Allison Reports Lower Net Income, Revenue in Q1
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Allison Transmission Holdings Inc. reported lower net income and revenue for the first quarter amid progress in addressing the COVID-19 pandemic.
For the period ended March 31, net income fell to $120 million, or $1.07 per diluted share, compared with $139 million, or $1.20, a year earlier.
Revenue dropped to $588 million compared with $637 million a year earlier.
“So much progress has been made in addressing the effects of the pandemic,” Allison CEO David Graziosi said, “and there’s good reason to be optimistic, the risks persist, and our top priority remains the health and well-being of Allison’s extended family and its communities.”
The Indianapolis-based company reported higher revenue in only two business segments: defense and on-highway outside of North America.
“We are pleased to report that Allison’s first-quarter results reflect the ongoing global economic recovery, thanks to improving customer demand, a resilient outlook and the efforts of the Allison team to maintain operational alacrity and meet our commitments,” Graziosi said during an earnings call.
The company increased its quarterly dividend to 19 cents from 17 cents.
Allison announced it was raising its guidance on full-year results. It anticipates net income in the range of $395 million to $465 million, up from prior expectation of $375 million to $445 million. It expects revenue to rise 15% compared with 2020.
“The guidance update takes into account the continuation of supply chain challenges for the foreseeable future,” Chief Financial Officer G. Frederick Bohley said during the call.
He added: “Our 2021 net sales guidance reflects higher demand in the Global On-Highway Service Parts, Support Equipment & Other, and North America Off-Highway end markets as a result of the ongoing global economic recovery and price increases on certain products.”
As for segment results, Allison reported:
North America On-Highway revenue, $319 million, was down 9% from the same period in 2020 due to the continued effects of the pandemic, and up 12% on a sequential basis, principally driven by improving demand for last-mile delivery, regional haul and vocational trucks.
North America Off-Highway revenue, $2 million, was down $6 million compared with a year earlier, principally driven by lower demand for hydraulic fracturing applications and up $1 million sequentially.
Defense end market revenue, $45 million, rose 13% compared with a year earlier and by 2% on a sequential basis, in both cases principally driven by higher demand for tracked vehicle applications.
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Outside North America On-Highway revenue, $84 million, increased 17% from the same period in 2020 and by 9% sequentially, in both cases principally driven by higher demand in Asia.
Outside North America Off-Highway revenue, $16 million, fell $11 million compared with a year earlier and rose by $5 million on a sequential basis, in both cases principally driven by fluctuations in demand in the energy sector.
Service Parts, Support Equipment & Other revenue, $122 million, was down 12% compared with a year earlier principally driven by lower demand for North America service parts, and up 3% sequentially principally driven by higher demand for aluminum die cast component volume, support equipment and North America Off-Highway service parts.
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