Dana Says Earnings Reflect Commercial-Sector Slowdown
Commercial vehicle supplier Dana Holdings Corp. said revenues slipped to $1.5 billion in the first quarter ended March 31 compared with $1.6 billion a year earlier.
Net income fell to $45 million, or 30 cents per diluted share, compared with $63 million, or 38 cents in the 2015 period. Weaker international currencies accounted for $10 million of this decrease, with the remaining $18 million decline resulting primarily from weaker commercial-vehicle and off-highway market demand, Dana said.
The company said foreign-currency translation lowered sales by $72 million.
Also, currency-adjusted sales were lower in 2016, reflecting weaker market demand in the commercial-vehicle and off-highway segments, it said.
Sales of its commercial vehicle driveline technologies slid to $333 million, compared with $433 million in 2015, it said.
At the same time, lower volumes reduced sales by $79 million, primarily due to higher share with a key customer in the first half of last year, weaker Class 8 production in North America this year and weaker demand in Brazil, where medium- and heavy-truck production was down 35% from first-quarter 2015, Dana said. Foreign currency — principally a weaker Brazilian real — lowered sales by an additional $20 million.
The commercial-vehicle segment earnings before interest, taxes, depreciation and amortization for the first quarter was $26 million, $9 million lower than 2015, resulting in a margin of 7.8%, the company said. But the segment’s EBITDA improved by $8 million, primarily from cost savings associated with the supplier-transition initiative completed in 2015 and the elimination of premium freight costs incurred in last year's first quarter, the company said.
Looking ahead toward additional business, Dana said it had won “major new business” with a full product line of steer axle modules, drive axle modules and driveshafts for the 2018 Isuzu FTR, an all-new entry in the Class 6 medium-duty truck segment.
