Dana Reports First-Quarter 2013 Results, Affirms 2013 Earnings Outlook
In line with reduced sales, net income for the quarter was
Adjusted EBITDA for the quarter was
Overall, adjusted EBITDA as a percent of sales for the quarter was 9.4 percent (10.1 percent excluding the Venezuelan currency devaluation), compared with 10.7 percent for the same period in 2012 and 9.6 percent in the fourth quarter of 2012.
Free cash flow was a use of
"Demand levels in a number of our key markets provided a bit of a headwind for us in the first quarter, but overall results were in line with our expectations. We continue to achieve solid margins in spite of challenging market conditions by focusing on those levers within our control," said company President and Chief Executive Officer
The company purchased about 1.4 million shares at a cost of about
Company Affirms 2013 Financial Targets
Dana affirmed its financial targets for full-year 2013:
- Sales of approximately
$7.1 billion , - Adjusted EBITDA of
$800 million to $820 million , - Adjusted EBITDA as a percent of sales of approximately 11.4 percent,
- Diluted adjusted EPS of
$1.88 to $1.95 (excluding the impact of Dana's share repurchase program), - Capital spending of
$180 million to $200 million , and - Free cash flow of
$240 million to $260 million .
"We expect to capitalize on improved volumes through the remainder of the year. In particular, the performance of our Commercial Vehicle Driveline business is dependent on an expected uptick in market demand, and we are closely watching releases from our customers," Mr. Wood said. "By continuing to maintain our operational flexibility and executing our business model, we are confident in our ability to drive margins commensurate with top line growth."
Dana Earns PACE Awards
Dana earned a 2013
This driveshaft eliminates the need for a center bearing, helping to reduce component complexity and weight by up to 100 pounds. Additionally, the Spicer® Diamond Series™ driveshaft requires no exterior tube painting and eliminates the metal inert gas (MIG) welding process, helping to reduce emissions during manufacturing.
New Technologies Introduced
Dana introduced a number of new products in the first quarter aimed at targeting specific market-value drivers, such as fuel economy, emissions control, and total cost of ownership. These technology solutions include:
- Best-in-class Spicer® AdvanTEK® 40 tandem axles for line-haul Class 8 trucks that improve fuel efficiency and reduce total cost of ownership;
- Enhanced Spicer Life Series® driveshafts capable of handling greater torque capacities than any other driveshaft in the class;
- Spicer® EconoTrek™ tandem axles that reduce weight by up to 450 pounds, delivering between a 2 and 3 percent improvement in fuel efficiency;
- Spicer® electric-vehicle gearbox with an optimized gear ratio that provides increased acceleration, enabling drivers to reach highway speeds more quickly; and
- A new Spicer® TE30 powershift transmission that provides reach stackers and heavy-duty forklift trucks with greater fuel economy and lower cost of ownership.
New Technical Research Center Opens in
Dana also celebrated the opening of its new 129,000 square-foot technical center in Wuxi,
Conference Call Scheduled for
Dana will discuss its first-quarter results in a conference call at
An audio recording of the webcast will be available after
Non-GAAP Financial Information
This release refers to adjusted EBITDA, which we have defined to be earnings before interest, taxes, depreciation, amortization, equity grant expense, restructuring expense and other nonrecurring items (gain/loss on debt extinguishment or divestitures, impairment, etc.). The most significant impact on Dana's ongoing results of operations as a result of applying fresh start accounting following our emergence from bankruptcy was higher depreciation and amortization. By using adjusted EBITDA, a performance measure that excludes depreciation and amortization, the comparability of results is enhanced. Management also believes that adjusted EBITDA is an important measure since the financial covenants in our debt agreements are based, in part, on adjusted EBITDA. Adjusted EBITDA should not be considered a substitute for income (loss) before income taxes, net income (loss) or other results reported in accordance with GAAP. Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.
Diluted adjusted EPS is a non-GAAP financial measure that we have defined as adjusted net income divided by adjusted diluted shares. We define adjusted net income as net income (loss) attributable to the parent company, excluding restructuring expense, amortization expense and nonrecurring items (as used in adjusted EBITDA), net of any associated income tax effects. We define adjusted diluted shares as diluted shares as determined in accordance with GAAP based on adjusted net income. This measure is considered useful for purposes of providing investors, analysts, and other interested parties with an indicator of ongoing financial performance that provides enhanced comparability to EPS reported by other companies. Diluted adjusted EPS is neither intended to represent nor be an alternative measure to diluted EPS reported under GAAP.
Free cash flow is a non-GAAP financial measure that we have defined as cash provided by (used in) operating activities, less purchases of property, plant, and equipment. We believe this measure is useful to investors in evaluating the operational cash flow of the company inclusive of the spending required to maintain the operations. Free cash flow is neither intended to represent nor be an alternative to the measure of net cash provided by (used in) operating activities reported under GAAP. Free cash flow may not be comparable to similarly titled measures reported by other companies.
Please reference the "Non-GAAP financial information" accompanying our quarterly earnings conference call presentations on our website at www.dana.com/investors for our GAAP results and the reconciliations of these measures, where used, to the comparable GAAP measures.
Forward-Looking Statements
Certain statements and projections contained in this news release are, by their nature, forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on our current expectations, estimates and projections about our industry and business, management's beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement.
Dana's Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other
About
Dana is a world-leading supplier of driveline, sealing, and thermal-management technologies that improve the efficiency and performance of passenger, commercial, and off-highway vehicles with both conventional and alternative-energy powertrains. The company's global network of engineering, manufacturing, and distribution facilities provides original-equipment and aftermarket customers with local product and service support. Based in
DANA HOLDING CORPORATION |
||||||
Consolidated Statement of Operations (Unaudited) |
||||||
For the Three Months Ended March 31, 2013 and 2012 |
||||||
Three Months Ended |
||||||
(In millions except per share amounts) |
March 31, |
|||||
2013 |
2012 |
|||||
Net sales |
$ 1,676 |
$ 1,964 |
||||
Costs and expenses |
||||||
Cost of sales |
1,462 |
1,698 |
||||
Selling, general and administrative expenses |
103 |
113 |
||||
Amortization of intangibles |
19 |
19 |
||||
Restructuring charges, net |
2 |
5 |
||||
Other income (expense), net |
2 |
(1) |
||||
Income from continuing operations before |
||||||
interest expense and income taxes |
92 |
128 |
||||
Interest expense |
21 |
21 |
||||
Income from continuing operations before |
||||||
income taxes |
71 |
107 |
||||
Income tax expense |
27 |
37 |
||||
Equity in earnings of affiliates |
4 |
4 |
||||
Income from continuing operations |
48 |
74 |
||||
Income (loss) from discontinued operations |
2 |
(1) |
||||
Net income |
50 |
73 |
||||
Less: Noncontrolling interests net income |
8 |
3 |
||||
Net income attributable to the parent company |
42 |
70 |
||||
Preferred stock dividend requirements |
8 |
8 |
||||
Net income available to common stockholders |
$ 34 |
$ 62 |
||||
Net income per share available to parent |
||||||
company common stockholders: |
||||||
Basic: |
||||||
Income from continuing operations |
$ 0.22 |
$ 0.43 |
||||
Income (loss) from discontinued operations |
$ 0.01 |
$ (0.01) |
||||
Net income |
$ 0.23 |
$ 0.42 |
||||
Diluted: |
||||||
Income from continuing operations |
$ 0.18 |
$ 0.33 |
||||
Income from discontinued operations |
$ 0.01 |
$ - |
||||
Net income |
$ 0.19 |
$ 0.33 |
||||
Weighted-average common shares outstanding |
||||||
Basic |
148.0 |
147.5 |
||||
Diluted |
214.4 |
214.7 |
||||
Dividends declared per common share |
$ 0.05 |
$ 0.05 |
||||
DANA HOLDING CORPORATION |
||||||||
Consolidated Statement of Comprehensive Income (Unaudited) |
||||||||
For the Three Months Ended March 31, 2013 and 2012 |
||||||||
Three Months Ended |
||||||||
(In millions) |
March 31, |
|||||||
2013 |
2012 |
|||||||
Net income |
$ 50 |
$ 73 |
||||||
Less: Noncontrolling interests net income |
8 |
3 |
||||||
Net income attributable to the parent company |
42 |
70 |
||||||
Other comprehensive income (loss) attributable to |
||||||||
the parent company, net of tax: |
||||||||
Currency translation adjustments |
(17) |
44 |
||||||
Unrealized hedging gains and losses |
3 |
8 |
||||||
Unrealized investment and other gains and losses |
1 |
2 |
||||||
Defined benefit plans |
8 |
2 |
||||||
Other comprehensive income (loss) attributable |
||||||||
to the parent company |
(5) |
56 |
||||||
Other comprehensive income (loss) attributable to |
||||||||
noncontrolling interests, net of tax: |
||||||||
Currency translation adjustments |
(2) |
1 |
||||||
Other comprehensive income (loss) attributable |
||||||||
to noncontrolling interests |
(2) |
1 |
||||||
Total comprehensive income attributable |
||||||||
to the parent company |
37 |
126 |
||||||
Total comprehensive income attributable |
||||||||
to noncontrolling interests |
6 |
4 |
||||||
Total comprehensive income |
$ 43 |
$ 130 |
||||||
DANA HOLDING CORPORATION |
|||||
Consolidated Balance Sheet (Unaudited) |
|||||
As of March 31, 2013 and December 31, 2012 |
|||||
(In millions except share and per share amounts) |
|||||
March 31, |
December 31, |
||||
Assets |
2013 |
2012 |
|||
Current assets |
|||||
Cash and cash equivalents |
$ 981 |
$ 1,059 |
|||
Marketable securities |
63 |
60 |
|||
Accounts receivable |
|||||
Trade, less allowance for doubtful accounts |
|||||
of $9 in 2013 and $8 in 2012 |
980 |
818 |
|||
Other |
231 |
170 |
|||
Inventories |
776 |
742 |
|||
Other current assets |
126 |
104 |
|||
Total current assets |
3,157 |
2,953 |
|||
Goodwill |
99 |
101 |
|||
Intangibles |
303 |
325 |
|||
Other noncurrent assets |
258 |
324 |
|||
Investments in affiliates |
208 |
202 |
|||
Property, plant and equipment, net |
1,209 |
1,239 |
|||
Total assets |
$ 5,234 |
$ 5,144 |
|||
Liabilities and equity |
|||||
Current liabilities |
|||||
Notes payable, including current portion of long-term debt |
$ 84 |
$ 101 |
|||
Accounts payable |
914 |
766 |
|||
Accrued payroll and employee benefits |
136 |
160 |
|||
Accrued restructuring costs |
23 |
23 |
|||
Taxes on income |
69 |
63 |
|||
Other accrued liabilities |
180 |
197 |
|||
Total current liabilities |
1,406 |
1,310 |
|||
Long-term debt |
839 |
803 |
|||
Pension and postretirement obligations |
681 |
715 |
|||
Other noncurrent liabilities |
360 |
368 |
|||
Total liabilities |
3,286 |
3,196 |
|||
Commitments and contingencies |
|||||
Parent company stockholders' equity |
|||||
Preferred stock, 50,000,000 shares authorized |
|||||
Series A, $0.01 par value, 2,500,000 shares outstanding |
242 |
242 |
|||
Series B, $0.01 par value, 5,221,199 shares outstanding |
511 |
511 |
|||
Common stock, $0.01 par value, 450,000,000 shares authorized, |
|||||
147,368,839 and 148,264,067 outstanding |
2 |
2 |
|||
Additional paid-in capital |
2,680 |
2,668 |
|||
Accumulated deficit |
(736) |
(762) |
|||
Treasury stock, at cost (3,344,863 and 1,797,988 shares) |
(51) |
(25) |
|||
Accumulated other comprehensive loss |
(801) |
(793) |
|||
Total parent company stockholders' equity |
1,847 |
1,843 |
|||
Noncontrolling equity |
101 |
105 |
|||
Total equity |
1,948 |
1,948 |
|||
Total liabilities and equity |
$ 5,234 |
$ 5,144 |
|||
DANA HOLDING CORPORATION |
|||||
Consolidated Statement of Cash Flows (Unaudited) |
|||||
For the Three Months Ended March 31, 2013 and 2012 |
|||||
Three Months Ended |
|||||
(In millions) |
March 31, |
||||
2013 |
2012 |
||||
Operating activities |
|||||
Net income |
$ 50 |
$ 73 |
|||
Depreciation |
42 |
49 |
|||
Amortization of intangibles |
22 |
22 |
|||
Amortization of deferred financing charges |
1 |
1 |
|||
Unremitted earnings of affiliates |
(4) |
(3) |
|||
Stock compensation expense |
5 |
7 |
|||
Deferred income taxes |
(2) |
2 |
|||
Pension contributions, net |
(16) |
(165) |
|||
Change in working capital |
(109) |
(137) |
|||
Other, net |
(4) |
(2) |
|||
Net cash flows used in operating activities (1) |
(15) |
(153) |
|||
Investing activities |
|||||
Purchases of property, plant and equipment (1) |
(29) |
(34) |
|||
Acquisition of business |
(4) |
||||
Other |
1 |
(2) |
|||
Net cash flows used in investing activities |
(32) |
(36) |
|||
Financing activities |
|||||
Net change in short-term debt |
(3) |
20 |
|||
Proceeds from long-term debt |
53 |
16 |
|||
Repayment of long-term debt |
(30) |
(3) |
|||
Dividends paid to preferred stockholders |
(8) |
(8) |
|||
Dividends paid to common stockholders |
(7) |
||||
Distributions paid to noncontrolling interests |
(1) |
||||
Repurchases of common stock |
(24) |
||||
Payments to acquire noncontrolling interests |
(7) |
||||
Other |
1 |
||||
Net cash flows provided by (used in) financing activities |
(20) |
19 |
|||
Net decrease in cash and cash equivalents |
(67) |
(170) |
|||
Cash and cash equivalents − beginning of period |
1,059 |
931 |
|||
Effect of exchange rate changes on cash balances |
(11) |
12 |
|||
Cash and cash equivalents − end of period |
$ 981 |
$ 773 |
|||
(1) Free cash flow of $(44) in 2013 and $(187) in 2012 is the sum of net cash used in |
|||||
operating activities reduced by the purchases of property, plant and equipment. |
|||||
DANA HOLDING CORPORATION |
|||||
Segment Sales & Segment EBITDA (Unaudited) |
|||||
For the Three Months Ended March 31, 2013 and 2012 |
|||||
(In millions) |
Three Months Ended |
||||
March 31, |
|||||
Sales |
2013 |
2012 |
|||
Light Vehicle Driveline |
$ 619 |
$ 727 |
|||
Power Technologies |
256 |
268 |
|||
Commercial Vehicle |
458 |
551 |
|||
Off-Highway |
343 |
418 |
|||
Total Sales |
$ 1,676 |
$ 1,964 |
|||
Segment EBITDA |
|||||
Light Vehicle Driveline |
$ 41 |
$ 63 |
|||
Power Technologies |
36 |
40 |
|||
Commercial Vehicle |
41 |
61 |
|||
Off-Highway |
41 |
49 |
|||
Total Segment EBITDA |
159 |
213 |
|||
Corporate expense and other items, net |
(1) |
(3) |
|||
Structures EBITDA |
2 |
||||
Adjusted EBITDA |
$ 158 |
$ 212 |
|||
DANA HOLDING CORPORATION |
|||||
Reconciliation of Segment and Adjusted EBITDA |
|||||
to Net Income (Unaudited) |
|||||
For the Three Months Ended March 31, 2013 and 2012 |
|||||
(In millions) |
Three Months Ended |
||||
March 31, |
|||||
2013 |
2012 |
||||
Segment EBITDA |
$ 159 |
$ 213 |
|||
Corporate expense and other items, net |
(1) |
(3) |
|||
Structures EBITDA |
2 |
||||
Adjusted EBITDA |
158 |
212 |
|||
Depreciation |
(42) |
(48) |
|||
Amortization of intangibles |
(22) |
(22) |
|||
Restructuring |
(2) |
(5) |
|||
Strategic transaction and other expenses |
(2) |
(3) |
|||
Impairment and loss on sale of assets |
(3) |
||||
Structures EBITDA |
(2) |
||||
Stock compensation expense |
(5) |
(7) |
|||
Interest expense |
(21) |
(21) |
|||
Interest income |
7 |
6 |
|||
Income from continuing operations before |
|||||
income taxes |
71 |
107 |
|||
Income tax expense |
27 |
37 |
|||
Equity in earnings of affiliates |
4 |
4 |
|||
Income from continuing operations |
48 |
74 |
|||
Income (loss) from discontinued operations |
2 |
(1) |
|||
Net income |
$ 50 |
$ 73 |
|||
DANA HOLDING CORPORATION |
|||||
Diluted Adjusted EPS (Unaudited) |
|||||
For the Three Months Ended March 31, 2013 and 2012 |
|||||
(In millions except per share amounts) |
|||||
Three Months Ended |
|||||
March 31, |
|||||
2013 |
2012 |
||||
Net income attributable to parent company |
$ 42 |
$ 70 |
|||
Restructuring charges (1) |
2 |
5 |
|||
Amortization of intangibles (1) |
17 |
16 |
|||
Non-recurring items (1) |
(2) |
3 |
|||
Adjusted net income |
$ 59 |
$ 94 |
|||
Diluted shares - as reported |
214 |
215 |
|||
Adjusted diluted shares |
214 |
215 |
|||
Diluted adjusted EPS |
$ 0.28 |
$ 0.44 |
|||
(1) Amounts are net of associated tax effect. |
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SOURCE
Investor Contact: Craig Barber: 419.887.5166; Media Contact: Jeff Cole: 419.887.3535