Autoliv (ALIV) Q4 2002 earnings summary

Executive summary

• Leading occupant-safety supplier, with production facilities in 30 countries and customers among almost all major global automakers.

• 2002 sales were $4.4B; airbags and related products contributed ~71%, and seat belts and related products ~29%.

Financial highlights

• Research, development and engineering expense was $229.8M in 2002, versus $200.8M in 2001 and $195.7M in 2000.

• Joint venture operations generated ~$306M of external sales in 2002 and were accounted for under the equity method.

Outlook and guidance

• Cost-saving programs target material, production and administrative costs as automakers continue seeking price reductions over product life cycles.

• Advanced-airbag rules require 20% of US light vehicles to comply in the first phase (Sep. 2003–Aug. 2004), 65% the next model year and 100% the third.

• Advanced-airbag rules are expected to raise frontal-airbag system unit prices and expand the North American airbag market, with effects on other markets.