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Two key suppliers to the commercial vehicle industry reported fourth-quarter results that reflected the effects of the ongoing coronavirus pandemic.
Allison Transmission Holdings Inc. reported lower net income and revenue while Dana Inc. posted lower net income and slightly increased revenue.
Allison said net income for the period ended Dec. 31 was $60 million, or 53 cents per diluted share, compared with $107 million, 90 cents, a year earlier.
“Severe disruptions to the global economy as a result of the ongoing pandemic led to substantial volatility in demand and considerable supply chain constraints,” Allison CEO David Graziosi said in a release.
“Despite these challenges, Allison was able to maintain the uninterrupted delivery of our products, and the generation of earnings and positive cash flow thanks to the unrelenting commitment, dedication and resilience of Allison’s employees, customers and suppliers.”
The company raised its quarterly dividend to 19 cents per share from 17 cents.
Revenue in the quarter dropped to $535 million compared with $617 million in the 2019 period.
Quarterly revenue in its North America on-highway segment, its largest, fell 14% in the quarter to $284 million compared with $330 million a year earlier.
On a sequential basis, the segment posted a 1% gain over the third quarter as the ongoing economic rebound, coupled with improving retail sales and strong year-end order activity, generated improved demand for both medium-duty and Class 8 straight trucks, according to the Indianapolis-based company.
Revenue in its service parts, support equipment and other segment, its second largest, fell 13% to $118 million compared with $135 million in the 2019 period.
Allison’s only increase in revenue was in its defense segment. That rose 5%, or $2 million, to $44 million.
For the full year, net income was $299 million, or $2.62, on revenue of $2 billion. A year earlier, net income was $604 million, or $4.91, on revenue of $2.6 billion.
Aggressive cost management practices and ongoing funding of engineering research and development and capital expenditures have positioned the company, Graziosi said, for “meaningful growth opportunities that lie ahead.”
Allison is the world’s largest manufacturer of fully automatic transmissions for medium- and heavy-duty commercial vehicles and medium- and heavy-tactical U.S. defense vehicles. It also supplies commercial vehicle propulsion solutions, including electric hybrid and fully electric propulsion systems.
As for Dana, net income for the quarter ended Dec. 31 was $39 million, or 27 cents, compared with $86 million, or 58 cents, in the same 2019 period.
It reinstated its quarterly dividend of 10 cents per share.
Revenue increased to $2.1 billion. It was $1.9 billion a year earlier. The improvement was driven by strong customer demand and the conversion of sales backlog, primarily in the light vehicle segment, according to the Maumee, Ohio-based company.
Dana emphasized the company’s position in the growing role projected for electric vehicles.
“We also further secured our leadership position in the e-mobility space with 50% of our $700 million new business backlog coming from electric or hybrid programs, demonstrating our promise to lead in this fast-growing segment,” Dana Chairman and CEO James Kamsickas said in a release.
“Our success in rapidly penetrating the electric-vehicle market is a direct result of our strategy and the investments we have made over the past several years,” he said. “As we move forward, we are well-positioned to capitalize on our momentum and realize the potential of our business.”
Its power technologies unit’s revenue in the quarter rose to $264 million compared with $244 million a year earlier.
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Revenue in its commercial vehicle segment, the company’s third-largest, slipped to $334 million compared with $345 million a year earlier.
Off-highway revenue fell to $530 million compared with $552 million a year earlier.
The light-vehicle segment, the largest, posted revenue of $980 million compared with $846 million in the 2019 period.
For the full year, the company posted a net loss of $51 million, or a loss of 21 cents, compared with net income of $233 million, $1.56, a year earlier.
The loss resulted mainly from the goodwill impairment charge recorded during the onset of the global pandemic, the company reported.
Annual revenue was $7.1 billion compared with $8.6 billion a year earlier.
Dana is a supplier to light vehicles, commercial vehicles and off-highway equipment. Its products enable the propulsion of conventional, hybrid and electric-powered vehicles, and it equips its customers with drive and motion systems; electrodynamic technologies; and thermal, sealing and digital solutions.
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