DAN

DANA INC

Consumer Cyclical | Small Cap

$0.26

EPS Forecast

$2,626

Revenue Forecast

The company already released most recent quarter's earnings. We will publish our AI's next quarter's forecast around 2024-12-31
EX-99.1 2 d884162dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

IMMEDIATE    

Dana Incorporated Reports 2019 Financial Results

Company achieves full-year record sales, profit, and adjusted earnings per share;

Adjusted free cash flow increased by 12%;

Company wins electric medium-duty truck program with fully integrated Dana e-Powertrain as part of $700 million total sales backlog through 2022

Full-Year Highlights

 

   

Record sales of $8.6 billion, an increase of $477 million, or growth of 6 percent, compared with 2018

 

   

Net income attributable to Dana of $226 million; diluted EPS of $1.56

 

   

Record adjusted EBITDA of $1.02 billion, an increase of $62 million, margin of 11.8 percent of sales

 

   

Record diluted adjusted EPS of $3.06, an improvement of $0.04 over 2018

 

   

Operating cash flow of $637 million

 

   

Adjusted free cash flow of $272 million, a 12 percent improvement over 2018

 

   

Cash dividends of $0.40 per share declared in 2019

 

   

Strong sales backlog of $700 million through 2022

 

   

Acquisition cost synergies of $25 million

 

   

Completed five electrodynamics acquisitions rounding-out complete in-house capability

MAUMEE, Ohio, Feb. 13, 2020 – Dana Incorporated (NYSE: DAN) today announced financial results for the fourth quarter and full-year 2019.

“In 2019, for the third consecutive year, Dana delivered year-over-year growth in revenue, adjusted EBITDA, and adjusted free cash flow,” said James Kamsickas, Dana chairman and CEO. “Over the past year, the Dana team achieved more than $1 billion of adjusted EBITDA for the first time in the history of the company, while successfully integrating the Graziano and Fairfield business, Dana’s largest acquisition in over two decades.”

Fourth-quarter 2019 Financial Results

Sales for the fourth quarter of 2019 totaled $1.99 billion, compared with $1.97 billion in the same period of 2018, representing a $14 million improvement. The increase was attributable to the benefit of recent acquisitions and backlog conversion, partially offset by lower end-market demand for heavy vehicles and unfavorable currency translation and lower commodity recoveries.

Dana reported net income of $85 million for the fourth quarter of 2019, compared with net income of $100 million in the same period of 2018. The difference was primarily due to higher interest expense and one-time costs related to refinancing of senior notes and acquisitions.

Reported diluted earnings per share were $0.58, compared with diluted earnings per share of $0.69 in the fourth quarter of 2018.

Adjusted EBITDA for the fourth quarter of 2019 was $226 million, compared with $223 million for the same period last year. Profit in the fourth quarter of 2019 benefited from backlog conversion and inorganic growth, partially offset by an unfavorable mix, driven by lower end-market demand for heavy vehicles.

Diluted adjusted earnings per share were $0.67 in the fourth quarter of 2019, compared with $0.76 in the same period last year. The lower year-over-year comparison was primarily due to higher depreciation and interest expense offsetting higher operating earnings.

Operating cash flow in the fourth quarter of 2019 was $349 million, compared with $331 million in the same period of 2018.

 

1


Adjusted free cash flow was $218 million, compared with $241 million in the fourth quarter of 2018. Lower cash generation was driven by higher capital expenditures to support new programs partially offset by favorable working capital.

Full-year 2019 Financial Results

Sales for 2019 were $8.6 billion, compared with $8.1 billion, an increase of 6 percent, primarily due to conversion of sales backlog and acquisitions partially offset by lower end-market demand for heavy vehicles, as well as currency headwinds.

Net income in 2019 was $226 million, compared with net income of $427 million in 2018. Reported diluted earnings per share were $1.56, compared with $2.91 in 2018. 2019 results included one-time charges of $259 million for discretionary pension transfers.

Adjusted EBITDA for 2019 was $1.02 billion, or 11.8 percent of sales. Margin was comparable to the prior year despite unfavorable mix due to lower end-market demand for heavy vehicles.

Diluted adjusted earnings per share for 2019 were $3.06, compared with $3.02 in 2018, an increase of $0.04, primarily reflecting higher year-over-year earnings improvement partially offset by higher depreciation and interest.

The company reported operating cash flow of $637 million in 2019, an improvement of $69 million compared with 2018. Adjusted free cash flow was $272 million, or 3.2 percent of sales, compared with $243 million, or 3 percent of sales in 2018. The improvement was driven by higher earnings, lower cash taxes, and lower working capital requirements, partially offset by higher capital expenditures to support new programs, higher interest expense, and one-time costs related to acquisitions.

2020 Guidance Ranges

“Despite expected softer demand in our heavy-vehicle markets, we continue to successfully manage through this cycle and execute our strategic plan,” said Jonathan Collins, Dana executive vice president and chief financial officer. “We have positioned the company for significant adjusted free cash flow growth this year, and our strong sales backlog and multi-market focus will buffer end-market demand.”

2020 Financial Targets1

 

   

Sales of $8.25 to $8.75 billion;

 

   

Adjusted EBITDA of $950 million to $1.05 billion, an implied adjusted EBITDA margin of approximately 11.8 percent at the midpoint of the range;

 

   

Diluted adjusted EPS of $2.65 to $3.15;

 

   

Operating cash flow of approximately 8.5 to 9.0 percent; and

 

   

Adjusted free cash flow of approximately 4 to 4.5 percent of sales.

 

1 

Net income and diluted EPS guidance are not provided, as discussed below in Non-GAAP Financial Information.

Dana to Host Conference Call at 10:30 a.m. Thursday, Feb. 13

Dana will discuss its fourth-quarter and full-year results in a conference call at 10:30 a.m. EST on Thursday, Feb. 13. Participants may listen to the audio portion of the conference call either through audio streaming online or by telephone. Slide viewing is available online via a link provided on the Dana investor website: www.dana.com/investors. U.S. and Canadian locations should dial 1-888-311-4590 and international locations should call 1-706-758-0054. Please enter conference I.D. 4099809 and ask for the “Dana Incorporated’s Financial Webcast and Conference Call.” Phone registration will be available starting at 10 a.m. EST.

An audio recording of the webcast will be available after 5 p.m. EST on Feb. 13 by dialing 1-855-859-2056 (U.S. or Canada) or 1-404-537-3406 (international) and entering conference I.D. 4099809. A webcast replay will also be available after 5 p.m. EST and may be accessed via Dana’s investor website.

 

2


Non-GAAP Financial Information

This release refers to adjusted EBITDA, a non-GAAP financial measure which we have defined as net income 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 income before income taxes, net income or other results reported in accordance with GAAP. Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.

Diluted adjusted EPS is a non-GAAP financial measure, which we have defined as adjusted net income divided by adjusted diluted shares. We define adjusted net income as net income (loss) attributable to the parent company, excluding any nonrecurring income tax items, restructuring charges, amortization expense, and other adjustments not related to our core operations (as used in adjusted EBITDA), net of any associated income tax effects. We define adjusted diluted shares as diluted shares as determined in accordance with GAAP based on adjusted net income. This measure is considered useful for purposes of providing investors, analysts, and other interested parties with an indicator of ongoing financial performance that provides enhanced comparability to EPS reported by other companies. Diluted adjusted EPS is neither intended to represent nor be an alternative measure to diluted EPS reported under GAAP.

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. Adjusted free cash flow is a non-GAAP financial measure which we have defined as net cash provided by (used in) operating activities excluding voluntary pension contributions less purchases of property, plant, and equipment. We believe these measures are useful to investors in evaluating the operational cash flow of the company inclusive of the spending required to maintain the operations. Free cash flow and adjusted free cash flow are not intended to represent nor be an alternative to the measure of net cash provided by (used in) operating activities reported under GAAP. Free cash flow and adjusted free cash flow may not be comparable to similarly titled measures reported by other companies.

We have not provided reconciliations of preliminary and projected adjusted EBITDA and diluted adjusted EPS to the most comparable GAAP measures of net income and diluted EPS. Providing net income and diluted EPS 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 and diluted EPS, including restructuring actions, asset impairments, and income tax valuation adjustments. Reconciliations of these non-GAAP measures with the most comparable GAAP measures for historical periods are indicative of the reconciliations that will be prepared upon completion of the periods covered by the non-GAAP guidance. Please reference the “Non-GAAP Financial Information” accompanying our quarterly earnings conference call presentations on our website at www.dana.com/investors for our GAAP results and the reconciliations of these measures, were used, to the comparable GAAP measures.

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.

 

3


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 world leader in providing power-conveyance and energy-management solutions that are engineered to improve the efficiency, performance, and sustainability of light vehicles, commercial vehicles, and off-highway equipment. Enabling the propulsion of conventional, hybrid, and electric-powered vehicles, Dana equips its customers with critical drive and motion systems; electrodynamic technologies; and thermal, sealing, and digital solutions.

Founded in 1904, Dana employs more than 36,000 people who are committed to delivering long-term value to their customers, which include nearly every vehicle manufacturer in the world. Based in Maumee, Ohio, USA, and with locations in 34 countries across six continents, the company reported sales of $8.6 billion in 2019. Having established a high-performance culture that focuses on its people, the company has earned recognition around the world as a top employer. Learn more at dana.com.

###

 

Media Contact:    Jeff Cole
   +1-419-887-3535
   jeff.cole@dana.com
Investor Contact:        Craig Barber
   +1-419-887-5166
   craig.barber@dana.com

 

4


DANA INCORPORATED     

Consolidated Statement of Operations (Unaudited)     

For the Three Months Ended December 31, 2019 and 2018     

 

     Three Months Ended  
(In millions, except per share amounts)    December 31,  
     2019     2018  

Net sales

   $ 1,987     $ 1,973  

Costs and expenses

    

Cost of sales

     1,764       1,717  

Selling, general and administrative expenses

     104       116  

Amortization of intangibles

     4       2  

Restructuring charges, net

     6       8  

Impairment of goodwill

     (6  

Pension settlement charges

     1    

Other income (expense), net

     6       (10
  

 

 

   

 

 

 

Earnings before interest and income taxes

     110       120  

Loss on extinguishment of debt

     (9  

Interest income

     2       3  

Interest expense

     30       25  
  

 

 

   

 

 

 

Earnings before income taxes

     73       98  

Income tax expense (benefit)

     (5     3  

Equity in earnings of affiliates

     8       11  
  

 

 

   

 

 

 

Net income

     86       106  

Less: Noncontrolling interests net income

     4       7  

Less: Redeemable noncontrolling interests net loss

     (3     (1
  

 

 

   

 

 

 

Net income attributable to the parent company

   $ 85     $ 100  
  

 

 

   

 

 

 

Net income per share available to common stockholders

    

Basic

   $ 0.59     $ 0.69  

Diluted

   $ 0.58     $ 0.69  

Weighted-average shares outstanding - Basic

     144.0       144.8  

Weighted-average shares outstanding - Diluted

     145.3       145.8  

 

5


DANA INCORPORATED     

Consolidated Statement of Operations     

For the Year Ended December 31, 2019 and 2018     

 

     Year Ended  
(In millions, except per share amounts)    December 31,  
     2019     2018  

Net sales

   $ 8,620     $ 8,143  

Costs and expenses

    

Cost of sales

     7,489       6,986  

Selling, general and administrative expenses

     508       499  

Amortization of intangibles

     12       8  

Restructuring charges, net

     29       25  

Impairment of goodwill and indefinite-lived intangible asset

     (6     (20

Gain on disposal group held for sale

       3  

Pension settlement charges

     (259  

Other expense, net

     (25     (29
  

 

 

   

 

 

 

Earnings before interest and income taxes

     292       579  

Loss on extinguishment of debt

     (9  

Interest income

     10       11  

Interest expense

     122       96  
  

 

 

   

 

 

 

Earnings before income taxes

     171       494  

Income tax expense (benefit)

     (32     78  

Equity in earnings of affiliates

     30       24  
  

 

 

   

 

 

 

Net income

     233       440  

Less: Noncontrolling interests net income

     13       13  

Less: Redeemable noncontrolling interests net loss

     (6  
  

 

 

   

 

 

 

Net income attributable to the parent company

   $ 226     $ 427  
  

 

 

   

 

 

 

Net income per share available to common stockholders

    

Basic

   $ 1.57     $ 2.94  

Diluted

   $ 1.56     $ 2.91  

Weighted-average shares outstanding - Basic

     144.0       145.0  

Weighted-average shares outstanding - Diluted

     145.1       146.5  

 

6


DANA INCORPORATED     

Consolidated Statement of Comprehensive Income (Unaudited)     

For the Three Months Ended December 31, 2019 and 2018     

 

     Three Months Ended  
(In millions)    December 31,  
     2019     2018  

Net income

   $ 86     $ 106  

Other comprehensive income (loss), net of tax:

    

Currency translation adjustments

     24       2  

Hedging gains and losses

     9       21  

Defined benefit plans

     (21     (11
  

 

 

   

 

 

 

Other comprehensive income

     12       12  
  

 

 

   

 

 

 

Total comprehensive income

     98       118  

Less: Comprehensive income attributable to noncontrolling interests

     (13     (7

Less: Comprehensive loss attributable to redeemable noncontrolling interests

     7       6  
  

 

 

   

 

 

 

Comprehensive income attributable to the parent company

   $ 92     $ 117  
  

 

 

   

 

 

 

 

7


DANA INCORPORATED     

Consolidated Statement of Comprehensive Income     

For the Year Ended December 31, 2019 and 2018     

 

     Year Ended  
(In millions)    December 31,  
     2019     2018  

Net income

   $ 233     $ 440  

Other comprehensive income (loss), net of tax:

    

Currency translation adjustments

     8       (63

Hedging gains and losses

     24       10  

Defined benefit plans

     344       23  
  

 

 

   

 

 

 

Other comprehensive income (loss)

     376       (30
  

 

 

   

 

 

 

Total comprehensive income

     609       410  

Less: Comprehensive income attributable to noncontrolling interests

     (9     (7

Less: Comprehensive loss attributable to redeemable noncontrolling interests

     1       6  
  

 

 

   

 

 

 

Comprehensive income attributable to the parent company

   $ 601     $ 409  
  

 

 

   

 

 

 

 

8


DANA INCORPORATED     

Consolidated Balance Sheet     

As of December 31, 2019 and December 31, 2018     

 

(In millions, except share and per share amounts)    December 31,     December 31,  
     2019     2018  

Assets

    

Current assets

    

Cash and cash equivalents

   $ 508     $ 510  

Marketable securities

     19       21  

Accounts receivable

    

Trade, less allowance for doubtful accounts of $9 in 2019 and 2018

     1,103       1,065  

Other

     202       178  

Inventories

     1,193       1,031  

Other current assets

     137       102  
  

 

 

   

 

 

 

Total current assets

     3,162       2,907  

Goodwill

     493       264  

Intangibles

     240       164  

Deferred tax assets

     580       445  

Other noncurrent assets

     120       80  

Investments in affiliates

     182       208  

Operating lease assets

     178    

Property, plant and equipment, net

     2,265       1,850  
  

 

 

   

 

 

 

Total assets

   $ 7,220     $ 5,918  
  

 

 

   

 

 

 

Liabilities and equity

    

Current liabilities

    

Short-term debt

   $ 14     $ 8  

Current portion of long-term debt

     20       20  

Accounts payable

     1,255       1,217  

Accrued payroll and employee benefits

     206       186  

Taxes on income

     46       47  

Current portion of operating lease liabilities

     42    

Other accrued liabilities

     262       269  
  

 

 

   

 

 

 

Total current liabilities

     1,845       1,747  

Long-term debt, less debt issuance costs of $28 in 2019 and $18 in 2018

     2,336       1,755  

Noncurrent operating lease liabilities

     140    

Pension and postretirement obligations

     459       561  

Other noncurrent liabilities

     305       313  
  

 

 

   

 

 

 

Total liabilities

     5,085       4,376  
  

 

 

   

 

 

 

Commitments and contingencies

    

Redeemable noncontrolling interests

     167       100  

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, 143,942,539 and 144,663,403 shares outstanding

     2       2  

Additional paid-in capital

     2,386       2,368  

Retained earnings

     622       456  

Treasury stock, at cost (10,111,191 and 8,342,185 shares)

     (150     (119

Accumulated other comprehensive loss

     (987     (1,362
  

 

 

   

 

 

 

Total parent company stockholders’ equity

     1,873       1,345  

Noncontrolling interests

     95       97  
  

 

 

   

 

 

 

Total equity

     1,968       1,442  
  

 

 

   

 

 

 

Total liabilities and equity

   $ 7,220     $ 5,918  
  

 

 

   

 

 

 

 

9


DANA INCORPORATED

Consolidated Statement of Cash Flows (Unaudited)

For the Three Months Ended December 31, 2019 and 2018

 

(In millions)    Three Months Ended
December 31,
 
     2019     2018  

Operating activities

    

Net income

   $ 86     $ 106  

Depreciation

     87       73  

Amortization

     5       2  

Amortization of deferred financing charges

     1       1  

Call premium on debt

     7    

Write-off of deferred financing costs

     2    

Earnings of affiliates, net of dividends received

     (6     (9

Stock compensation expense

     4       3  

Deferred income taxes

     (17     (17

Pension expense, net

     4       1  

Impairment of goodwill and indefinite-lived intangible asset

     6    

Change in working capital

     180       156  

Change in other noncurrent assets and liabilities

     (18     (12

Other, net

     8       27  
  

 

 

   

 

 

 

Net cash provided by operating activities

     349       331  
  

 

 

   

 

 

 

Investing activities

    

Purchases of property, plant and equipment

     (128     (90

Acquisition of businesses, net of cash acquired

     (2     (2

Purchases of marketable securities

     (9     (1

Proceeds from sales of marketable securities

       9  

Proceeds from maturities of marketable securities

     10       7  

Other, net

     1    
  

 

 

   

 

 

 

Net cash used in investing activities

     (128     (77
  

 

 

   

 

 

 

Financing activities

    

Net change in short-term debt

     (95     (8

Proceeds from long-term debt

     300    

Repayment of long-term debt

     (302     (5

Call premium on debt

     (7  

Deferred financing payments

     (4     (1

Dividends paid to common stockholders

     (15     (15

Distributions to noncontrolling interests

     (5     (35

Contributions from noncontrolling interests

       3  

Other, net

     2       3  
  

 

 

   

 

 

 

Net cash used in financing activities

     (126     (58
  

 

 

   

 

 

 

Net increase in cash, cash equivalents and restricted cash

     95       196  

Cash, cash equivalents and restricted cash – beginning of period

     412       327  

Effect of exchange rate changes on cash balances

     11       (3
  

 

 

   

 

 

 

Cash, cash equivalents and restricted cash – end of period

   $ 518     $ 520  
  

 

 

   

 

 

 

 

10


DANA INCORPORATED

Consolidated Statement of Cash Flows

For the Year Ended December 31, 2019 and 2018

 

(In millions)    Year Ended
December 31,
 
     2019     2018  

Operating activities

    

Net income

   $ 233     $ 440  

Depreciation

     322       260  

Amortization

     17       10  

Amortization of deferred financing charges

     6       4  

Call premium on debt

     7    

Write-off of deferred financing costs

     2    

Earnings of affiliates, net of dividends received

     (9     (4

Stock compensation expense

     19       16  

Deferred income taxes

     (137     (64

Pension expense, net

     211       3  

Impairment of goodwill and indefinite-lived intangible asset

     6       20  

Gain on disposal group held for sale

       (2

Change in working capital

     (17     (113

Change in other noncurrent assets and liabilities

     (18     (12

Other, net

     (5     10  
  

 

 

   

 

 

 

Net cash provided by operating activities

     637       568  
  

 

 

   

 

 

 

Investing activities

    

Purchases of property, plant and equipment

     (426     (325

Acquisition of businesses, net of cash acquired

     (668     (153

Proceeds from previous acquisition

       9  

Purchases of marketable securities

     (33     (37

Proceeds from sales of marketable securities

     6       15  

Proceeds from maturities of marketable securities

     29       37  

Proceeds from sale of subsidiaries, net of cash disposed

     1       (6

Settlements of undesignated derivatives

     (20  

Other, net

     (12     (2
  

 

 

   

 

 

 

Net cash used in investing activities

     (1,123     (462
  

 

 

   

 

 

 

Financing activities

    

Net change in short-term debt

     (3     (21

Proceeds from long-term debt

     975    

Repayment of long-term debt

     (423     (13

Call premium on debt

     (7  

Deferred financing payments

     (20     (1

Dividends paid to common stockholders

     (58     (58

Distributions to noncontrolling interests

     (19     (42

Sale of interest to noncontrolling shareholder

     53    

Contributions from noncontrolling interests

     4       25  

Payments to acquire redeemable noncontrolling interests

       (43

Repurchases of common stock

     (25     (25

Other, net

     2       (2
  

 

 

   

 

 

 

Net cash provided by (used in) financing activities

     479       (180
  

 

 

   

 

 

 

Net decrease in cash, cash equivalents and restricted cash

     (7     (74

Cash, cash equivalents and restricted cash – beginning of period

     520       610  

Effect of exchange rate changes on cash balances

     5       (16
  

 

 

   

 

 

 

Cash, cash equivalents and restricted cash – end of period

   $ 518     $ 520  
  

 

 

   

 

 

 

 

11


DANA INCORPORATED

Reconciliation of Net Cash Provided by Operating Activities to

    Free Cash Flow and Adjusted Free Cash Flow (Unaudited)

 

(In millions)    Three Months Ended
December 31,
 
     2019     2018  

Net cash provided by operating activities

   $ 349     $ 331  

Purchases of property, plant and equipment

     (128     (90
  

 

 

   

 

 

 

Free cash flow

     221       241  

Discretionary pension contributions

     (3  
  

 

 

   

 

 

 

Adjusted free cash flow

   $ 218     $ 241  
  

 

 

   

 

 

 
(In millions)    Year Ended
December 31,
 
     2019     2018  

Net cash provided by operating activities

   $ 637     $ 568  

Purchases of property, plant and equipment

     (426     (325
  

 

 

   

 

 

 

Free cash flow

     211       243  

Discretionary pension contributions

     61       —    
  

 

 

   

 

 

 

Adjusted free cash flow

   $ 272     $ 243  
  

 

 

   

 

 

 
(In millions)    2020
Guidance
       

Net cash provided by operating activities

   $ 760    

Purchases of property, plant and equipment

     (385  
  

 

 

   

Free cash flow

     375    

Discretionary pension contributions

     —      
  

 

 

   

Adjusted free cash flow

   $ 375    
  

 

 

   

 

12


DANA INCORPORATED

Segment Sales and Segment EBITDA (Unaudited)

For the Three Months Ended December 31, 2019 and 2018

 

(In millions)    Three Months Ended
December 31,
 
     2019      2018  

Sales

     

Light Vehicle

   $ 846      $ 873  

Commercial Vehicle

     345        395  

Off-Highway

     552        442  

Power Technologies

     244        263  
  

 

 

    

 

 

 

Total Sales

   $ 1,987      $ 1,973  
  

 

 

    

 

 

 

Segment EBITDA

     

Light Vehicle

   $ 105      $ 101  

Commercial Vehicle

     23        32  

Off-Highway

     66        65  

Power Technologies

     27        32  
  

 

 

    

 

 

 

Total Segment EBITDA

     221        230  

Corporate expense and other items, net

     5        (7
  

 

 

    

 

 

 

Adjusted EBITDA

   $ 226      $ 223  
  

 

 

    

 

 

 

 

13


DANA INCORPORATED

Segment Sales and Segment EBITDA

For the Year Ended December 31, 2019 and 2018

 

(In millions)    Year Ended
December 31,
 
     2019     2018  

Sales

    

Light Vehicle

   $ 3,609     $ 3,575  

Commercial Vehicle

     1,611       1,612  

Off-Highway

     2,360       1,844  

Power Technologies

     1,040       1,112  
  

 

 

   

 

 

 

Total Sales

   $ 8,620     $ 8,143  
  

 

 

   

 

 

 

Segment EBITDA

    

Light Vehicle

   $ 438     $ 398  

Commercial Vehicle

     138       146  

Off-Highway

     330       285  

Power Technologies

     117       149  
  

 

 

   

 

 

 

Total Segment EBITDA

     1,023       978  

Corporate expense and other items, net

     (4     (21
  

 

 

   

 

 

 

Adjusted EBITDA

   $ 1,019     $ 957  
  

 

 

   

 

 

 

 

14


DANA INCORPORATED

Reconciliation of Segment and Adjusted EBITDA to Net Income (Unaudited)

For the Three Months Ended December 31, 2019 and 2018

 

(In millions)    Three Months Ended
December 31,
 
     2019     2018  

Segment EBITDA

   $ 221     $ 230  

Corporate expense and other items, net

     5       (7
  

 

 

   

 

 

 

Adjusted EBITDA

     226       223  

Depreciation

     (87     (73

Amortization

     (5     (2

Non-service cost components of pension and OPEB costs

     (4     (5

Restructuring charges, net

     (6     (8

Stock compensation expense

     (4     (3

Strategic transaction expenses, net of transaction fee breakup income

     (9     (5

Acquisition related inventory adjustments

     (1  

Other items

     (2     (7

Gain on liquidation of foreign entity

     12    

Impairment goodwill of indefinite-lived intangible asset

     (6  

Amounts attributable to previously divested/closed operations

     (5  

Pension settlement charges

     1    
  

 

 

   

 

 

 

Earnings before interest and income taxes

     110       120  

Loss on extinguishment of debt

     (9  

Interest expense

     30       25  

Interest income

     2       3  
  

 

 

   

 

 

 

Earnings before income taxes

     73       98  

Income tax expense (benefit)

     (5     3  

Equity in earnings of affiliates

     8       11  
  

 

 

   

 

 

 

Net income

   $ 86     $ 106  
  

 

 

   

 

 

 

 

15


DANA INCORPORATED

Reconciliation of Segment and Adjusted EBITDA to Net Income

For the Year Ended December 31, 2019 and 2018

 

(In millions)    Year Ended
December 31,
 
     2019     2018  

Segment EBITDA

   $ 1,023     $ 978  

Corporate expense and other items, net

     (4     (21
  

 

 

   

 

 

 

Adjusted EBITDA

     1,019       957  

Depreciation

     (322     (260

Amortization

     (17     (10

Non-service cost components of pension and OPEB costs

     (23     (15

Restructuring charges, net

     (29     (25

Stock compensation expense

     (19     (16

Strategic transaction expenses, net of transaction fee breakup income

     (41     (18

Acquisition related inventory adjustments

     (13  

Non-income tax legal judgment

     6    

Other items

     (11     (17

Gain on disposal group held for sale

       3  

Gain on liquidation of foreign entity

     12    

Impairment goodwill of indefinite-lived intangible asset

     (6     (20

Amounts attributable to previously divested/closed operations

     (5  

Pension settlement charges

     (259  
  

 

 

   

 

 

 

Earnings before interest and income taxes

     292       579  

Loss on extinguishment of debt

     (9  

Interest expense

     122       96  

Interest income

     10       11  
  

 

 

   

 

 

 

Earnings before income taxes

     171       494  

Income tax expense (benefit)

     (32     78  

Equity in earnings of affiliates

     30       24  
  

 

 

   

 

 

 

Net income

   $ 233     $ 440  
  

 

 

   

 

 

 

 

16


DANA INCORPORATED

Diluted Adjusted EPS (Unaudited)

For the Three Months Ended December 31, 2019 and 2018

 

(In millions, except per share amounts)             
     Three Months Ended
December 31,
 
     2019     2018  

Net income attributable to parent company

   $ 85     $ 100  

Items impacting income before income taxes:

    

Restructuring charges

     6       8  

Amortization

     5       2  

Strategic transaction expenses, net of transaction breakup fee income

     9       5  

Acquisition related inventory adjustments

     1    

Gain on liquidation of foreign subsidiary

     (12  

Impairment of goodwill

     6    

Amounts attributable to previously divested/closed operations

     5    

Pension settlement charges

     (1  

Loss on extinguishment of debt

     9    

Loss on deal contingent forward

       8  

Other items

     (2     3  

Items impacting income taxes:

    

Net income tax expense on items above

     (3     (3

Tax benefit attributable to utilization of federal tax credits, state tax law changes and valuation allowance adjustments

     (11     (12
  

 

 

   

 

 

 

Adjusted net income

   $ 97     $ 111  
  

 

 

   

 

 

 

Diluted shares - as reported

     145.3       145.8  
  

 

 

   

 

 

 

Adjusted diluted shares

     145.3       145.8  
  

 

 

   

 

 

 

Diluted adjusted EPS

   $ 0.67     $ 0.76  

As originally reported

     $ 0.71  

Impact of adjustment for deal contingent forward

     $ 0.05  

 

17


DANA INCORPORATED     

Diluted Adjusted EPS (Unaudited)     

For the Year Ended December 31, 2019 and 2018

 

(In millions, except per share amounts)             
     Year Ended
December 31,
 
     2019     2018  

Net income attributable to parent company

   $ 226     $ 427  

Items impacting income before income taxes:

    

Restructuring charges

     29       25  

Amortization

     17       10  

Strategic transaction expenses, net of transaction breakup fee income

     41       18  

Acquisition related inventory adjustments

     13    

Non-income tax legal judgment

     (6  

Gain on liquidation of foreign subsidiary

     (12  

Impairment of goodwill and indefinitie-lived intangible asset

     6       20  

Amounts attributable to previously divested/closed operations

     5    

Pension settlement charges

     259    

Loss on extinguishment of debt

     9    

Loss on deal contingent forward

     13       8  

Other items

     (2     6  

Items impacting income taxes:

    

Net income tax expense on items above

     (27     (18

Tax benefit attributable to utilization of federal tax credits, state tax law changes and valuation allowance adjustments

     (127     (53
  

 

 

   

 

 

 

Adjusted net income

   $ 444     $ 443  
  

 

 

   

 

 

 

Diluted shares - as reported

     145.1       146.5  
  

 

 

   

 

 

 

Adjusted diluted shares

     145.1       146.5  
  

 

 

   

 

 

 

Diluted adjusted EPS

   $ 3.06     $ 3.02  

As originally reported

     $ 2.97  

Impact of adjustment for deal contingent forward

     $ 0.05  

 

18