Dana Corporation Announces Third-Quarter Results
Oct 17, 2000
Earnings in Line with Previously Announced Expectations
TOLEDO, Ohio, Oct. 17 /PRNewswire/ -- Dana Corporation (NYSE: DCN) today
announced that its sales for the quarter ended Sept. 30 were $2.9 billion,
down from $3.1 billion for the same period last year.
(Photo: http://www.newscom.com/cgi-bin/prnh/19990903/DANA )
Operating income for the quarter totaled $61 million, or 41 cents per
share -- in line with expectations announced by the company on Sept. 18.
Reported net income for the period was $29 million, or 19 cents per share.
This included net non-recurring expenses of $32 million after tax, primarily
attributable to the closure of the company's Reading, Pa., Structural Products
facility. For the third quarter of 1999, the company reported net income of
$162 million or 97 cents per share. Last year's results included
approximately $11 million of non-recurring after-tax charges.
Dana's nine-month consolidated sales were $9.6 billion, compared to $9.9
billion during the same period last year. Net income for the first three
quarters was $418 million, or $2.71 per share. This total included net non-
recurring income of $43 million after tax. Comparable results from 1999 were
net income of $513 million, or $3.07 per share, including non-recurring
charges of approximately $21 million after tax.
Among the factors impacting Dana's quarterly results were a number of
broad issues that affected the industry as a whole. These included unexpected
reductions in production schedules for light truck and sport utility vehicles
manufactured by several of Dana's largest customers, a declining U.S. heavy
truck market, softness in the U.S. and European aftermarkets, and the
continued weakness of the Euro.
"The past several months have been difficult for our entire sector, but
because of Dana's business mix, we have been particularly hard hit by the
convergence of all four of these factors," said Dana Chairman and CEO Joe
Magliochetti. "These challenges have come at a time when we are actively
repositioning Dana to focus on long-term, profitable growth in our foundation
businesses.
"We remain focused on our strategic direction. Year to date, we have
divested businesses with annual sales in excess of $660 million, for which we
have received proceeds of $562 million," he said. "Moving forward, we will
continue to evaluate the future of operations outside of our foundation
businesses and aggressively pursue the divestiture of those that are
considered to be non-strategic.
"We will continue to use our free cash flow, supported by these
divestiture proceeds, to invest in those technologies and businesses that will
drive our global growth, as well as for share repurchases and debt reduction,"
he added.
Dana Chief Financial Officer Bob Richter said, "We have undertaken a
number of aggressive actions to respond to current market conditions. These
include significant expense reduction initiatives, limitations on capital
spending, and workforce reductions totaling more than 3,500 people. This
includes the reductions associated with the closure of the Reading plant.
"We also continue to work toward the resolution of the software
implementation and integration issues associated with the consolidation of the
Automotive Aftermarket Group's Engine Controls warehouses, which are impacting
our performance.
"Until we see positive developments with respect to the factors that
affected our third quarter, we will remain guarded in our outlook for the
fourth quarter," he said.
Yesterday, Dana's Board approved a quarterly dividend of 31 cents per
share payable Dec. 15, 2000, to shareholders of record on Dec. 1. This will
mark Dana's 252nd consecutive dividend -- dating back to 1936 -- without a
reduced or missed payment.
Dana will hold a conference call at 9:30 a.m. (EDT) today to discuss its
third-quarter results. The dial-in number is (800) 275-3210. Please dial
into the conference 15 minutes prior to the start. A recording of this
conference call will be available after 5 p.m. (EDT) Wednesday, Oct. 18. To
access this recording, please dial (800) 537-8823.
Dana Corporation is one of the world's largest suppliers to vehicle
manufacturers and their related aftermarkets. Founded in 1904 and based in
Toledo, Ohio, the company operates approximately 320 major facilities in 32
countries and employs more than 80,000 people. The company reported sales of
$13.2 billion in 1999. Dana's Internet address is http://www.dana.com .
Certain statements contained herein constitute "forward-looking"
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements involve assumptions, uncertainties, and risks, and
Dana's actual future results, performance, or achievements may differ
materially from those expressed or implied in these statements. Among the
factors that could affect Dana's actual results are the ability of various
vehicular customers and suppliers to achieve projected sales and production
levels, the cyclical nature of the vehicular industry, international economic
conditions, and further delays in consolidation of the company's Engine
Controls warehouse network. Additional factors are detailed in Dana's public
filings with the Securities and Exchange Commission. Dana does not undertake
to update any forward-looking statements contained herein.
Dana Corporation
(in millions, except
per share amounts)
Unaudited
Three Months Ended September 30
1999 2000
Sales $3,127 $2,855
Net Income 162 29
Net Income Per Common Share -
Basic $0.98 $0.19
Diluted $0.97 $0.19
Average Shares Outstanding -
For Basic EPS 166 149
For Diluted EPS 167 150
Unaudited
Nine Months Ended September 30
1999 2000
Sales $9,915 $9,601
Net Income 513 418
Net Income Per Common Share -
Basic $3.10 $2.73
Diluted $3.07 $2.71
Average Shares Outstanding -
For Basic EPS 166 153
For Diluted EPS 167 154
Dana Corporation
Statement of Income (Unaudited)
September 30, 2000
(in millions, except per share amounts)
Three Months Ended September 30
1999 2000
Net sales $3,127 $2,855
Revenue from lease financing and other income 47 50
Total 3,174 2,905
Costs and expenses
Cost of sales 2,564 2,466
Selling, general and administrative expenses 289 281
Restructuring and integration charges 17 69
Interest expense 69 82
Total 2,939 2,898
Income before income taxes 235 7
Estimated taxes on income (81) 10
Minority interest (3) (4)
Equity in earnings of affiliates 11 16
Net income $162 $29
Net income per common share -
Basic $0.98 $0.19
Diluted $0.97 $0.19
Average shares outstanding -
For Basic EPS 166 149
For Diluted EPS 167 150
Dana Corporation
Statement of Income (Unaudited)
September 30, 2000
(in millions, except per share amounts)
Nine Months Ended September 30
1999 2000
Net sales $9,915 $9,601
Revenue from lease financing and other income 119 308
Total 10,034 9,909
Costs and expenses
Cost of sales 8,176 8,117
Selling, general and administrative expenses 875 863
Restructuring and integration charges 30 103
Interest expense 206 238
Total 9,287 9,321
Income before income taxes 747 588
Estimated taxes on income (267) (207)
Minority interest (10) (12)
Equity in earnings of affiliates 43 49
Net income $513 $418
Net income per common share -
Basic $3.10 $2.73
Diluted $3.07 $2.71
Average shares outstanding -
For Basic EPS 166 153
For Diluted EPS 167 154
Dana Corporation
Condensed Balance Sheet (Unaudited)
September 30, 2000
(in millions)
December 31 September 30
Assets 1999 2000
Current assets
Cash and marketable securities $111 $144
Accounts receivable
Trade 1,935 1,916
Other 411 424
Inventories 1,784 1,696
Other current assets 560 779
Total current assets 4,801 4,959
Property, plant and equipment, net 3,450 3,372
Investment in leases 1,014 1,062
Investments and other assets 1,858 2,009
Total assets $11,123 $11,402
Liabilities and Shareholders' Equity
Accounts payable and other
current liabilities $2,470 $2,473
Notes payable 1,418 1,965
Total current liabilities 3,888 4,438
Long-term debt 2,732 2,715
Deferred employee benefits
and other noncurrent liabilities 1,398 1,400
Minority interest 148 120
Shareholders' equity 2,957 2,729
Total liabilities and
shareholders' equity $11,123 $11,402
Dana Corporation
Condensed Statement of Cash Flows (Unaudited)
September 30, 2000
(in millions)
Three Months Ended September 30
1999 2000
Net income $162 $29
Depreciation and amortization 129 130
Gain on divestitures - (13)
Working capital change (138) (97)
Other 26 45
Net cash from operating activities 179 94
Purchases of property, plant and equipment (161) (130)
Purchases of assets to be leased (196) (171)
Payments received on leases and loans 107 61
Net loans to customers (62) (41)
Acquisitions (6) (74)
Divestitures - 38
Other 42 (17)
Net cash flows - investing activities (276) (334)
Net change in short-term debt 150 58
Proceeds from long-term debt 107 300
Payments on long-term debt (68) (55)
Dividends paid (51) (46)
Shares reacquired (32) (61)
Other (17) 1
Net cash flows - financing activities 89 197
Net change in cash and cash equivalents (8) (43)
Cash and cash equivalents - beginning of period 193 187
Cash and cash equivalents - end of period $185 $144
Dana Corporation
Condensed Statement of Cash Flows (Unaudited)
September 30, 2000
(in millions)
Nine Months Ended September 30
1999 2000
Net income $513 $418
Depreciation and amortization 392 390
Gain on divestitures (110) -
Working capital change (522) (223)
Other (81) (50)
Net cash from operating activities 302 425
Purchases of property, plant and equipment (562) (464)
Purchases of assets to be leased (318) (242)
Payments received on leases and loans 152 126
Net loans to customers (87) (147)
Acquisitions (12) (279)
Divestitures - 562
Other 24 27
Net cash flows - investing activities (803) (417)
Net change in short-term debt (195) 621
Proceeds from long-term debt 1,151 311
Payments on long-term debt (302) (388)
Dividends paid (154) (142)
Shares reacquired (43) (381)
Other (1) 4
Net cash flows - financing activities 456 25
Net change in cash and cash equivalents (45) 33
Cash and cash equivalents - beginning of period 230 111
Cash and cash equivalents - end of period $185 $144
Dana Corporation
(Including Dana Credit Corporation on an Equity Basis)
Statement of Income (Unaudited)
September 30, 2000
(in millions)
Three Months Ended September 30
1999 2000
Net sales $3,127 $2,855
Other income 11 3
Total 3,138 2,858
Costs and expenses
Cost of sales 2,577 2,482
Selling, general and
administrative expenses 263 252
Restructuring and
integration charges 17 69
Interest expense 51 55
Total 2,908 2,858
Income before income taxes 230 -
Estimated taxes on income (83) 13
Minority interest (3) (4)
Equity in earnings
of affiliates 18 20
Net income $162 $29
Dana Corporation
(Including Dana Credit Corporation on an Equity Basis)
Statement of Income (Unaudited)
September 30, 2000
(in millions)
Nine Months Ended September 30
1999 2000
Net sales $9,915 $9,601
Other income 19 183
Total 9,934 9,784
Costs and expenses
Cost of sales 8,214 8,163
Selling, general and
administrative expenses 799 787
Restructuring and
integration charges 30 103
Interest expense 157 163
Total 9,200 9,216
Income before income taxes 734 568
Estimated taxes on income (274) (204)
Minority interest (10) (12)
Equity in earnings
of affiliates 63 66
Net income $513 $418
Dana Corporation
(Including Dana Credit Corporation on an Equity Basis)
Condensed Balance Sheet (Unaudited)
September 30, 2000
(in millions)
December 31 September 30
Assets 1999 2000
Current assets
Cash and marketable securities $101 $136
Accounts receivable
Trade 1,935 1,893
Other 399 424
Inventories 1,784 1,696
Other current assets 418 512
Total current assets 4,637 4,661
Property, plant and equipment, net 3,064 2,937
Investments and other assets 1,801 1,843
Total assets $9,502 $9,441
Liabilities and Shareholders' Equity
Accounts payable and other
current liabilities $2,423 $2,419
Notes payable 897 1,317
Total current liabilities 3,320 3,736
Long-term debt 1,862 1,696
Deferred employee benefits
and other noncurrent liabilities 1,216 1,162
Minority interest 147 118
Shareholders' equity 2,957 2,729
Total liabilities and
shareholders' equity $9,502 $9,441
Dana Corporation
(Including Dana Credit Corporation on an Equity Basis)
Condensed Statement of Cash Flows (Unaudited)
September 30, 2000
(in millions)
Three Months Ended September 30
1999 2000
Net income $162 $29
Depreciation and amortization 106 105
Gain on divestitures - (13)
Working capital change (127) (104)
Other (15) (6)
Net cash from operating activities 126 11
Purchases of property, plant and equipment (105) (81)
Acquisitions (5) (74)
Divestitures - 38
Other 10 (24)
Net cash flows - investing activities (100) (141)
Net change in short-term debt 102 215
Proceeds from long-term debt
Payments on long-term debt (32) (13)
Dividends paid (51) (46)
Shares reacquired (32) (61)
Other (17) 2
Net cash flows - financing activities (30) 97
Net change in cash and cash equivalents (4) (33)
Cash and cash equivalents - beginning of period 187 169
Cash and cash equivalents - end of period $183 $136
Dana Corporation
(Including Dana Credit Corporation on an Equity Basis)
Condensed Statement of Cash Flows (Unaudited)
September 30, 2000
(in millions)
Nine Months Ended September 30
1999 2000
Net income $513 $418
Depreciation and amortization 323 319
Gain on divestitures - (110)
Working capital change (503) (202)
Other (102) (101)
Net cash from operating activities 231 324
Purchases of property, plant and equipment (384) (318)
Acquisitions (11) (279)
Divestitures - 562
Other (22) 9
Net cash flows - investing activities (417) (26)
Net change in short-term debt (473) 510
Proceeds from long-term debt 1,002 -
Payments on long-term debt (189) (255)
Dividends paid (154) (142)
Shares reacquired (43) (381)
Other (1) 5
Net cash flows - financing activities 142 (263)
Net change in cash and cash equivalents (44) 35
Cash and cash equivalents - beginning of period 227 101
Cash and cash equivalents - end of period $183 $136
Dana Corporation
Quarterly Financial Information
Q3 - 2000 (Unaudited)
(in millions)
Sales EBIT Operating PAT
99 00 99 00 99 00
Automotive Systems
Group $1,031 $1,089 $116 $83 $75 $58
Automotive Aftermarket
Group 756 693 85 30 52 18
Heavy Truck Group 461 345 52 27 32 17
Engine Systems Group 314 302 20 13 13 14
Fluid Systems Group 283 266 26 18 16 11
Off-Highway Systems
Group 189 150 14 9 9 6
Dana Commercial
Credit - - - - 10 7
Other 93 10 (21) (60) (34) (70)
Total Operations 3,127 2,855 292 120 173 61
Restructuring and
nonrecurring
items - - (17) (68) (11) (32)
Consolidated $3,127 $2,855 $275 $52 $162 $29
North America $2,458 $2,156 $295 $149 $183 $97
Europe 465 440 19 11 10 6
South America 141 158 6 10 5 8
Asia Pacific 63 101 (2) 3 (1) 2
Dana Commercial
Credit - - - - 10 7
Other - - (26) (53) (34) (59)
Total Operations 3,127 2,855 292 120 173 61
Restructuring and
nonrecurring items - - (17) (68) (11) (32)
Consolidated $3,127 $2,855 $275 $52 $162 $29
Dana Corporation
Quarterly Financial Information
Q3 - 2000 (Unaudited)
(in millions)
Net Profit Net Assets
99 00 99 00
Automotive Systems Group $64 $34 $1,834 $2,041
Automotive Aftermarket
Group 40 (2) 1,970 2,032
Heavy Truck Group 26 8 688 594
Engine Systems Group 10 8 1,181 1,111
Fluid Systems Group 13 6 763 700
Off-Highway Systems Group 7 3 559 434
Dana Commercial Credit 10 7 140 168
Other 3 (3) 189 76
Total Operations 173 61 7,324 7,156
Restructuring and
nonrecurring items (11) (32) - -
Consolidated $162 $29 $7,324 $7,156
North America $155 $53 $5,242 $5,015
Europe 4 (3) 1,359 1,338
South America 3 4 599 508
Asia Pacific (4) (1) 140 175
Dana Commercial Credit 10 7 140 168
Other 5 1 (156) (48)
Total Operations 173 61 7,324 7,156
Restructuring and
nonrecurring items (11) (32) - -
Consolidated $162 $29 $7,324 $7,156
Dana Corporation
Quarterly Financial Information
For Nine Months Ending September 30, 2000 (Unaudited)
(in millions)
Sales EBIT Operating PAT
99 00 99 00 99 00
Automotive Systems
Group $3,329 $3,589 $408 $363 $262 $240
Automotive
Aftermarket Group 2,326 2,174 245 133 149 81
Heavy Truck Group 1,424 1,310 156 131 95 80
Engine Systems Group 997 1,007 85 78 57 57
Fluid Systems Group 925 893 103 89 63 55
Off-Highway Systems
Group 619 536 47 44 29 27
Dana Commercial Credit - - - - 28 28
Other 295 92 (141) (181) (149) (193)
Total Operations 9,915 9,601 903 657 534 375
Restructuring and
nonrecurring items - - (31) 63 (21) 43
Consolidated $9,915 $9,601 $872 $720 $513 $418
North America $7,760 $7,410 $955 $731 $602 $462
Europe 1,553 1,501 82 69 47 41
South America 418 427 11 20 14 16
Asia Pacific 184 263 (3) 6 (2) 4
Dana Commercial Credit - - - - 28 28
Other - - (142) (169) (155) (176)
Total Operations 9,915 9,601 903 657 534 375
Restructuring and
nonrecurring items - - (31) 63 (21) 43
Consolidated $9,915 $9,601 $872 $720 $513 $418
Dana Corporation
Quarterly Financial Information
For Nine Months Ending September 30, 2000 (Unaudited)
(in millions)
Net Profit Net Assets
99 00 99 00
Automotive Systems Group $209 $171 $1,834 $2,041
Automotive Aftermarket Group 105 24 1,970 2,032
Heavy Truck Group 69 51 688 594
Engine Systems Group 42 40 1,181 1,111
Fluid Systems Group 49 39 763 700
Off-Highway Systems Group 20 17 559 434
Dana Commercial Credit 28 28 140 168
Other 12 5 189 76
Total Operations 534 375 7,324 7,156
Restructuring and
nonrecurring items (21) 43 - -
Consolidated $513 $418 $7,324 $7,156
North America $484 $330 $5,242 $5,015
Europe 20 12 1,359 1,338
South America 6 8 599 508
Asia Pacific (9) (5) 140 175
Dana Commercial Credit 28 28 140 168
Other 5 2 (156) (48)
Total Operations 534 375 7,324 7,156
Restructuring and
nonrecurring items (21) 43 - -
Consolidated $513 $418 $7,324 $7,156
See Note 13 to Dana's 1999 Annual Report for further information
( http://WWW.Dana.Com )
SOURCE Dana Corporation
Web Site: http://www.dana.com
Photo Notes: http://www.newscom.com/cgi-bin/prnh/19990903/DANA
Company News On Call: Company News On-Call:
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