EX-99.1 2 l40892exv99w1.htm EX-99.1 exv99w1
Exhibit 99.1
(DANA LOGO)
Dana Holding Corporation Reports Third-Quarter Profit of $46 Million,
Achieves Positive Free Cash Flow for Sixth Consecutive Quarter, Raises Full-Year Guidance
MAUMEE, Ohio – October 28, 2010 – Dana Holding Corporation (NYSE: DAN) today announced strong third-quarter 2010 results. Highlights for the quarter included:
  •   Delivering positive net income of $46 million
 
  •   Achieving adjusted EBITDA of $148 million on sales of $1.5 billion with adjusted EBITDA margin of 9.8 percent
 
  •   Raising full-year adjusted EBITDA outlook to a range of $530 million to $550 million
 
  •   Generating free cash flow of $59 million, marking sixth consecutive positive quarter
 
  •   Increasing net cash position to $184 million
The company reported quarterly net income of $46 million, a substantial increase over the net loss of $38 million reported during the same period last year. Third-quarter adjusted EBITDA was $148 million, a 47-percent improvement over the $101 million reported for the same period in 2009, and adjusted EBITDA margin for the quarter improved to 9.8 percent, compared with 7.6 percent one year ago. Sales for the period were $1,516 million, up from $1,329 million for the third quarter last year.
Dana achieved positive free cash flow for the sixth consecutive quarter, generating $59 million during the third quarter, compared to free cash flow of $145 million one year ago. Total cash at the end of the third quarter was $1,137 million, resulting in a net cash position of $184 million – an increase of $64 million from the end of the prior quarter and $240 million from the end of last year.
As a result of its solid third-quarter performance and based on its anticipated 2010 full-year sales of approximately $6 billion, the company has improved its full-year adjusted EBITDA outlook to a range of $530 million to $550 million. Dana has also indicated that it now expects to achieve positive free cash flow in a range of $275 million to $300 million in 2010.
“Dana had a strong third quarter with adjusted EBITDA of $148 million and a substantial improvement in profits,” said Dana President and Chief Executive Officer Jim Sweetnam. “I am particularly pleased that we’ve begun to demonstrate consistent performance, as evidenced by several consecutive quarters of increasingly positive results. This is the result of sound execution by our global team.
“Each of our business segments – light vehicle driveline, power technologies, commercial vehicle, and off-highway – again generated increases in EBITDA during the third quarter,” he added. “This speaks to the solid progress we continue to make in reinforcing our competitive position and in winning profitable net new business in growing markets.”

 

 

Nine-Month Results
Adjusted EBITDA for the nine months ended September 30, 2010, was $410 million, a nearly $200 million increase from $211 million during the period last year. Sales for the first nine months of 2010 were $4,550 million, which compares with $3,735 million during the same period one year ago. Dana swung to net income of $24 million in the first nine months of 2010, compared to a net loss of $195 million during the same period in 2009.
Dana to Host Third-Quarter Conference Call at 11 a.m. Today
Dana will discuss its third-quarter results in a conference call at 11 a.m. EDT today. Participants may listen to the audio portion of the conference call either through audio streaming online or by telephone. Slide viewing is only available online via a link provided on the Dana Investor website. To dial into the conference call, domestic locations should call 1-888-311-4590 (Conference I.D. # 16259366). International locations should call 1-706-758-0054 (Conference I.D. # 16259366). Please ask for the Dana Holding Corporation Financial Webcast and Conference Call. Phone registration will be available beginning at 10:30 a.m. EDT. An audio recording of the call will be available after 5 p.m. To access this recording, please dial 1-800-642-1687 (U.S. or Canada) or 1-706-645-9291 (international) and enter Conference I.D. # 16259366. A webcast replay will also be available after 5 p.m. today, and may be accessed via the Dana Investor website.
Non-GAAP Measures
This release refers to adjusted EBITDA, which we’ve defined to be earnings before interest, taxes, depreciation, amortization, non-cash equity grant expense, restructuring expense, and other nonrecurring items (gain/loss on debt extinguishment or divestitures, impairment, etc). Adjusted EBITDA is a non-GAAP financial measure, and the measure currently being used by Dana as the primary measure of its operating segment performance. The most significant impact to Dana’s ongoing results of operations as a result of applying fresh start accounting following our emergence from bankruptcy was higher depreciation and amortization.
By using adjusted EBITDA, which is a performance measure that excludes depreciation and amortization, the comparability of results was enhanced. Management also believes that adjusted EBITDA is an important measure since the financial covenants of our primary debt agreements are adjusted EBITDA-based, and our management incentive performance programs are based, in part, on adjusted EBITDA. Because it is a non-GAAP measure, adjusted EBITDA should not be considered a substitute for net income (loss) or other reported results prepared in accordance with GAAP. The financial information accompanying this release provides a reconciliation of adjusted EBITDA for the periods presented to the reported income (loss) before income taxes, which is a GAAP measure.
Free cash flow is also a non-GAAP financial measure, which we have defined as Cash provided by operations (a GAAP measure) exclusive of any bankruptcy claim-related payments included therein, less capital spending. This measure is useful in evaluating the operational cash flow of the company inclusive of the spending required to maintain the operations.

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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,” 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 Holding Corporation
Dana is a world leader in the supply of driveline products (axles and driveshafts), power technologies (sealing and thermal-management products), and genuine service parts for light and heavy manufacturers. The company’s customer base includes virtually every major vehicle manufacturer in the global automotive, commercial vehicle, and off-highway markets. Based in Maumee, Ohio, the company employs approximately 22,500 people in 26 countries and reported 2009 sales of $5.2 billion. For more information, please visit: www.dana.com.
     
Investor Contact
  Media Contact
Lillian Etzkorn: 419.887.5160
  Chuck Hartlage: 419.887.5123

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DANA HOLDING CORPORATION
Consolidated Statement of Operations (Unaudited)
For the Three Months Ended September 30, 2010 and 2009
                 
    Three Months Ended  
    September 30,  
(In millions except per share amounts)   2010     2009  
Net sales
   $ 1,516     $ 1,329  
Costs and expenses
                
Cost of sales
     1,338       1,247  
Selling, general and administrative expenses
     99       73  
Amortization of intangibles
     15       18  
Restructuring charges, net
     10       14  
Other income, net
     10       10  
 
            
Income (loss) before interest, reorganization items and income taxes
     64       (13 )
Interest expense
     22       36  
 
            
Income (loss) before income taxes
     42       (49 )
Income tax benefit
     4       9  
Equity in earnings of affiliates
     1       2  
 
            
Net income (loss)
     47       (38 )
Less: Noncontrolling interests net income
     1          
 
            
Net income (loss) attributable to the parent company
     46       (38 )
Preferred stock dividend requirements
     8       8  
 
            
Net income (loss) available to common stockholders
   $ 38     $ (46 )
 
            
 
                
Net income (loss) per share available to parent company stockholders:
                
Basic
   $ 0.27     $ (0.45 )
Diluted
   $ 0.22     $ (0.45 )
Average common shares outstanding
                
Basic
     141       101  
Diluted
     212       101  
         
        Page 1 of 9

 

 

DANA HOLDING CORPORATION
Consolidated Statement of Operations (Unaudited)
For the Nine Months Ended September 30, 2010 and 2009
                 
    Nine Months Ended  
    September 30,  
(In millions except per share amounts)   2010     2009  
Net sales
   $ 4,550     $ 3,735  
Costs and expenses
                
Cost of sales
     4,063       3,598  
Selling, general and administrative expenses
     292       217  
Amortization of intangibles
     46       53  
Restructuring charges, net
     60       93  
Impairment of long-lived assets
             6  
Other income, net
     9       100  
 
            
Income (loss) before interest, reorganization items and income taxes
     98       (132 )
Interest expense
     68       108  
Reorganization items
             (2 )
 
            
Income (loss) before income taxes
     30       (238 )
Income tax benefit (expense)
     (10 )     39  
Equity in earnings of affiliates
     7       (2 )
 
            
Net income (loss)
     27       (201 )
Less: Noncontrolling interests net income (loss)
     3       (6 )
 
            
Net income (loss) attributable to the parent company
     24       (195 )
Preferred stock dividend requirements
     24       24  
 
            
Net income (loss) available to common stockholders
   $ —     $ (219 )
 
            
 
                
Net income (loss) per share available to parent company stockholders:
                
Basic
   $ —     $ (2.17 )
Diluted
   $ —     $ (2.17 )
Average common shares outstanding
                
Basic
     140       100  
Diluted
     140       100  
         
        Page 2 of 9

 

 

DANA HOLDING CORPORATION
Consolidated Balance Sheet (Unaudited)
As of September 30, 2010 and December 31, 2009
                 
    September 30,     December 31,  
(In millions except per share amounts)   2010     2009  
Assets
                
Current assets
                
Cash and cash equivalents
   $ 1,137     $ 947  
Accounts receivable
                
Trade, less allowance for doubtful accounts of $12 in 2010 and $18 in 2009
     901       728  
Other
     172       141  
Inventories
                
Raw materials
     322       300  
Work in process and finished goods
     367       308  
Other current assets
     91       59  
Current assets held for sale
     5       99  
 
            
Total current assets
     2,995       2,582  
Goodwill
     106       111  
Intangibles
     373       438  
Investments and other assets
     225       233  
Investments in affiliates
     117       112  
Property, plant and equipment, net
     1,351       1,484  
Noncurrent assets held for sale
     3       104  
 
            
Total assets
   $ 5,170     $ 5,064  
 
            
 
                
Liabilities and equity
                
Current liabilities
                
Notes payable, including current portion of long-term debt
   $ 50     $ 34  
Accounts payable
     807       601  
Accrued payroll and employee benefits
     149       103  
Accrued restructuring costs
     37       29  
Taxes on income
     19       40  
Other accrued liabilities
     277       270  
Current liabilities held for sale
     2       79  
 
            
Total current liabilities
     1,341       1,156  
Long-term debt
     903       969  
Deferred employee benefits and other noncurrent liabilities
     1,127       1,160  
Commitments and contingencies
                
 
            
Total liabilities
     3,371       3,285  
Parent company stockholders’ equity
                
Preferred stock, 50,000,000 shares authorized
                
Series A, $.01 par value, 2,500,000 issued and outstanding
     242       242  
Series B, $.01 par value, 5,400,000 issued and outstanding
     529       529  
Common stock, $.01 par value, 450,000,000 shares authorized, 141,143,311 outstanding
     1       1  
Additional paid-in capital
     2,592       2,580  
Accumulated deficit
     (1,169 )     (1,169 )
Treasury stock, at cost
     (2 )        
Accumulated other comprehensive loss
     (492 )     (504 )
 
            
Total parent company stockholders’ equity
     1,701       1,679  
Noncontrolling interests
     98       100  
 
            
Total equity
     1,799       1,779  
 
            
Total liabilities and equity
   $ 5,170     $ 5,064  
 
            
         
        Page 3 of 9

 

 

DANA HOLDING CORPORATION
Consolidated Statement of Cash Flows (Unaudited)
For the Three Months Ended September 30, 2010 and 2009
                 
    Three Months Ended  
    September 30,  
(In millions)   2010     2009  
Cash flows — operating activities
                
Net income (loss)
   $ 47     $ (38 )
Depreciation
     57       79  
Amortization of intangibles
     19       22  
Amortization of deferred financing charges and original issue discount
     7       9  
Loss on extinguishment of debt
     3       5  
Deferred income taxes
     (4 )     (5 )
Pension expense in excess of (less than) contributions
     4          
Change in working capital
     (43 )     84  
Other, net
     5       9  
 
            
Net cash flows provided by operating activities (1)
     95       165  
 
            
 
                
Cash flows — investing activities
                
Purchases of property, plant and equipment (1)
     (36 )     (20 )
Other
     (2 )     1  
 
            
Net cash flows used in investing activities
     (38 )     (19 )
 
            
 
                
Cash flows — financing activities
                
Net change in short-term debt
             (1 )
Proceeds from long-term debt
     51       2  
Repayment of long-term debt
     (47 )     (115 )
Proceeds from issuance of common stock
             229  
Underwriting fee payment
             (12 )
Dividends paid to preferred stockholders
     (16 )        
Dividends paid to noncontrolling interests
     (4 )     (5 )
Other
     1       1  
 
            
Net cash flows provided by (used in) financing activities
     (15 )     99  
 
            
 
                
Net increase in cash and cash equivalents
     42       245  
Cash and cash equivalents — beginning of period
     1,059       553  
Effect of exchange rate changes on cash balances
     36       16  
 
            
Cash and cash equivalents — end of period
   $ 1,137     $ 814  
 
            
 
(1)   Free cash flow of $59 in 2010 and $145 in 2009 is the sum of net cash provided by operating activities reduced by the purchases of property, plant and equipment.
         
        Page 4 of 9

 

 

DANA HOLDING CORPORATION
Consolidated Statement of Cash Flows (Unaudited)
For the Nine Months Ended September 30, 2010 and 2009
                 
    Nine Months Ended  
    September 30,  
($ in millions)   2010     2009  
Cash flows — operating activities
                
Net income (loss)
   $ 27     $ (201 )
Depreciation
     180       231  
Amortization of intangibles
     57       64  
Amortization of deferred financing charges and original issue discount
     20       27  
Loss on sale of business
     5          
Loss (gain) on extinguishment of debt
     7       (35 )
Reorganization-related tax claim payment (1)
     (75 )        
Deferred income taxes
     (10 )     (31 )
Pension expense in excess of (less than) contributions
     13       (5 )
Change in working capital
     (10 )     49  
Other, net
     3       (11 )
 
            
Net cash flows provided by operating activities (1)
     217       88  
 
            
 
                
Cash flows — investing activities
                
Purchases of property, plant and equipment (1)
     (62 )     (74 )
Proceeds from sale of businesses
     113          
Other
     3       3  
 
            
Net cash flows provided by (used in) investing activities
     54       (71 )
 
            
 
                
Cash flows — financing activities
                
Net change in short-term debt
     13       (36 )
Advance received on corporate facility sale
             11  
Proceeds from long-term debt
     52       5  
Repayment of long-term debt
     (135 )     (197 )
Proceeds from issuance of common stock
             229  
Underwriting fee payment
             (12 )
Dividends paid to preferred stockholders
     (32 )        
Dividends paid to noncontrolling interests
     (6 )     (5 )
Other
     2       (2 )
 
            
Net cash flows used in financing activities
     (106 )     (7 )
 
            
 
                
Net increase in cash and cash equivalents
     165       10  
Cash and cash equivalents — beginning of period
     947       777  
Effect of exchange rate changes on cash balances
     25       27  
 
            
Cash and cash equivalents — end of period
   $ 1,137     $ 814  
 
            
 
(1)   Free cash flow of $230 in 2010 and $14 in 2009 is the sum of net cash provided by operating activities (exclusive of reorganization-related claims payments) reduced by the purchases of property, plant and equipment.
         
        Page 5 of 9

 

 

DANA HOLDING CORPORATION
Segment Sales and Adjusted EBITDA (Unaudited)
For the Three Months Ended September 30, 2010 and 2009
                 
    Three Months Ended  
    September 30,  
($ in millions)   2010     2009  
SALES
                
Light Vehicle Driveline
   $ 634     $ 532  
Power Technologies
     235       186  
Commercial Vehicle
     362       270  
Off-Highway
     271       184  
Structures
     13       157  
Other
     1          
 
            
Total Sales
   $ 1,516     $ 1,329  
 
            
 
                
Adjusted EBITDA
                
Light Vehicle Driveline
   $ 67     $ 45  
Power Technologies
     33       14  
Commercial Vehicle
     37       27  
Off-Highway
     23       11  
Structures
             11  
 
            
Segment EBITDA
     160       108  
Shared services and administrative
     (4 )     (5 )
Other expense, net
     (6 )     (2 )
Foreign exchange not in segments
     (2 )        
 
            
Adjusted EBITDA
   $ 148     $ 101  
 
            
         
        Page 6 of 9

 

 

DANA HOLDING CORPORATION
Segment Sales and Adjusted EBITDA (Unaudited)
For the Nine Months Ended September 30, 2010 and 2009
                 
    Nine Months Ended  
    September 30,  
($ in millions)   2010     2009  
SALES
                
Light Vehicle Driveline
   $ 1,861     $ 1,393  
Power Technologies
     697       503  
Commercial Vehicle
     999       796  
Off-Highway
     815       640  
Structures
     175       403  
Other
     3          
 
            
Total Sales
   $ 4,550     $ 3,735  
 
            
 
                
Adjusted EBITDA
                
Light Vehicle Driveline
   $ 177     $ 76  
Power Technologies
     95       14  
Commercial Vehicle
     96       56  
Off-Highway
     69       27  
Structures
     8       20  
 
            
Segment EBITDA
     445       193  
Shared services and administrative
     (13 )     (15 )
Other income (expense), net
     (15 )     30  
Foreign exchange not in segments
     (7 )     3  
 
            
Adjusted EBITDA
   $ 410     $ 211  
 
            
         
        Page 7 of 9

 

 

DANA HOLDING CORPORATION
Reconciliation of Segment and Adjusted EBITDA to
Income (Loss) Before Income Taxes (Unaudited)
For the Three Months Ended September 30, 2010 and 2009
                 
    Three Months Ended  
    September 30,  
($ in millions)   2010     2009  
Segment EBITDA
   $ 160     $ 108  
Shared services and administrative
     (4 )     (5 )
Other expense, net
     (6 )     (2 )
Foreign exchange not in segments
     (2 )        
 
            
Adjusted EBITDA
     148       101  
Depreciation
     (57 )     (79 )
Amortization
     (19 )     (22 )
Restructuring
     (10 )     (14 )
Loss on extinguishment of debt
     (3 )     (5 )
Strategic transaction expenses
             (2 )
Loss on sale of assets, net
     (1 )     (1 )
Stock compensation expense
     (4 )     (3 )
Foreign exchange on intercompany loans and market value adjustments on forwards
     2       6  
Interest expense
     (22 )     (36 )
Interest income
     8       6  
 
            
Income (loss) before income taxes
   $ 42     $ (49 )
 
            
         
        Page 8 of 9

 

 

DANA HOLDING CORPORATION
Reconciliation of Segment and Adjusted EBITDA to
Income (Loss) Before Income Taxes (Unaudited)
For the Nine Months Ended September 30, 2010 and 2009
                 
    Nine Months Ended  
    September 30,  
($ in millions)   2010     2009  
Segment EBITDA
   $ 445     $ 193  
Shared services and administrative
     (13 )     (15 )
Other income (expense), net
     (15 )     30  
Foreign exchange not in segments
     (7 )     3  
 
            
Adjusted EBITDA
     410       211  
Depreciation
     (180 )     (231 )
Amortization
     (57 )     (64 )
Restructuring
     (60 )     (93 )
Impairment
             (6 )
Reorganization items, net
             2  
Gain (loss) on extinguishment of debt
     (7 )     35  
Strategic transaction expenses
             (4 )
Loss on sale of assets, net
     (7 )     (2 )
Stock compensation expense
     (9 )     (7 )
Foreign exchange on intercompany loans, Venezuelan currency devaluation and market value adjustments on forwards
     (13 )     11  
Interest expense
     (68 )     (108 )
Interest income
     21       18  
 
            
Income (loss) before income taxes
   $ 30     $ (238 )
 
            
         
        Page 9 of 9