On Oct. 27, vehicle powertrain parts maker BorgWarner (NYSE:BWA) released third-quarter earnings for the period ending Sept. 30.

  • 5.2% revenue growth in the engine segment, partially offset by 8% decline in the drivetrain segment, led to a meager rise in sales of 0.8%.
  • Gross margin continued to be harmed by higher raw material costs, including nickel, steel, copper, aluminum, and plastic resin.
  • Restructuring expenses along with the higher cost of sales led to 36.4% decline in GAAP EPS, to $0.68.
  • Regardless of the results, the stock is still well-loved in Motley Fool CAPS, with 13 all-stars rating it "outperform," versus zero "underperform" ratings.

(Figures in millions, except per-share data)

Income Statement Highlights

Avg. Est.

Q3 2006

Q3 2005

Change

Sales

$1,104

$1,059.8

$1,050.9

0.8%

Net Profit

--

$39.2

$61.4

(36.2%)

EPS

$0.87

$0.7

$1.1

(36.4%)

Diluted Shares

--

$58.0

$57.5

0.9%



Get back to basics with a look at the income statement.

Margin Checkup

Q3 2006

Q3 2005

Change*

Gross Margin

17.30%

19.81%

(2.51)

Operating Margin

5.72%

8.61%

(2.89)

Net Margin

3.70%

5.84%

(2.14)

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q3 2006

Q3 2005

Change

Cash + ST Invest.

$138.3

$139.5

(0.9%)

Accounts Rec.

$695.6

$660.8

5.3%

Inventory

$379.9

$347.8

9.2%



Liabilities

Q3 2006

Q3 2005

Change

Accounts Payable *

$794.4

$740.6

7.3%

Long-Term Debt

$512.5

$626.6

(18.2%)

*Includes accrued expenses.

Learn the ways of the balance sheet.

Cash Flow Highlights

YTD 2006

YTD 2005

Change

Cash From Ops.

$270.7

$260.8

3.8%

Capital Expenditures

$191.9

$179.7

6.8%

Free Cash Flow

$78.8

$81.1

(2.8%)



Find out why Fools always follow the money.

Related Companies:

  • Tomkins (NYSE:TKS)
  • TRW Automotive Holdings (NYSE:TRW)
  • Gentex (NASDAQ:GNTX)

Related Foolishness:

BorgWarner is a Motley Fool Stock Advisor selection. Sign up today for a free report.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean. This data has been provided by Netscribes. To provide feedback on this article, please click on the "feedback" button below.