Investor Presentaiton
Fourth Quarter and Full-Year Reconciliation to
US GAAP
Adjusted Operating Income and Operating Margin
In 2021 and prior, the Company defined adjusted operating income as operating income adjusted to exclude the impact of restructuring expense, merger, acquisition and
divestiture expense, other net expenses, discontinued operations, and other gains and losses not reflective of the Company's ongoing operations. Beginning in the first quarter
of 2022, the Company updated its definition of adjusted operating income and adjusted operating margin to add back intangible asset amortization expense. The updated
definition of adjusted operating income is operating income adjusted to exclude the impact of restructuring expense, merger, acquisition and divestiture expense, intangible
asset amortization expense, other net expenses, discontinued operations, and other gains and losses not reflective of the Company's ongoing operations. Adjusted operating
margin is defined as adjusted operating income divided by net sales.
20
$ in millions
Net sales
Operating income
Operating margin
Non-comparable items:
Intangible asset amortization
Restructuring expense
Merger, acquisition and divestiture expense, net
Asset impairments and lease modifications
Loss (gain) on sales of businesses
Other, primarily asset write-offs
Customer warranty settlement
Adjusted operating income
Adjusted operating margin
2022
$ 4,108 $ 3,655
Three Months Ended
December 31,
2021
Twelve Months
Ended December 31,
2022
2021
$ 15,801 $ 14,838
$
+A
361 $ 178
$ 1,374 $
1,151
8.8 %
4.9 %
8.7 %
7.8 %
+A
$
23
A
23
$
97
A
88
0
20
59
163
14
40
50
30
17
30
17
23
2
22
(13)
29
3
16
(3)
124
124
$
428
$
398
$ 1,603
$ 1,619
10.4 %
10.9 %
10.1 %
10.9 %
Note: 2021 has been updated from the prior adj. operating income definition of $375 million QTD and $1,531 million YTD of adj. operating income and 10.3%
QTD and 10.3% YTD of Adj. operating margin by adding back the $23 million QTD and $88 million YTD of intangible asset amortization expense.
* BorgWarnerView entire presentation