DCN Dana Cp

Dana Corporation Reports Fourth-Quarter and Full-Year Results Aftermarket Divestiture and Related Actions Improve Balance Sheet, Cost Structure TOLEDO, Ohio, Feb. 23 /PRNewswire-FirstCall/ -- Dana Corporation (NYSE:DCN) today announced its fourth-quarter and full-year 2004 results. During the fourth quarter, Dana took a series of actions aimed at strengthening its long-term competitiveness and repositioning the company to better serve its global original equipment customers. These actions, which together resulted in unusual charges of $195 million after tax, included: - Completing the divestiture of the automotive aftermarket businesses previously held for sale; - Announcing two facility closures and other manufacturing realignments; and - Repurchasing approximately $900 million of long-term debt. (Logo: http://www.newscom.com/cgi-bin/prnh/19990903/DANA ) "The aftermarket divestiture, our realignment actions, and the debt repurchase significantly improved our balance sheet and financial flexibility. Our efforts were recognized by two leading credit agencies, which returned us to investment grade in December," said Dana Chairman and CEO Mike Burns. "In addition, year-over-year sales and net income, excluding unusual items, were both up significantly despite a challenging operating environment. "Certainly, we're not yet where we'd like to be. But the improvements to our balance sheet and operational performance were important steps in the continuing transformation of Dana, and I am proud of what our people accomplished in 2004." Financial Summary (in millions, except earnings 4th Quarter Full Year per share) 2004 2003 2004 2003 Net sales $2,300 $2,050 $9,056 $7,918 Net income (loss) Net income, excluding unusual items $62 $62 $262 $183 Divestiture gains (losses), net (50) 6 (30) 30 Realignment costs (49) - - - (54) - - - Debt repurchase gains (losses) (96) - - - (96) 9 Net income (loss) $(133) $68 $82 $222 Income (loss) from continuing operations $(83) $56 $95 $175 Income (loss) from discontinued operations (50) 12 (13) 47 Net income (loss) $(133) $68 $82 $222 Diluted earnings per share Net income, excluding unusual items $0.41 $0.41 $1.73 $1.23 Net income (loss) $(0.89) $0.45 $0.54 $1.49 Fourth-Quarter Results Dana posted fourth-quarter sales of $2.3 billion in 2004, compared to $2.1 billion in the same period of 2003. This increase was primarily due to new business and strong sales to commercial vehicle customers, while favorable currency effects added $73 million. Including unusual charges for the aftermarket divestiture, manufacturing realignments, and debt repurchase, Dana recorded a net loss of $133 million, or 89 cents per share, in the quarter, compared to net income of $68 million, or 45 cents per share, in the same period of 2003. Excluding unusual charges, net income for the quarter was $62 million in 2004, compared to the same amount in the fourth quarter of 2003. Earnings in the fourth quarter were negatively impacted by the continuing effects of higher raw material prices. Net of customer recoveries, the increased cost of steel alone reduced earnings by $31 million after tax, compared to the same period in 2003. Favorably impacting the 2004 results were tax benefits that resulted primarily from the company's ability to reduce valuation allowances provided against deferred tax assets in prior periods. Dana Vice President and Chief Financial Officer Bob Richter explained, "While reported income was greater than expected, this was largely due to greater than anticipated tax benefits. More important for the long term were the actions taken to strengthen our financial position. We improved our net debt-to-capital ratio, excluding Dana Credit Corporation, from 47 percent at the start of the quarter -- and 61 percent less than three years ago -- to less than 35 percent. This improvement will be reflected in reduced interest expense going forward. We also made an extra contribution of approximately $200 million to our pension plans, which will reduce future expense and contribution requirements. And, we are no longer limited by high-yield covenants on our debt. All of this will enable us to better capitalize on future growth opportunities." Full-Year Results Sales increased to $9.1 billion in 2004 from $7.9 billion in 2003, primarily due to net new business of over $400 million, strong commercial and off-highway vehicle markets, and favorable currency effects of $300 million. Full-year net income was $82 million, or 54 cents per share, compared to $222 million, or $1.49 per share, in 2003. Unusual items of $180 million in 2004 included the $195 million of charges recorded in the fourth quarter plus $15 million of net gains reported earlier in the year. Net income in 2003 included $39 million of unusual gains on divestitures and debt repurchases. Excluding unusual items, net income in 2004 was $262 million, or $1.73 per share, compared to $183 million, or $1.23 per share, in 2003. The margin on higher sales and benefits from the company's cost-reduction initiatives, as well as tax benefits, more than offset the impact of increased raw material costs. "Despite very challenging industry conditions, we made good progress year over year," said Burns. "We had to contend with increased steel costs, which net of recoveries was $70 million after tax, mostly in the second half of year. We also saw a small decline in North American light vehicle production. Fortunately, we had the benefit of new business, strong commercial and off- highway vehicle markets, and the early returns from our cost-reduction initiatives. In particular, during 2004, we consolidated our light vehicle business units and centralized our purchasing organization for greater buying leverage." 2005 Outlook "This will be another tough year for the automotive industry as well as Dana," said Burns. "We believe North American light vehicle production will be flat at 15.8 million units. We expect to see continuing pressure on raw material prices and energy costs, particularly in the first half of the year. And, as a company, we will also face the near-term challenge of replacing the lost earnings from the automotive aftermarket businesses that were sold, as well as the reduced earnings contribution from Dana Credit Corporation as we continue to wind that business down. "On the other hand, we have renewed our focus on our global original equipment manufacturers. In fact, we already have an additional $410 million in net new business, which comes on in 2005. And we're very optimistic about the outlook for the commercial vehicle and off-highway markets. We're anticipating a 13 percent increase in North American Class 8 truck production to 293,000 units. The combination of these factors should allow us to increase our 2005 full-year sales to $9.6 billion. "The increased sales alone, however, will not be enough to offset the challenges we face. So we will be relentless in pursuing our cost-reduction objectives. We will continue to deploy lean manufacturing and value engineering throughout the organization and streamline our administrative processes. These efforts, along with better leverage from our consolidated purchasing function, are expected to gain more momentum and therefore provide greater benefit to our bottom line as the year progresses. "We expect Dana's earnings to be lower in the first half of the year compared to last year mainly due to higher raw material prices. Therefore, we're anticipating first-quarter earnings of 17 to 23 cents per share. Our ability to achieve higher earnings in the second half of the year is largely dependent on the successful execution of our cost-reduction programs. At this time, our full-year earnings guidance is $1.40 to $1.62 per share," added Burns. Quarterly Conference Call Scheduled Today at 1 p.m. Dana will discuss its fourth-quarter and full-year results in a conference call at 1 p.m. (EST) today. The call may be accessed via Dana's web site ( http://www.dana.com/ ), where it will be accompanied by a brief slide presentation, or by dialing (800) 275-3210. Please dial into the conference five minutes prior to the call. An audio recording of this conference call will be available after 6 p.m. today. To access this recording, please dial (800) 537-8823. A webcast replay of the call will be available after 6 p.m. today and will be accessible via the Dana web site. About Dana Corporation Dana people design and manufacture products for every major vehicle producer in the world. Dana is focused on being an essential partner to automotive, commercial, and off-highway vehicle customers, which collectively produce more than 60 million vehicles every year. A leading supplier of axle, driveshaft, engine, frame, chassis, and transmission technologies, Dana employs 46,000 people in 28 countries. The company is based in Toledo, Ohio, and reported sales of $9.1 billion in 2004. Dana's Internet address is: http://www.dana.com/ . Forward-Looking Statements Certain statements contained in this presentation constitute "forward- looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements represent Dana's expectations based on our current information and assumptions. Forward-looking statements are inherently subject to risks and uncertainties. Dana's actual results could differ materially from those that are anticipated or projected due to a number of factors. These factors include: national and international economic conditions; adverse effects from terrorism or hostilities; the strength of other currencies relative to the U.S. dollar; increases in commodity costs, including steel, that cannot be recouped in product pricing; our ability and that of our customers to achieve projected sales and production levels; the continued availability of necessary goods and services from our suppliers; competitive pressures on our sales and pricing; the continued success of our cost reduction and cash management programs, long-term transformation and U.S. tax loss carryforward utilization strategies; and other factors set out in our public filings with the Securities and Exchange Commission. Dana does not undertake to update any forward-looking statements in this presentation. Dana Corporation Financial Summary (Unaudited) (in millions, except per share amounts) Three Months Ended December 31 2004 2003 Sales $2,300 $2,050 Income (loss) from continuing operations $(83) $56 Income (loss) from discontinued operations (50) 12 Net income (loss) $(133) $68 Income (loss) from continuing operations $(83) $56 Net gains associated with DCC asset sales (2) (9) Loss on repurchase of notes 96 Realignment charges 49 Income from continuing operations, excluding unusual items $60 $47 Income (loss) from discontinued automotive aftermarket business $(50) $15 Losses of other discontinued operations (3) (50) 12 Sale of automotive aftermarket business 52 Charges related to sales of discontinued operations 3 Income from discontinued operations, excluding unusual items $2 $15 Diluted earnings per share: Income (loss) from continuing operations $(0.55) $0.37 Income (loss) from discontinued operations (0.34) 0.08 Net income (loss) $(0.89) $0.45 Income from continuing operations, excluding unusual items $0.40 $0.31 Income from discontinued operations, excluding unusual items 0.01 0.10 Net income, excluding unusual items 0.41 0.41 Unusual items (1.30) 0.04 Net income (loss) $(0.89) $0.45 Dana Corporation Financial Summary (Unaudited) (in millions, except per share amounts) Year Ended December 31 2004 2003 Sales $9,056 $7,918 Income from continuing operations $95 $175 Income (loss) from discontinued operations (13) 47 Net income $82 $222 Income from continuing operations $95 $175 Gain associated with the sale of assets to a newly formed joint venture (13) Net gains associated with DCC asset sales (22) (35) Loss (gain) on repurchase of notes 96 (9) Realignment charges 54 Income from continuing operations, excluding unusual items $210 $131 Income (loss) from discontinued automotive aftermarket business $(13) $58 Losses of other discontinued operations (11) Income (loss) from discontinued operations (13) 47 Loss on engine management sale 5 Sale of automotive aftermarket business 65 Income from discontinued operations, excluding unusual items $52 $52 Diluted earnings per share: Income from continuing operations $0.63 $1.17 Income (loss) from discontinued operations (0.09) 0.32 Net income $0.54 $1.49 Income from continuing operations, excluding unusual items $1.39 $0.88 Income from discontinued operations, excluding unusual items 0.34 0.35 Net income, excluding unusual items 1.73 1.23 Unusual items (1.19) 0.26 Net income $0.54 $1.49 Dana Corporation Condensed Statement of Income (Unaudited) (in millions, except per share amounts) Three Months Ended December 31 2004 2003 Net sales $2,300 $2,050 Revenue from lease financing and other income (expense) (98) 36 2,202 2,086 Costs and expenses Cost of sales 2,178 1,870 Realignment charges 66 5 Selling, general and administrative expenses 123 128 Interest expense 53 52 2,420 2,055 Income (loss) before income taxes (218) 31 Income tax benefit 118 15 Minority interest 1 (3) Equity in earnings of affiliates 16 13 Income (loss) from continuing operations (83) 56 Income (loss) from discontinued operations (50) 12 Net income (loss) $(133) $68 Basic earnings per share Income (loss) from continuing operations $(0.56) $0.37 Income (loss) from discontinued operations (0.34) 0.08 Net income (loss) $(0.90) $0.45 Diluted earnings per share Income (loss) from continuing operations $(0.55) $0.37 Income (loss) from discontinued operations (0.34) 0.08 Net income (loss) $(0.89) $0.45 Average shares outstanding - For Basic EPS 149 148 For Diluted EPS 151 150 Dana Corporation Condensed Statement of Income (Unaudited) (in millions, except per share amounts) Year Ended December 31 2004 2003 Net sales $9,056 $7,918 Revenue from lease financing and other income (expense) (66) 149 8,990 8,067 Costs and expenses Cost of sales 8,333 7,245 Realignment charges 72 Selling, general and administrative expenses 504 520 Interest expense 217 221 9,126 7,986 Income (loss) before income taxes (136) 81 Income tax benefit 196 49 Minority interest (8) (7) Equity in earnings of affiliates 43 52 Income from continuing operations 95 175 Income (loss) from discontinued operations (13) 47 Net income $82 $222 Basic earnings per share Income from continuing operations $0.64 $1.17 Income (loss) from discontinued operations (0.09) 0.32 Net income $0.55 $1.49 Diluted earnings per share Income from continuing operations $0.63 $1.17 Income (loss) from discontinued operations (0.09) 0.32 Net income $0.54 $1.49 Average shares outstanding - For Basic EPS 149 148 For Diluted EPS 151 149 Dana Corporation Condensed Balance Sheet (Unaudited) (in millions) December 31 December 31 Assets 2004 2003 Current assets Cash and cash equivalents $634 $731 Accounts receivable Trade 1,266 1,048 Other 444 326 Inventories 907 743 Assets of discontinued operations 1,254 Other current assets 217 431 Total current assets 3,468 4,533 Investment in leases 281 622 Investments and other assets 3,145 2,252 Property, plant and equipment, net 2,153 2,210 Total assets $9,047 $9,617 Liabilities and Shareholders' Equity Current liabilities Notes payable $155 $493 Accounts payable 1,317 1,076 Liabilities of discontinued operations 307 Other current liabilities 1,217 1,089 Total current liabilities 2,689 2,965 Long-term debt 2,054 2,605 Deferred employee benefits and other noncurrent liabilities 1,746 1,901 Minority interest 123 96 Shareholders' equity 2,435 2,050 Total liabilities and shareholders' equity $9,047 $9,617 Dana Corporation Condensed Statement of Cash Flows (Unaudited) (in millions) Three Months Ended December 31 2004 2003 Net income (loss) $(133) $68 Depreciation and amortization 88 100 Asset impairment 13 3 Loss (gain) on divestitures, asset sales and note repurchases 170 (18) Working capital decrease (increase) (174) 105 Other 155 (8) Net cash flows - operating activities 119 250 Purchases of property, plant and equipment (122) (90) Payments received on leases 5 Net loan repayments from customers 2 2 Divestitures 968 Asset sales 32 76 Other (45) 14 Net cash flows - investing activities 835 7 Net change in short-term debt (211) (104) Proceeds from long-term debt 450 Payments on and repurchases of long-term debt (1,052) (47) Dividends paid (20) (9) Other (1) 1 Net cash flows - financing activities (834) (159) Net change in cash and cash equivalents 120 98 Net change in cash - discontinued operations 2 (3) Cash and cash equivalents - beginning of period 512 636 Cash and cash equivalents - end of period $634 $731 Dana Corporation Condensed Statement of Cash Flows (Unaudited) (in millions) Year Ended December 31 2004 2003 Net income $82 $222 Depreciation and amortization 361 394 Asset impairment 37 21 Loss (gain) on divestitures, asset sales and note repurchases 113 (47) Working capital increase (587) (212) Other 49 (43) Net cash flows - operating activities 55 335 Purchases of property, plant and equipment (330) (305) Payments received on leases 8 26 Net loan repayments from customers 4 14 Divestitures 968 145 Asset sales 356 282 Other (66) 47 Net cash flows - investing activities 940 209 Net change in short-term debt (30) (113) Proceeds from long-term debt 455 Payments on and repurchases of long-term debt (1,457) (272) Dividends paid (73) (14) Other 9 17 Net cash flows - financing activities (1,096) (382) Net change in cash and cash equivalents (101) 162 Net change in cash - discontinued operations 4 (2) Cash and cash equivalents - beginning of period 731 571 Cash and cash equivalents - end of period $634 $731 Dana Corporation (Including Dana Credit Corporation on an Equity Basis) Condensed Statement of Income (Unaudited) (in millions) Three Months Ended December 31 2004 2003 Net sales $2,300 $2,050 Other income (expense) (121) 18 2,179 2,068 Costs and expenses Cost of sales 2,184 1,883 Realignment charges 66 5 Selling, general and administrative expenses 115 107 Interest expense 44 38 2,409 2,033 Income (loss) before income taxes (230) 35 Income tax benefit 117 2 Minority interest 1 (3) Equity in earnings of affiliates 29 22 Income (loss) from continuing operations (83) 56 Income (loss) from discontinued operations (50) 12 Net income (loss) $(133) $68 Dana Corporation (Including Dana Credit Corporation on an Equity Basis) Condensed Statement of Income (Unaudited) (in millions) Year Ended December 31 2004 2003 Net sales $9,056 $7,918 Other income (expense) (78) 91 8,978 8,009 Costs and expenses Cost of sales 8,361 7,293 Realignment charges 72 Selling, general and administrative expenses 472 447 Interest expense 172 160 9,077 7,900 Income (loss) before income taxes (99) 109 Income tax benefit (expense) 109 (20) Minority interest (8) (7) Equity in earnings of affiliates 93 93 Income from continuing operations 95 175 Income (loss) from discontinued operations (13) 47 Net income $82 $222 Dana Corporation (Including Dana Credit Corporation on an Equity Basis) Condensed Balance Sheet (Unaudited) (in millions) December 31 December 31 Assets 2004 2003 Current assets Cash and cash equivalents $619 $664 Accounts receivable Trade 1,266 1,048 Other 445 300 Inventories 907 743 Assets of discontinued operations 1,254 Other current assets 192 399 Total current assets 3,429 4,408 Investments and other assets 3,337 2,580 Property, plant and equipment, net 2,015 2,014 Total assets $8,781 $9,002 Liabilities and Shareholders' Equity Current liabilities Notes payable $289 $260 Accounts payable 1,317 1,076 Liabilities of discontinued operations 307 Other current liabilities 1,269 1,235 Total current liabilities 2,875 2,878 Long-term debt 1,611 2,087 Deferred employee benefits and other noncurrent liabilities 1,739 1,893 Minority interest 121 94 Shareholders' equity 2,435 2,050 Total liabilities and shareholders' equity $8,781 $9,002 Dana Corporation (Including Dana Credit Corporation on an Equity Basis) Cash Flow Impact on Net Debt (Unaudited) (in millions) Three Months Ended December 31 2004 2003 Sources Net income (loss) $(133) $68 Depreciation 82 88 Asset sales 27 45 Divestitures 968 Working capital decrease 90 147 1,034 348 Uses Capital spend (120) (86) Dividends (20) (9) Restructuring cash payments (15) (44) Additional pension contribution (198) Investment in and undistributed earnings of equity affiliates (49) 32 Net changes in other accounts 37 (17) (365) (124) Cash change in net debt $669 $224 Dana Corporation (Including Dana Credit Corporation on an Equity Basis) Cash Flow Impact on Net Debt (Unaudited) (in millions) Year Ended December 31 2004 2003 Sources Net income $82 $222 Depreciation 332 337 Asset sales 67 89 Divestitures 968 145 Working capital increase (261) (72) 1,188 721 Uses Capital spend (324) (295) Dividends (73) (14) Restructuring cash payments (80) (136) Additional pension contribution (198) Investment in and undistributed earnings of equity affiliates (129) (45) Net changes in other accounts (9) 41 (813) (449) Cash change in net debt $375 $272 Dana Corporation Condensed Consolidating Statement of Income (Unaudited) (in millions) Three Months Ended December 31, 2004 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Net sales $2,300 $ $ $2,300 Other income (expense) (121) 33 (10) (98) 2,179 33 (10) 2,202 Costs and expenses Cost of sales 2,184 (6) 2,178 Realignment charges 66 66 Selling, general and administrative expenses 115 11 (3) 123 Interest expense 44 10 (1) 53 2,409 21 (10) 2,420 Income (loss) before income taxes (230) 12 - (218) Income tax benefit 117 1 118 Minority interest 1 1 Equity in earnings of affiliates 29 3 (16) 16 Income (loss) from continuing operations (83) 16 (16) (83) Loss from discontinued operations (50) (50) Net income (loss) $(133) $16 $(16) $(133) This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts reported for Dana Corporation on a fully consolidated basis. Dana Corporation Condensed Consolidating Statement of Income (Unaudited) (in millions) Year Ended December 31, 2004 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Net sales $9,056 $ $ $9,056 Other income (expense) (78) 59 (47) (66) 8,978 59 (47) 8,990 Costs and expenses Cost of sales 8,361 (28) 8,333 Realignment charges 72 72 Selling, general and administrative expenses 472 49 (17) 504 Interest expense 172 47 (2) 217 9,077 96 (47) 9,126 Loss before income taxes (99) (37) - (136) Income tax benefit 109 87 196 Minority interest (8) (8) Equity in earnings of affiliates 93 7 (57) 43 Income from continuing operations 95 57 (57) 95 Loss from discontinued operations (13) (13) Net income $82 $57 $(57) $82 This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts reported for Dana Corporation on a fully consolidated basis. Dana Corporation Condensed Consolidating Statement of Income (Unaudited) (in millions) Three Months Ended December 31, 2003 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Net sales $2,050 $ $ $2,050 Other income 18 34 (16) 36 2,068 34 (16) 2,086 Costs and expenses Cost of sales 1,883 (13) 1,870 Realignment charges 5 5 Selling, general and administrative expenses 107 24 (3) 128 Interest expense 38 14 52 2,033 38 (16) 2,055 Income (loss) before income taxes 35 (4) - 31 Income tax benefit 2 13 15 Minority interest (3) (3) Equity in earnings of affiliates 22 4 (13) 13 Income from continuing operations 56 13 (13) 56 Income from discontinued operations 12 12 Net income $68 $13 $(13) $68 This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts reported for Dana Corporation on a fully consolidated basis. Dana Corporation Condensed Consolidating Statement of Income (Unaudited) (in millions) Year Ended December 31, 2003 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Net sales $7,918 $ $ $7,918 Other income 91 134 (76) 149 8,009 134 (76) 8,067 Costs and expenses Cost of sales 7,293 (48) 7,245 Selling, general and administrative expenses 447 101 (28) 520 Interest expense 160 61 221 7,900 162 (76) 7,986 Income (loss) before income taxes 109 (28) - 81 Income tax benefit (expense) (20) 69 49 Minority interest (7) (7) Equity in earnings of affiliates 93 20 (61) 52 Income from continuing operations 175 61 (61) 175 Income from discontinued operations 47 47 Net income $222 $61 $(61) $222 This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts reported for Dana Corporation on a fully consolidated basis. Dana Corporation Condensed Consolidating Balance Sheet (Unaudited) (in millions) December 31, 2004 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Assets Current assets Cash and cash equivalents $619 $15 $ $634 Accounts receivable Trade 1,266 1,266 Other 445 208 (209) 444 Inventories 907 907 Other current assets 192 137 (112) 217 Total current assets 3,429 360 (321) 3,468 Investment in leases 411 (130) 281 Investments and other assets 3,337 467 (659) 3,145 Property, plant and equipment, net 2,015 8 130 2,153 Total assets $8,781 $1,246 $(980) $9,047 Liabilities and Shareholders' Equity Current liabilities Notes payable $289 $68 $(202) $155 Accounts payable 1,317 1,317 Other current liabilities 1,269 67 (119) 1,217 Total current liabilities 2,875 135 (321) 2,689 Long-term debt 1,611 443 2,054 Deferred employee benefits and other noncurrent liabilities 1,739 316 (309) 1,746 Minority interest 121 2 123 Shareholders' equity 2,435 350 (350) 2,435 Total liabilities and shareholders' equity $8,781 $1,246 $(980) $9,047 This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts reported for Dana Corporation on a fully consolidated basis. Dana Corporation Condensed Consolidating Balance Sheet (Unaudited) (in millions) December 31, 2003 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Assets Current assets Cash and cash equivalents $664 $67 $ $731 Accounts receivable Trade 1,048 1,048 Other 300 26 326 Inventories 743 743 Assets of discontinued operations 1,254 1,254 Other current assets 399 212 (180) 431 Total current assets 4,408 305 (180) 4,533 Investment in leases 802 (180) 622 Investments and other assets 2,580 559 (887) 2,252 Property, plant and equipment, net 2,014 16 180 2,210 Total assets $9,002 $1,682 $(1,067) $9,617 Liabilities and Shareholders' Equity Current liabilities Notes payable $260 $233 $ $493 Accounts payable 1,076 1,076 Liabilities of discontinued operations 307 307 Other current liabilities 1,235 34 (180) 1,089 Total current liabilities 2,878 267 (180) 2,965 Long-term debt 2,087 518 2,605 Deferred employee benefits and other noncurrent liabilities 1,893 604 (596) 1,901 Minority interest 94 2 96 Shareholders' equity 2,050 291 (291) 2,050 Total liabilities and shareholders' equity $9,002 $1,682 $(1,067) $9,617 This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts reported for Dana Corporation on a fully consolidated basis. Dana Corporation Consolidating Cash Flow Impact on Net Debt (Unaudited) (in millions) Three Months Ended December 31, 2004 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Sources Net income $(133) $16 $(16) $(133) Depreciation 82 6 88 Asset sales 27 5 32 Divestitures 968 968 Working capital decrease 90 4 14 108 1,034 31 (2) 1,063 Uses Capital spend (120) (2) (122) Dividends (20) (20) Restructuring cash payments (15) (15) Additional pension contribution (198) (198) Investment in and undistributed earnings of equity affiliates (49) (4) 16 (37) Net changes in other accounts 37 (12) 43 68 (365) (18) 59 (324) Cash change in net debt $669 $13 $57 $739 Analysis of components of decrease in net debt: Net change in short-term debt $(100) $17 $(57) $(140) Net payments on long-term debt (437) (40) (477) Change in cash - continuing operations (132) 10 (122) Cash change in net debt (669) (13) (57) (739) Non-cash changes in net debt (29) (29) Total change in net debt $(698) $(13) $(57) $(768) This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts presented for Dana Corporation on a fully consolidated basis. Dana Corporation Consolidating Cash Flow Impact on Net Debt (Unaudited) (in millions) Year Ended December 31, 2004 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Sources Net income $82 $57 $(57) $82 Depreciation 332 29 361 Asset sales 67 292 (3) 356 Divestitures 968 968 Working capital decrease (increase) (261) 4 17 (240) 1,188 382 (43) 1,527 Uses Capital spend (324) (9) 3 (330) Dividends (73) (73) Restructuring cash payments (80) (80) Additional pension contribution (198) (198) Investment in and undistributed earnings of equity affiliates (129) (8) 57 (80) Net changes in other accounts (9) (203) 185 (27) (813) (220) 245 (788) Cash change in net debt $375 $162 $202 $739 Analysis of components of decrease in net debt: Net change in short-term debt $256 $(13) $(202) $41 Net payments on long-term debt (676) (201) (877) Change in cash - continuing operations 45 52 97 Cash change in net debt (375) (162) (202) (739) Non-cash changes in net debt (27) (26) (53) Total change in net debt $(402) $(188) $(202) $(792) This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts presented for Dana Corporation on a fully consolidated basis. Dana Corporation Consolidating Cash Flow Impact on Net Debt (Unaudited) (in millions) Three Months Ended December 31, 2003 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Sources Net income $68 $13 $(13) $68 Depreciation 88 12 100 Asset sales 45 43 (12) 76 Working capital decrease 147 11 (9) 149 348 79 (34) 393 Uses Capital spend (86) (3) (1) (90) Dividends (9) (50) 50 (9) Restructuring cash payments (44) (44) Investment in and undistributed earnings of equity affiliates 32 (4) (37) (9) Net changes in other accounts (17) (5) 22 - (124) (62) 34 (152) Cash change in net debt $224 $17 $- $241 Analysis of components of decrease in net debt: Net change in short-term debt $(99) $(5) $ $ (104) Net payments on long-term debt (8) (31) (39) Change in cash - continuing operations (115) 19 (96) Change in cash - discontinued operations (2) (2) Cash change in net debt (224) (17) - (241) Non-cash changes in net debt 8 (1) 7 Total change in net debt $(216) $(18) $- $(234) This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts presented for Dana Corporation on a fully consolidated basis. Dana Corporation Consolidating Cash Flow Impact on Net Debt (Unaudited) (in millions) Year Ended December 31, 200 Dana with Elimi- Dana DCC on nation Consoli- Equity Basis DCC Entries dated Sources Net income $222 $61 $(61) $222 Depreciation 337 57 394 Asset sales 89 210 (17) 282 Divestitures 145 145 Working capital decrease (increase) (72) 3 (7) (76) 721 331 (85) 967 Uses Capital spend (295) (12) 2 (305) Dividends (14) (50) 50 (14) Restructuring cash payments (136) (136) Investment in and undistributed earnings of equity affiliates (45) (20) 11 (54) Net changes in other accounts 41 - 22 63 (449) (82) 85 (446) Cash change in net debt $272 $249 $- $521 Analysis of components of decrease in net debt: Net change in short-term debt $(12) $(101) $ $(113) Repurchases of long-term debt (140) (140) Proceeds from swap settlement 18 18 Net payments on long-term debt (23) (101) (124) Change in cash - continuing operations (113) (47) (160) Change in cash - discontinued operations (2) (2) Cash change in net debt (272) (249) - (521) Non-cash changes in net debt (9) (34) (43) Total change in net debt $(281) $(283) $- $(564) This consolidating statement provides a reconciliation of the amounts presented for Dana with Dana Credit Corporation (DCC) on an equity basis to amounts presented for Dana Corporation on a fully consolidated basis. Investor Relations Dana Corporation Quarterly Financial Information (Unaudited) For the Quarter Ended December 31, 2004 (in millions) Inter- Segment External Sales Sales EBIT 04 03 04 03 04 03 Automotive Systems Group $1,692 $1,531 $46 $38 $61 $93 Heavy Vehicle Technologies and Systems Group 590 499 9 17 41 37 Dana Commercial Credit Other 18 20 1 1 (64) (58) Continuing Operations 2,300 2,050 56 56 38 72 Discontinued Operations 19 Unusual Items Excluded from Performance Measurement (277) (5) Consolidated $2,300 $2,050 $56 $56 $(239) $86 North America $1,456 $1,388 $28 $22 $16 $78 Europe 487 381 37 22 41 29 South America 172 126 63 43 23 23 Asia Pacific 185 155 6 1 14 10 Dana Commercial Credit Other (56) (68) Continuing Operations 2,300 2,050 134 88 38 72 Discontinued Operations 19 Unusual Items Excluded from Performance Measurement (277) (5) Consolidated $2,300 $2,050 $134 $88 $(239) $86 Information for Discontinued Operations 342 473 2 3 Investor Relations Dana Corporation Quarterly Financial Information (Unaudited) For the Quarter Ended December 31, 2004 (in millions) Operating PAT Net Profit Net Assets 04 03 04 03 04 03 Automotive Systems Group $49 $67 $12 $32 $3,100 $3,027 Heavy Vehicle Technologies and Systems Group 25 22 10 9 676 610 Dana Commercial Credit 13 3 13 3 350 291 Other (27) (45) 25 3 41 13 Continuing Operations 60 47 60 47 4,167 3,941 Discontinued Operations 2 15 2 15 Unusual Items Excluded from Performance Measurement (195) 6 (195) 6 Consolidated $(133) $68 $(133) $68 $4,167 $3,941 North America $11 $46 $(20) $13 $2,230 $1,478 Europe 33 24 23 15 1,224 1,021 South America 14 14 10 11 384 222 Asia Pacific 8 6 5 2 198 158 Dana Commercial Credit 13 3 13 3 350 291 Other (19) (46) 29 3 (219) 771 Continuing Operations 60 47 60 47 4,167 3,941 Discontinued Operations 2 15 2 15 Unusual Items Excluded from Performance Measurement (195) 6 (195) 6 Consolidated $(133) $68 $(133) $68 $4,167 $3,941 Information for Discontinued Operations FOR MORE INFORMATION ( http://www.dana.com/ ) - Dial-For-Dana U.S. or Canada 800-537-8823; OH 800-472-8810 E-Mail or Dana Investor Relations 419-535-4635 Investor Relations Dana Corporation Quarterly Financial Information (Unaudited) For the Twelve Months Ended December 31, 2004 (in millions) Inter- Segment External Sales Sales EBIT 04 03 04 03 04 03 Automotive Systems Group $6,658 $5,927 $187 $149 $340 $339 Heavy Vehicle Technologies and Systems Group 2,322 1,924 35 75 173 130 Dana Commercial Credit Other 76 67 7 6 (228) (221) Continuing Operations 9,056 7,918 229 230 285 248 Discontinued Operations 84 90 Unusual Items Excluded from Performance Measurement (292) (1) Consolidated $9,056 $7,918 $229 $230 $77 $337 North America $6,010 $5,473 $109 $88 $196 $245 Europe 1,775 1,455 127 81 141 113 South America 626 441 212 165 97 70 Asia Pacific 645 549 28 3 39 47 Dana Commercial Credit Other (188) (227) Continuing Operations 9,056 7,918 476 337 285 248 Discontinued Operations 84 90 Unusual Items Excluded from Performance Measurement (292) (1) Consolidated $9,056 $7,918 $476 $337 $77 $337 Information for Discontinued Operations 1,949 2,153 16 14 Investor Relations Dana Corporation Quarterly Financial Information (Unaudited) For the Twelve Months Ended December 31, 2004 (in millions) Operating PAT Net Profit Net Assets 04 03 04 03 04 03 Automotive Systems Group $238 $242 $106 $111 $3,100 $3,027 Heavy Vehicle Technologies and Systems Group 106 79 48 27 676 610 Dana Commercial Credit 29 21 29 21 350 291 Other (163) (211) 27 (28) 41 13 Continuing Operations 210 131 210 131 4,167 3,941 Discontinued Operations 52 52 52 52 Unusual Items Excluded from Performance Measurement (180) 39 (180) 39 Consolidated $82 $222 $82 $222 $4,167 $3,941 North America $123 $150 $15 $30 $2,230 $1,478 Europe 105 88 72 55 1,224 1,021 South America 59 43 48 33 384 222 Asia Pacific 25 30 11 15 198 158 Dana Commercial Credit 29 21 29 21 350 291 Other (131) (201) 35 (23) (219) 771 Continuing Operations 210 131 210 131 4,167 3,941 Discontinued Operations 52 52 52 52 Unusual Items Excluded from Performance Measurement (180) 39 (180) 39 Consolidated $82 $222 $82 $222 $4,167 $3,941 Information for Discontinued Operations FOR MORE INFORMATION ( http://www.dana.com/ ) - Dial-For-Dana U.S. or Canada 800-537-8823; OH 800-472-8810 E-Mail or Dana Investor Relations 419-535-4635 http://www.newscom.com/cgi-bin/prnh/19990903/DANA http://photoarchive.ap.org/ DATASOURCE: Dana Corporation CONTACT: Michelle L. Hards of Dana Corporation, +1-419-535-4636, or Web site: http://www.dana.com/ Company News On-Call: http://www.prnewswire.com/comp/226839.html

Copyright