Autoliv rallies as profit beats expectations, as price hikes offset raw materials inflation

Shares of Autoliv Inc.
ALV,
+9.24%
rallied 3.4% in premarket trading Friday, after the Sweden-based maker of automotive safety systems beat fourth-quarter profit expectations, but came up shy on revenue, as price increases compensated for raw material cost inflation. Operating income rose to $230 million, or $1.80 a share, from $174 million, or $1.31 a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share of $1.83 topped the FactSet consensus of $1.73. Sales grew 10.2% to $2.34 billion, below the FactSet consensus of $2.41 billion. Operating margin improved to 9.8% from 8.2%. For 2023, the company expects organic sales growth of 15%. “We believe price adjustments will offset the non-raw material cost inflation, with small positive effects in the first quarter and gradually larger positive effects as the year progresses,” the company said in a statement. The stock has gained 6.1% over the past three months while the S&P 500
SPX,
+0.25%
has advanced 6.7%.