- Sales of $2.7 billion, an
increase of $91 million
- Net income of $3 million,
including a $29 million charge
related to the announced European hydraulics business
divestiture
- Adjusted EBITDA of $223
million, an increase of $19
million over last year
- Adjusted EBITDA margin of 8.2 percent, a 50-basis-point
improvement compared with 2023
- Operating cash flow improved by $68
million compared with last year
- Full-year 2024 free cash flow guidance raised by
$25 million
MAUMEE,
Ohio, April 30, 2024 /PRNewswire/ -- Dana
Incorporated (NYSE: DAN) today announced financial results for the
first quarter of 2024.
"Dana delivered strong performance in the first quarter with
improved sales, profit margins, and free cash flow over the
previous year. Consistent with the past several quarters, stable
demand in key markets and company-wide efficiency improvements
again drove strong profit growth. We achieved 39 percent profit
conversion on traditional organic sales in the quarter. This
performance is well above our historical conversion for the first
quarter and positions the company on a strong trajectory to achieve
our full-year targets," said James
Kamsickas, Dana chairman and chief executive
officer.
He added, "The Dana team is executing our core business and
operating systems at a very high level, which is continuing to
drive exceptional customer satisfaction that supports market share
gains and our new business backlog, including traditional ICE,
hybrid, and EV programs."
Sales for the first quarter of 2024 totaled $2.74 billion, compared with $ 2.64 billion in the same period of
2023.
Adjusted EBITDA for the first quarter of 2024 was
$223 million, compared with $204
million for the same period in 2023. Company-wide
efficiency improvements continue to offset the margin impact of
inflation and spending on development for electric-vehicle
products.
Net income attributable to Dana was $3
million, or $0.02 per
share, compared with $28 million, or
$0.19 per share, in the first quarter
of 2023. During the first quarter of 2024, Dana entered into a
definitive agreement to sell its European Off-Highway non-core
hydraulics business for approximately $40
million. This business is classified as held for sale, and a
$29 million loss was recognized to
adjust the carrying value of net assets to fair value, less
estimated costs to sell. Combined with European valuation
allowances of $7 million triggered by
the pending sale, the impact of the transaction was $0.25 per share. The sale is expected to
close during the second quarter of 2024.
Operating cash flow in the first quarter of 2024 was a use of
$102 million, compared with a use of $170 million in the same period of 2023.
Free cash flow was a use of $172
million, compared with a use of $290
million in the first quarter of 2023, an improvement of
$118 million.
"Our ongoing efforts to manage working capital have begun to
show results as we have significantly improved free cash flow in
the first quarter. Our ability to raise full-year guidance
for free cash flow is attributed to improved working capital
efficiency," said Timothy Kraus,
Dana senior vice president and chief financial officer.
Revised 2024 Financial Targets
- Sales of $10.65 to $11.15 billion;
- Adjusted EBITDA of $875 to
$975 million, an implied adjusted
EBITDA margin of approximately 8.5 percent at the midpoint of the
range;
- Operating cash flow of approximately $500 to $550
million; and
- Free cash flow of $50 to
$100 million;
- Diluted EPS of $0.35 to
$0.85.
Dana to Host Conference Call at 10
a.m., Tuesday, April
30
Dana will discuss its first-quarter results in a conference call at
10 a.m. EDT on Tuesday, April
30. The conference call can be accessed by telephone from
both domestic and international locations using the information
provided below:
Conference ID: 9943139
Participant Toll-Free Dial-In Number: 1 (888) 440-5873
Participant Toll Dial-In Number: 1 (646) 960-0319
Audio streaming and slides will be available online via a link
provided on the Dana investor website:
www.dana.com/investors. Phone registration will be available
beginning at 9:30 a.m. EDT.
A webcast replay can be accessed via Dana's investor website
following the call.
Non-GAAP Financial Information
Adjusted EBITDA is a
non-GAAP financial measure which we have defined as net income
(loss) before interest, income taxes, depreciation, amortization,
equity grant expense, restructuring expense, non-service cost
components of pension and other postretirement benefit costs and
other adjustments not related to our core operations (gain/loss on
debt extinguishment, pension settlements, divestitures, impairment,
etc.). Adjusted EBITDA is a measure of our ability to maintain and
continue to invest in our operations and provide shareholder
returns. We use adjusted EBITDA in assessing the effectiveness of
our business strategies, evaluating and pricing potential
acquisitions and as a factor in making incentive compensation
decisions. In addition to its use by management, we also believe
adjusted EBITDA is a measure widely used by securities analysts,
investors and others to evaluate financial performance of our
company relative to other Tier 1 automotive suppliers. Adjusted
EBITDA should not be considered a substitute for earnings (loss)
before income taxes, net income (loss) or other results reported in
accordance with GAAP. Adjusted EBITDA may not be comparable to
similarly titled measures reported by other companies.
Free cash flow is a non-GAAP financial measure which we have
defined as net cash provided by (used in) operating activities less
purchases of property, plant and equipment. We believe free
cash flow is useful to investors in evaluating the operational cash
flow of the company inclusive of the spending required to maintain
the operations. Free cash flow is not intended to represent
nor be an alternative to the measure of net cash provided by (used
in) operating activities reported in accordance with GAAP.
Free cash flow may not be comparable to similarly titled measures
reported by other companies.
The accompanying financial information provides reconciliations
of adjusted EBITDA and free cash flow to the most directly
comparable financial measures calculated and presented in
accordance with GAAP. We have not provided a reconciliation of our
adjusted EBITDA outlook to the most comparable GAAP measure of net
income (loss). Providing net income (loss) guidance is potentially
misleading and not practical given the difficulty of projecting
event driven transactional and other non-core operating items that
are included in net income (loss), including restructuring actions,
asset impairments and certain income tax adjustments. The
accompanying reconciliation of adjusted EBITDA to net income (loss)
for the historical periods presented are indicative of the
reconciliation that will be prepared upon completion of the periods
covered by the non-GAAP guidance.
Forward-Looking Statements
Certain statements and
projections contained in this news release are, by their nature,
forward-looking within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking
statements are based on our current expectations, estimates, and
projections about our industry and business, management's beliefs,
and certain assumptions made by us, all of which are subject to
change. Forward-looking statements can often be identified by
words such as "anticipates," "expects," "intends," "plans,"
"predicts," "believes," "seeks," "estimates," "may," "will,"
"should," "would," "could," "potential," "continue," "ongoing," and
similar expressions, and variations or negatives of these
words. These forward-looking statements are not guarantees of
future results and are subject to risks, uncertainties, and
assumptions that could cause our actual results to differ
materially and adversely from those expressed in any
forward-looking statement.
Dana's Annual Report on Form 10-K, subsequent Quarterly Reports
on Form 10-Q, recent Current Reports on Form 8-K, and other
Securities and Exchange Commission filings discuss important risk
factors that could affect our business, results of operations and
financial condition. The forward-looking statements in this
news release speak only as of this date. Dana does not undertake
any obligation to revise or update publicly any forward-looking
statement for any reason.
About Dana Incorporated
Dana is a leader in the design
and manufacture of highly efficient propulsion and
energy-management solutions that power vehicles and machines in all
mobility markets across the globe. The company is shaping
sustainable progress through its conventional and clean-energy
solutions that support nearly every vehicle manufacturer with drive
and motion systems; electrodynamic technologies, including software
and controls; and thermal, sealing, and digital solutions.
Based in Maumee, Ohio, USA, the
company reported sales of $10.6
billion in 2023 with 42,000 people in 31 countries across
six continents. With a history dating to 1904, Dana was named among
the "World's Most Ethical Companies" for 2023 and 2024 by
Ethisphere and as one of "America's Most Responsible Companies
2023" by Newsweek. The company is driven by a
high-performance culture that focuses on valuing others, inspiring
innovation, growing responsibly, and winning together, earning it
global recognition as a top employer. Learn more at dana.com.
DANA
INCORPORATED
|
Consolidated
Statement of Operations (Unaudited)
|
For the Three
Months Ended March 31, 2024 and 2023
|
|
|
|
|
Three Months
Ended
|
(In millions,
except per share amounts)
|
|
March 31,
|
|
|
|
2024
|
|
2023
|
Net
sales
|
|
|
$
2,735
|
|
$
2,644
|
Costs and
expenses
|
|
|
|
|
Cost of
sales
|
|
2,491
|
|
2,415
|
Selling, general and
administrative expenses
|
|
139
|
|
140
|
Amortization of
intangibles
|
|
3
|
|
3
|
Restructuring charges,
net
|
|
5
|
|
1
|
Loss on disposal
group held for sale
|
|
(29)
|
|
|
Other income
(expense), net
|
|
2
|
|
5
|
Earnings before
interest and income taxes
|
|
70
|
|
90
|
Interest
income
|
|
4
|
|
4
|
Interest
expense
|
|
39
|
|
34
|
Earnings before
income taxes
|
|
35
|
|
60
|
Income tax
expense
|
|
37
|
|
30
|
Equity in
earnings of affiliates
|
|
2
|
|
1
|
Net
income
|
|
-
|
|
31
|
Less: Noncontrolling
interests net income
|
|
5
|
|
4
|
Less: Redeemable
noncontrolling interests net loss
|
|
(8)
|
|
(1)
|
Net income
attributable to the parent company
|
|
$
3
|
|
$ 28
|
|
|
|
|
|
|
Net income per
share available to common stockholders
|
|
|
|
|
Basic
|
|
|
$
0.02
|
|
$
0.19
|
Diluted
|
|
|
$
0.02
|
|
$
0.19
|
|
|
|
|
|
|
Weighted-average
shares outstanding - Basic
|
|
144.8
|
|
143.9
|
Weighted-average
shares outstanding - Diluted
|
|
144.8
|
|
144.3
|
DANA
INCORPORATED
|
Consolidated
Statement of Comprehensive Income (Unaudited)
|
For the Three
Months Ended March 31, 2024 and 2023
|
|
|
|
|
|
|
Three Months
Ended
|
(In
millions)
|
|
March 31,
|
|
|
|
|
|
2024
|
|
2023
|
Net
income
|
|
$ -
|
|
$ 31
|
Other
comprehensive income (loss), net of tax:
|
|
|
|
|
|
Currency translation
adjustments
|
|
(20)
|
|
25
|
|
Hedging gains and
losses
|
|
(2)
|
|
15
|
|
Defined benefit
plans
|
|
1
|
|
1
|
|
Other comprehensive
income (loss)
|
|
(21)
|
|
41
|
Total comprehensive
income (loss)
|
|
(21)
|
|
72
|
|
Less: Comprehensive
income attributable to noncontrolling interests
|
|
(4)
|
|
(4)
|
|
Less: Comprehensive
loss attributable to redeemable noncontrolling interests
|
|
11
|
|
|
Comprehensive income
(loss) attributable to the parent company
|
|
$ (14)
|
|
$ 68
|
DANA
INCORPORATED
|
Consolidated
Balance Sheet (Unaudited)
|
As of March
31, 2024 and December 31, 2023
|
|
(In millions,
except share and per share amounts)
|
|
March 31,
|
|
December 31,
|
|
|
2024
|
|
2023
|
Assets
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$ 351
|
|
$
529
|
Accounts
receivable
|
|
|
|
|
Trade, less allowance for doubtful accounts of $14 in 2024
and $16 in 2023
|
|
1,526
|
|
1,371
|
Other
|
|
251
|
|
280
|
Inventories
|
|
1,625
|
|
1,676
|
Other current
assets
|
|
287
|
|
247
|
Current assets of
disposal group held for sale
|
|
62
|
|
|
Total current assets
|
|
4,102
|
|
4,103
|
Goodwill
|
|
257
|
|
263
|
Intangibles
|
|
169
|
|
182
|
Deferred tax
assets
|
|
507
|
|
516
|
Other noncurrent
assets
|
|
158
|
|
140
|
Investments in
affiliates
|
|
123
|
|
123
|
Operating lease
assets
|
|
315
|
|
327
|
Property, plant
and equipment, net
|
|
2,226
|
|
2,311
|
Total assets
|
|
$
7,857
|
|
$
7,965
|
|
|
|
|
|
Liabilities,
redeemable noncontrolling interests and equity
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Short-term
debt
|
|
$
39
|
|
$
22
|
Current portion
of long-term debt
|
|
8
|
|
35
|
Accounts
payable
|
|
1,697
|
|
1,756
|
Accrued payroll
and employee benefits
|
|
316
|
|
288
|
Taxes on
income
|
|
90
|
|
86
|
Current portion
of operating lease liabilities
|
|
41
|
|
42
|
Other accrued
liabilities
|
|
352
|
|
373
|
Current
liabilities of disposal group held for sale
|
|
22
|
|
|
Total current liabilities
|
|
2,565
|
|
2,602
|
Long-term debt,
less debt issuance costs of $23 in 2024 and $24 in
2023
|
|
2,580
|
|
2,598
|
Noncurrent
operating lease liabilities
|
|
271
|
|
284
|
Pension and
postretirement obligations
|
|
318
|
|
334
|
Other noncurrent
liabilities
|
|
318
|
|
319
|
Noncurrent
liabilities of disposal group held for sale
|
|
4
|
|
|
Total liabilities
|
|
6,056
|
|
6,137
|
Commitments and contingencies
|
|
|
|
|
Redeemable
noncontrolling interests
|
|
197
|
|
191
|
Parent company
stockholders' equity
|
|
|
|
|
Preferred stock, 50,000,000 shares authorized, $0.01 par
value,
|
|
|
|
|
no shares outstanding
|
|
-
|
|
-
|
Common stock, 450,000,000 shares authorized, $0.01 par
value,
|
|
|
|
|
144,954,645 and 144,386,484 shares
outstanding
|
|
2
|
|
2
|
Additional paid-in capital
|
|
2,260
|
|
2,255
|
Retained earnings
|
|
297
|
|
317
|
Treasury stock, at cost (821,207 and 474,981
shares)
|
|
(13)
|
|
(9)
|
Accumulated other comprehensive loss
|
|
(1,007)
|
|
(990)
|
Total parent company stockholders'
equity
|
|
1,539
|
|
1,575
|
Noncontrolling
interests
|
|
65
|
|
62
|
Total equity
|
|
1,604
|
|
1,637
|
Total liabilities, redeemable noncontrolling
interests and equity
|
|
$
7,857
|
|
$
7,965
|
DANA
INCORPORATED
|
Consolidated
Statement of Cash Flows (Unaudited)
|
For the Three
Months Ended March 31, 2024 and 2023
|
|
|
|
|
Three Months
Ended
|
(In
millions)
|
|
March 31,
|
|
|
|
2024
|
|
2023
|
Operating
activities
|
|
|
|
|
Net
income
|
|
$
-
|
|
$
31
|
Depreciation
|
|
101
|
|
92
|
Amortization
|
|
5
|
|
5
|
Amortization of
deferred financing charges
|
|
1
|
|
1
|
Earnings of
affiliates, net of dividends received
|
|
(2)
|
|
(1)
|
Stock
compensation expense
|
|
6
|
|
6
|
Deferred income
taxes
|
|
2
|
|
(8)
|
Pension expense,
net
|
|
(7)
|
|
|
Change in working
capital
|
|
(251)
|
|
(304)
|
Loss on disposal
group held for sale
|
|
29
|
|
|
Other,
net
|
|
14
|
|
8
|
Net cash used
in operating activities
|
|
(102)
|
|
(170)
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
(70)
|
|
(120)
|
Proceeds from
sale of property, plant and equipment
|
|
4
|
|
2
|
Settlements of
undesignated derivatives
|
|
(1)
|
|
|
Other,
net
|
|
4
|
|
|
Net cash used
in investing activities
|
|
(63)
|
|
(118)
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
Net change in
short-term debt
|
|
17
|
|
269
|
Repayment of
long-term debt
|
|
(27)
|
|
(2)
|
Deferred
financing payments
|
|
|
|
(2)
|
Dividends paid to
common stockholders
|
|
(15)
|
|
(15)
|
Distributions to
noncontrolling interests
|
|
(3)
|
|
(1)
|
Contributions
from redeemable noncontrolling interests
|
|
9
|
|
10
|
Collection of
note receivable from noncontrolling interest
|
|
11
|
|
|
Other,
net
|
|
9
|
|
(4)
|
Net cash
provided by financing activities
|
|
1
|
|
255
|
|
|
|
|
|
|
Net decrease
in cash, cash equivalents and restricted cash
|
|
(164)
|
|
(33)
|
Cash, cash
equivalents and restricted cash − beginning of
period
|
|
563
|
|
442
|
Effect of
exchange rate changes on cash balances
|
|
(12)
|
|
10
|
Cash, cash
equivalents and restricted cash − end of
period
|
|
$
387
|
|
$
419
|
DANA
INCORPORATED
|
Reconciliation
of Net Cash Provided By (Used In) Operating Activities
to
|
Free
Cash Flow (Unaudited)
|
|
|
|
Three Months
Ended
|
(In
millions)
|
|
March 31,
|
|
|
2024
|
|
2023
|
Net cash used
in operating activities
|
|
$
(102)
|
|
$
(170)
|
Purchase of
property, plant and equipment
|
|
(70)
|
|
(120)
|
Free cash
flow
|
|
$
(172)
|
|
$
(290)
|
DANA
INCORPORATED
|
Segment Sales
and Segment EBITDA (Unaudited)
|
For the Three
Months Ended March 31, 2024 and 2023
|
|
|
|
Three Months
Ended
|
(In
millions)
|
|
March 31,
|
|
|
2024
|
|
2023
|
Sales
|
|
|
|
|
Light
Vehicle
|
|
$
1,098
|
|
$
962
|
Commercial
Vehicle
|
|
524
|
|
522
|
Off-Highway
|
|
781
|
|
842
|
Power
Technologies
|
|
332
|
|
318
|
Total
Sales
|
|
$
2,735
|
|
$
2,644
|
|
|
|
|
|
Segment
EBITDA
|
|
|
|
|
Light
Vehicle
|
|
$ 67
|
|
$ 49
|
Commercial
Vehicle
|
|
17
|
|
17
|
Off-Highway
|
|
115
|
|
118
|
Power
Technologies
|
|
27
|
|
23
|
Total Segment
EBITDA
|
|
226
|
|
207
|
Corporate expense
and other items, net
|
|
(3)
|
|
(3)
|
Adjusted
EBITDA
|
|
$
223
|
|
$
204
|
DANA
INCORPORATED
|
Reconciliation
of Segment and Adjusted EBITDA to Net Income
(Unaudited)
|
For the Three
Months Ended March 31, 2024 and 2023
|
|
|
|
Three Months
Ended
|
(In
millions)
|
|
March 31,
|
|
|
2024
|
|
2023
|
Segment
EBITDA
|
|
$
226
|
|
$
207
|
Corporate expense
and other items, net
|
|
(3)
|
|
(3)
|
Adjusted
EBITDA
|
|
223
|
|
204
|
Depreciation
|
|
(101)
|
|
(92)
|
Amortization
|
|
(5)
|
|
(5)
|
Non-service cost
components of pension and OPEB costs
|
|
(4)
|
|
(3)
|
Restructuring
charges, net
|
|
(5)
|
|
(1)
|
Stock
compensation expense
|
|
(6)
|
|
(6)
|
Strategic
transaction expenses
|
|
(2)
|
|
(1)
|
Distressed
supplier costs
|
|
|
|
(8)
|
Loss on disposal
group held for sale
|
|
(29)
|
|
|
Other
items
|
|
(1)
|
|
2
|
Earnings before
interest and income taxes
|
|
70
|
|
90
|
Interest
income
|
|
4
|
|
4
|
Interest
expense
|
|
39
|
|
34
|
Earnings before
income taxes
|
|
35
|
|
60
|
Income tax
expense
|
|
37
|
|
30
|
Equity in
earnings of affiliates
|
|
2
|
|
1
|
Net
income
|
|
$
-
|
|
$
31
|
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SOURCE Dana Incorporated