Dana Holding Corporation Reports Third-Quarter Results
Resource from: Dana Holding Corporation Likes:2991
Oct 28,2011
- Reported quarterly net income of $110 million and year-to-date net income of $148 million
- Posted adjusted EBITDA of $200 million on sales of $2.0 billion
- Achieved adjusted EBITDA margin of 10.2 percent
- Generated free cash flow of $50 million
- Portfolio of fuel-saving technologies continued to expand
MAUMEE, Ohio, Oct. 27, 2011 /PRNewswire/ -- Dana Holding Corporation (NYSE: DAN) today announced its third-quarter 2011 results. The company recorded third-quarter net income of $110 million, which included a $60 million gain from the sale of interests in two joint ventures to Getrag, and adjusted EBITDA of $200 million; these compared to $46 million and $148 million, respectively, for the prior-year period. Year-to-date net income was $148 million, compared to $24 million in 2010.
Sales for the quarter were $2.0 billion, up nearly 30 percent over the third quarter of 2010. Dana achieved an adjusted EBITDA margin of 10.2 percent, compared to 9.8 percent for the prior-year period. Diluted adjusted earnings per share in the quarter were $0.45, compared to $0.28 in the prior-year period.
Dana generated free cash flow of $50 million during the third quarter. Additionally, the company received $136 million in cash from the sale of joint venture interests to Getrag. Global liquidity remains strong at $1.3 billion.
"Achieving our third-quarter targets reflects disciplined execution of the fundamentals – delivering quality product on time, controlling costs, and offering innovative technologies to help our customers improve fuel efficiency," said Dana President and Chief Executive Officer Roger J. Wood. "Order volumes remain strong overall, and we remain on track to meet our 2011 objectives."
Sales for the first nine months of the year were $5.7 billion, up $1.1 billion over the same period in 2010. Adjusted EBITDA for the nine-month period was $582 million, up $172 million over the same period one year ago.
Product Technologies
Improving fuel efficiency and reducing emissions continue to drive Dana's product development efforts. Third-quarter highlights in this area included:
Dana and Bosch Rexroth AG completed their 50-50 joint venture to develop and manufacture advanced hydromechanical variable transmissions for off-highway vehicles. Test vehicles with this technology have shown fuel savings of up to 20 percent;
Dana launched the lightweight Spicer® 90S drive axle, developed specifically for commercial vehicles in the Indian market; and
Broad-based interest continued in Dana's battery cooling technologies, which are now part of 20 electric and hybrid-electric vehicles, as well as its fuel cell components.
Dana was recently recognized for two products that help improve fuel efficiency. The company received the 2011 North American Frost & Sullivan Technology Innovation Award for its heavy-duty Spicer Diamond™ Series driveshaft, which weighs up to 40 percent less than a traditional all-steel driveshaft. Dana's line of active warm-up units was also chosen as a finalist for the Automotive News PACE Awards.
Guidance for 2011
Dana updated its earnings guidance for 2011:
Adjusted EBITDA is now projected to be approximately $780 million versus the previous guidance of $765 million to $785 million; and
Diluted adjusted earnings per share are expected to total $1.65 to $1.70 compared to earlier guidance of $1.60 to $1.70 per diluted adjusted share.
Dana to Host Third-Quarter Conference Call at 10 a.m. Today
Dana will discuss its second-quarter results in a conference call at 10 a.m. EDT today. Participants may listen to the conference call via audio streaming online or telephone. Slide viewing is available via Dana's investor website – www.dana.com/investors. United States and Canadian locations should dial 1-888-311-4590 and international locations should call 1-706-758-0054, and enter conference I.D. number 17756215. Please ask for the "Dana Holding Corporation Financial Webcast." Phone registration will be available starting at 9:30 a.m.
An audio recording of the webcast will be available after 5 p.m. today; dial 1-855-859-2056 (U.S. or Canada) or 1-404-537-3406 (international) and enter Conference I.D. 17756215. A webcast replay will be available after 5 p.m. today, and may be accessed via Dana's Investor website.
Non-GAAP Measures
This release refers to adjusted EBITDA, a non-GAAP financial measure that we have defined as earnings before interest, taxes, depreciation, amortization, non-cash equity grant expense, restructuring expense, and other nonrecurring items (gain/loss on debt extinguishment or divestitures, impairment, etc). The most significant impact to Dana's ongoing results of operations as a result of applying fresh start accounting is 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 net income (loss) before income taxes or other reported results prepared in accordance with GAAP.
Diluted adjusted EPS, another non-GAAP financial measure referenced in this release, is 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.
Free cash flow is also a non-GAAP financial measure referenced in this release, which we have defined as cash provided by (used in) operating activities, excluding any bankruptcy claim-related payments, less purchases of property, plant, and equipment. This measure is useful in evaluating the operational cash flow of the company, inclusive of the spending required to maintain the operations.
The financial information accompanying this release provides reconciliations of adjusted EBITDA, diluted adjusted EPS, and free cash flow to the most directly comparable financial measures calculated and presented in accordance with GAAP.
(Dana Holding Corporation)
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