$2,703.6

$2,238.6

Total parent shareholders’ equity

2,408.9

2,099.8

1,941.5

2,031.0

2,109.2

Non-controlling interest

14.2

13.5

13.5

13.1

13.2

Total equity

$2,423.1

$2,113.3

$1,955.0

$2,044.1

$2,122.4

Total liabilities and equity

$8,156.8

$7,833.4

$7,174.5

$6,973.9

$6,771.2

1) As of September 30, 2020, $600 million of the revolving credit facility loan was classified as short-term debt since it was repaid on October 2, 2020.

Fourth quarter

Full year

(Dollars in millions, unaudited)

2020

2019

2020

2019

Net income

$188.9

$155.9

$188.3

$462.8

Depreciation and amortization

102.8

90.5

370.9

350.6

Other, net¹⁾

63.9

(19.1)

13.2

(219.9)

Changes in operating assets and liabilities

113.3

85.0

276.5

47.2

Net cash provided by operating activities

$468.9

$312.3

$848.9

$640.7

Capital expenditures, net

(111.1)

(118.0)

(339.6)

(476.1)

Net cash used in investing activities

$(111.1)

$(118.0)

$(339.6)

$(476.1)

Net cash before financing²⁾

$357.8

$194.3

$509.3

$164.6

Net (decrease) in short-term debt

(42.2)

(54.7)

(239.9)

(364.1)

(Decrease) in short-term part of long-term debt³⁾

(722.5)

–

(722.5)

–

Net increase in long-term debt³⁾

86.5

–

1,177.1

243.5

Debt issuance costs

–

–

–

(0.3)

Dividends paid

–

(54.3)

(54.1)

(217.0)

Common stock options exercised

0.6

0.6

0.8

0.9

Dividend paid to non-controlling interests

(0.3)

–

(1.3)

(1.1)

Net cash (used in) provided by financing activities

$(677.9)

$(108.4)

$160.1

$(338.1)

Effect of exchange rate changes on cash

21.8

24.4

64.1

2.4

Increase (decrease) in cash and cash equivalents

$(298.3)

$110.3

$733.5

$(171.1)

Cash and cash equivalents at period-start

1,476.5

334.4

444.7

615.8

Cash and cash equivalents at period-end

$1,178.2

$444.7

$1,178.2

$444.7

1) Mainly related to EC antitrust payment in Q2 2019. 2) Non-U.S. GAAP measure comprised of "Net cash provided by operating activities" and "Net cash used in investing activities". See reconciliation table. 3) As of September 30, 2020, $600 million of the revolving credit facility loan was classified as short-term debt since it was repaid on October 2, 2020.

Dec 31

Sep 30

Jun 30

Mar 31

Dec 31

(Dollars in millions)

2020

2020

2020

2020

2019

Total current assets

$4,269.0

$4,036.5

$3,382.9

$3,307.0

$3,002.1

Total current liabilities

(3,146.9)

(3,221.3)

(2,152.0)

(2,226.2)

(2,410.2)

Working capital

$1,122.1

$815.2

$1,230.9

$1,080.8

$591.9

Cash and cash equivalents

(1,178.2)

(1,476.5)

(1,223.2)

(907.2)

(444.7)

Short-term debt

301.8

1,025.5

492.9

318.8

368.1

Derivative asset and liability, current

(22.6)

15.1

(2.6)

4.4

(4.2)

Dividends payable¹⁾

–

–

–

54.1

54.1

Operating working capital

$223.1

$379.3

$498.0

$550.9

$565.2

1) As of April 2, 2020, the dividend payable in Mar 31, 2020 was cancelled.

Dec 31

Sep 30

Jun 30

Mar 31

Dec 31

(Dollars in millions)

2020

2020

2020

2020

2019

Short-term debt

$301.8

$1,025.5

$492.9

$318.8

$368.1

Long-term debt

2,109.6

2,007.1

2,567.0

2,209.4

1,726.1

Total debt

$2,411.4

$3,032.6

$3,059.9

$2,528.2

$2,094.2

Cash & cash equivalents

(1,178.2)

(1,476.5)

(1,223.2)

(907.2)

(444.7)

Debt issuance cost/Debt-related derivatives, net

(19.0)

17.0

1.2

8.5

0.3

Net debt

$1,214.2

$1,573.1

$1,837.9

$1,629.5

$1,649.8

Dec 31

Dec 31

Dec 31

(Dollars in millions)

2018

2017

2016

Short-term debt

$620.7

$19.7

$216.3

Long-term debt

1,609.0

1,310.7

1,312.5

Total debt

$2,229.7

$1,330.4

$1,528.8

Cash & cash equivalents

(615.8)

(959.5)

(1,226.7)

Debt issuance cost/Debt-related derivatives, net

4.9

(2.5)

(3.4)

Net debt

$1,618.8

$368.4

$298.7

Dec 31

Sep 30

Dec 31

(Dollars in millions)

2020

2020

2019

Net debt¹⁾

$1,214.2

$1,573.1

$1,649.8

Pension liabilities

248.2

239.2

240.2

Debt per the Policy

$1,462.4

$1,812.3

$1,890.0

Net income²⁾

$188.3

$155.3

$462.8

Income taxes²⁾

102.9

67.6

185.6

Interest expense, net^{2, 3)}

68.4

65.6

65.9

Depreciation and amortization of intangibles²⁾

370.9

358.6

350.6

Antitrust related matters, capacity alignments and separation costs^{2, 4)}

99.5

107.8

48.6

EBITDA per the Policy (Adjusted EBITDA)

$830.0

$754.9

$1,113.5

Leverage ratio

1.8

2.4

1.7

1) Short- and long-term debt less cash and cash equivalents and debt-related derivatives. 2) Latest 12 months. 3) Interest expense including cost for extinguishment of debt, if any, less interest income. 4) No separation costs LTM Sep 30, 2020 and Dec 31, 2020.

Fourth quarter

Full year

(Dollars in millions)

2020

2019

2020

2019

Net income

$188.9

$155.9

$188.3

$462.8

Changes in operating assets and liabilities

113.3

85.0

276.5

47.2

Depreciation and amortization

102.8

90.5

370.9

350.6

Other, net¹⁾

63.9

(19.1)

13.2

(219.9)

Operating cash flow

$468.9

$312.3

$848.9

$640.7

EC antitrust payment

–

–

–

(203)

Operating cash flow excl antitrust

$468.9

$312.3

$848.9

$843.7

Capital expenditure, net

(111.1)

(118.0)

(339.6)

(476.1)

Free cash flow²⁾

$357.8

$194.3

$509.3

$164.6

Free cash flow excl antitrust payment³⁾

$357.8

$194.3

$509.3

$367.6

Net cash before financing

$357.8

$194.3

$509.3

$164.6

Cash conversion⁴⁾

189.4%

124.6%

270.5%

35.6%

Cash conversion excl antitrust⁵⁾

189.4%

124.6%

270.5%

79.4%

1) Mainly related to EC antitrust payment in Q2 2019. 2) Operating cash flow less Capital expenditures, net. 3) Operating cash flow excl EC antitrust payment less Capital expenditures, net. 4) Free cash flow relative to Net income. 5) Free cash flow excl EC antitrust payment relative to Net income.

Full year

Full year

Full year

(Dollars in millions)

2018¹⁾

2017¹⁾

2016¹⁾

Net income

$183.7

$303.0

$561.6

Changes in operating assets and liabilities

(229.3)

(0.3)

(77.8)

Depreciation and amortization

397.1

425.8

383.0

Goodwill impairment charges

–

234.2

–

Other, net⁴⁾

239.1

(26.8)

1.6

Operating cash flow

$590.6

$935.9

$868.4

Capital expenditure, net

(554.8)

(569.6)

(498.6)

Free cash flow²⁾

$35.8

$366.3

$369.8

Acquisitions of businesses and other, net

(72.9)

(127.7)

(227.4)

Net cash before financing

$(37.1)

$238.6

$142.4

Cash conversion³⁾

19.5%

120.9%

65.8%

1) Including Discontinued Operations. 2) Operating cash flow less Capital expenditures, net. 3) Free cash flow relative to Net income. 4) For full year 2018 including EC antitrust non-cash provision. 

Fourth quarter 2020

Fourth quarter 2019

(Dollars in millions, except per share data)

Reported
U.S. GAAP

Adjust-ments¹⁾

Non-U.S.
GAAP

Reported
U.S. GAAP

Adjust-ments¹⁾

Non-U.S.
GAAP

Operating income

$306.8

$4.6

$311.4

$229.3

$12.9

$242.2

Operating margin, %

12.2

0.2

12.4

10.5

0.6

11.1

Income before taxes

$277.9

$4.6

$282.5

$209.7

$12.9

$222.6

Net income attributable to controlling interest

$188.5

$3.4

$191.9

$155.6

$5.4

$161.0

Return on capital employed, %²⁾

33.7

(0.3)

33.4

24.3

1.2

25.5

Return on total equity, %³⁾

33.3

(0.6)

32.7

30.3

0.5

30.8

Earnings per share^{4, 5)}

$2.15

$0.04

$2.19

$1.78

$0.06

$1.84

1) Costs for capacity alignment and antitrust related matters. 2) Annualized operating income and income from equity method investments, relative to average capital employed. 3) Annualized income relative to average total equity. 4) Assuming dilution and net of treasury shares. 5) Participating share awards with right to receive dividend equivalents are (under the two-class method) excluded from the EPS calculation.

Full year 2020

Full year 2019

Reported
U.S. GAAP

Adjust-ments¹⁾

Non-U.S.
GAAP

Reported
U.S. GAAP

Adjust-ments¹⁾

Non-U.S.
GAAP

Operating income

$382.1

$99.5

481.6

$725.8

$48.6

$774.4

Operating margin, %

5.1

1.4

6.5

8.5

0.6

9.1

Income before taxes

$291.2

$99.5

$390.7

$648.4

$48.6

$697.0

Net income attributable to controlling interest

$186.9

$88.4

$275.3

$461.5

$38.0

$499.5

Capital employed

$3,637

$88

$3,725

$3,772

$38

$3,810

Return on capital employed, %²⁾

10.4

2.5

12.9

19.7

1.2

20.9

Return on total equity, %³⁾

8.8

3.9

12.7

23.1

1.7

24.8

Earnings per share^{4, 5)}

$2.14

$1.01

$3.15

$5.29

$0.43

$5.72

Total parent shareholders' equity per share

$27.56

$1.01

$28.57

$24.19

$0.43

$24.62

1) Costs for capacity alignment, antitrust related matters and in 2019 separation of our business segments. 2) Annualized operating income and income from equity method investments, relative to average capital employed. 3) Annualized income relative to average total equity. 4) Assuming dilution when applicable and net of treasury shares. 5) Participating share awards with right to receive dividend equivalents are (under the two-class method) excluded from the EPS calculation.

Full year 2018

Full year 2017

Reported
U.S. GAAP

Adjust-ments¹⁾

Non-U.S.
GAAP

Reported
U.S. GAAP

Adjust-ments¹⁾

Non-U.S.
GAAP

Operating income

$686.0

$222.2

$908.2

$859.6

$39.7

$899.3

Operating margin, %

7.9

2.6

10.5

10.6

0.5

11.1

1) Costs for capacity alignment and antitrust related matters in 2017 and 2018, and separation of our business segments in 2018.

Full year 2016

Reported
U.S. GAAP

Adjust-

ments¹⁾

Non-U.S.
GAAP

Operating income

$831.0

$34.5

$865.5

Operating margin, %

10.5

0.4

10.9

1) Costs for capacity alignment and antitrust related matters.

Items included in Non-U.S. GAAP adjustments

Fourth quarter 2020

Fourth quarter 2019

Adjustment
Millions

Adjustment
Per share

Adjustment
Millions

Adjustment
Per share

Capacity alignment

$4.4

$0.05

$12.9

$0.15

Antitrust related matters

0.2

0.00

(0.0)

(0.00)

Separations costs

–

–

(0.0)

(0.00)

Total adjustments to operating income

$4.6

$0.05

$12.9

$0.15

Tax on non-U.S. GAAP adjustments¹⁾

(1.2)

(0.01)

(7.5)

(0.09)

Total adjustments to net income

$3.4

$0.04

$5.4

$0.06

Average number of shares outstanding - diluted²⁾

                  87.5

                  87.4

Annualized adjustment on return on capital employed

$18.4

$51.6

Adjustment return on capital employed, %

(0.3)

1.2

Annualized adjustment on return on total equity

$13.6

$21.6

Adjustment return on total equity, %

(0.6)

0.5

1) The tax is calculated based on the tax laws in the respective jurisdiction(s) of the adjustment(s). 2) Annualized average number of outstanding shares

Items included in Non-GAAP adjustments

Full year 2020

Full year 2019

Adjustment
Millions

Adjustment
Per share

Adjustment
Millions

Adjustment
Per share

Capacity alignment

$98.8

$1.13

$53.6

$0.61

Antitrust related matters

0.7

0.01

(6.2)

(0.07)

Separation costs

–

–

1.2

0.01

Total adjustments to operating income

$99.5

$1.14

$48.6

$0.55

Tax on non-U.S. GAAP adjustments¹⁾

(11.1)

(0.13)

(10.6)

(0.12)

Total adjustments to Income from Continuing operations

$88.4

$1.01

$38.0

$0.43

Average number of shares outstanding - diluted²⁾

                  87.5

                  87.4

Annualized adjustment on Return on capital employed

$99.5

$48.6

Adjustment Return on capital employed, %

2.5

1.2

Annualized adjustment on Return on total equity

$88.4

$38.0

Adjustment return on total equity, %

3.9

1.7

1) The tax is calculated based on the tax laws in the respective jurisdiction(s) of the adjustment(s). 2) Annualized average number of outstanding shares.

(Dollars in millions, unaudited)

2020

2019

2018

2017

2016

Sales and Income

Net sales

$7,447

$8,548

$8,678

$8,137

$7,922

Airbag sales¹⁾

4,824

5,676

5,699

5,342

5,256

Seatbelt sales

2,623

2,871

2,980

2,794

2,665

Operating income

382

726

686

860

831

Net income attributable to controlling interest

187

462

376

586

558

Earnings per share (US$) – basic²⁾

2.14

5.29

4.32

6.70

6.33

Earnings per share (US$) – assuming dilution^{2, 3)}

2.14

5.29

4.31

6.68

6.32

Gross margin, %⁴⁾

16.7

18.5

19.7

20.6

20.6

R,D&E net in relation to sales, %

(5.0)

(4.7)

(4.8)

(4.6)

(4.5)

S,G &A net in relation to sales, %

(5.2)

(4.7)

(4.5)

(5.0)

(5.0)

Operating margin, %⁵⁾

5.1

8.5

7.9

10.6

10.5

Adjusted operating margin, %^{6, 7)}

6.5

9.1

10.5

11.1

10.9

Balance Sheet

Operating working capital

223

565

478

581

488

Days receivables outstanding⁸⁾

86

70

71

76

70

Days inventory outstanding⁹⁾

42

35

35

35

32

Total equity

2,423

2,122

1,897

4,169

3,926

Total parent shareholders’ equity per share (US$)

27.56

24.19

21.63

46.38

41.69

Current assets excluding cash

3,091

2,557

2,670

2,598

2,269

Property, plant and equipment, net

1,869

1,816

1,690

1,609

1,329

Intangible assets (primarily goodwill)

1,412

1,410

1,423

1,440

1,430

Capital employed

3,637

3,772

3,516

4,538

4,225

Net debt⁷⁾

1,214

1,650

1,619

368

299

Total assets

8,157

6,771

6,722

6,947

6,565

Long-term debt

2,110

1,726

1,609

1,311

1,313

Operating working capital in relation to sales, %

3.0

6.6

5.5

7.1

6.2

Return on capital employed, %^{10, 11)}

10

20

17

n/a

n/a

Return on total equity, %^{11, 12)}

9

23

13

n/a

n/a

Total equity ratio, %

30

31

28

49

48

Cash flow and Other data

Operating Cash flow¹³⁾

849

641

591

936

868

Depreciation and amortization¹³⁾

371

351

397

426

383

Capital expenditures, net¹³⁾

340

476

555

570

499

Capital expenditures, net in relation to sales, %¹³⁾

4.6

5.6

5.7

5.5

4.9

Free Cash flow^{7, 13, 14)}

509

165

36

366

369

Cash conversion, %^{7, 13, 15)}

270.5

35.6

19.5

120.8

65.7

Direct shareholder return^{13, 16)}

54

217

214

366

203

Cash dividends paid per share (US$)

0.62

2.48

2.46

2.38

2.30

Number of shares outstanding (millions)¹⁷⁾

87.4

87.2

87.1

87.0

88.2

Number of employees, December 31

61,000

58,900

57,700

56,700

55,800

1) Including steering wheels, inflators and initiators. 2) Participating share awards with right to receive dividend equivalents are (under the two-class method) excluded from the EPS calculation. 3) Assuming dilution and net of treasury shares. 4) Gross profit relative to sales. 5) Operating income relative to sales. 6) Excluding costs for capacity alignment, antitrust related matters and separation of our business segments in 2019 and 2018. 7) Non-US GAAP measure, for reconciliation see tables above. 8) Outstanding receivables relative to average daily sales. 9) Outstanding inventory relative to average daily sales. 10) Operating income and income from equity method investments, relative to average capital employed. 11) The Company has decided not to recalculate prior periods since the distribution of Veoneer had a significant impact on total equity and capital employed making the comparison less meaningful. 12) Income relative to average total equity. 13) Including Discontinued Operations for 2016-2018. 14) Operating cash flow less Capital expenditures, net. 15) Free cash flow relative to Net income. 16) Dividends paid and Shares repurchased. 17) At year end, excluding dilution and net of treasury shares.