BorgWarner Inc (0HOU.L) Q4 2024 Earnings Report

Given the Q4 2024 results, the near-term emphasis is likely to be on profitability restoration and balance sheet optimization. Absent explicit management guidance in the provided data, the outlook rests on several drivers: (1) margin recovery through cost containment and mix improvement, (2) volume/M&A opportunities in EV propulsion and turbo/electronical components as demand shifts toward electrification, and (3) deleveraging through free cash flow generation and selective capital allocation. Potential targets to monitor include: operating margin trajectory back toward breakeven or positive levels, EBITDA improvement through cost controls, and debt reduction pace. In a base-case scenario, a gradual improvement in gross margins (to the low-to-mid 20% range) coupled with stabilized SG&A could shift EBITDA toward positive territory within 2-4 quarters, contingent on stable or modestly rising volumes. Key risks to the outlook include weaker auto production volumes in key markets, raw material cost volatility, and competitive pressure from other global auto parts suppliers. Investors should monitor management commentary on cost-reduction programs, capital allocation plans (dividend sustainability vs. debt repayment), and progress in EV-related product lines.