Supplier Dana Inc. reported record full-year net income and revenue, and quarterly improvements in both areas.
Net income for the quarter ended Dec. 31 was $100 million, or 69 cents per diluted share, on revenue of $1.97 billion. That compared with a net loss of $104 million, or a loss of 74 cents, on revenue of $1.83 billion a year earlier.
The rise in net income primarily was due to a $186 million charge related to the enactment of the Tax Cuts and Jobs Act in the fourth quarter of 2017 and increased operating earnings associated with higher sales in the fourth quarter of 2018, according to the Maumee, Ohio-based company.
The increase in revenue largely was attributable to higher end-market demand in all business units, conversion of sales backlog and favorable currency translation.
In the quarter, commercial vehicle sales — Dana’s third-largest business segment — climbed to $395 million from $355 million a year earlier.
“We had a spectacular year supporting our commercial vehicle customers, and they’ve rewarded us for that. But it cost us quite a bit of money in premium transportation to get parts from around the world to where we needed to make sure that we were predicting their lines and enabled them to be able to keep their assembly lines running,” Dana CEO James Kamsickas said during the latest earnings call.
He said the company has been positioned to be energy-source agnostic. “So we’re OK if they go with the internal combustion engine, if they go with full electric or they do — you know, they go hybrid in between. There’s certainly plenty of activity, but it is like we’ve always said, it’s further out in the cycle.”
Dana also has a significant presence in medium-duty and commercial vehicle aftermarket, Chief Financial Officer Jonathan Collins said during the call. “And the margins in both of those businesses are more attractive than the heavy vehicle over the road.”
For the full year, Dana achieved record annual sales, profit and profit margin performance of 11.8%, and increased adjusted free cash flow to $243 million, up about 50% from a year earlier, according to the company.
“Through the outstanding efforts and commitment of our associates and the support of our customers, we have achieved exceptional results and expect to continue this strong trajectory in 2019, including increasing sales by nearly $1 billion for the third consecutive year,” Kamsickas said in the earnings release.
Full-year net income was $427 million, or $2.91, on revenue of $8.1 billion. That compared with net income of $111 million, or 71 cents, on revenue of $7.2 billion.
For the 12-month period, commercial vehicle sales reached $1.6 billion compared with $1.4 billion a year earlier.
Dana’s commercial vehicle offerings include axles, tire pressure management, seals, gaskets, engine oil cooling and exhaust gas heat recovery.
Dana, founded in 1904, has more than 30,000 employees in 33 countries on six continents.