EX-99.1 2 l36281aexv99w1.htm EX-99.1 EX-99.1
Exhibit 99.1
(GRAPHIC)
Dana Holding Corporation Reports First-Quarter 2009 Results,
Announces Debt Repurchase Program
  •   Market weakness drives 47-percent sales decline compared to first quarter of 2008
 
  •   Operations aggressively right-sizing to new production levels
 
  •   2009 plan on track despite weak global markets
TOLEDO, Ohio — May 7, 2009 — Dana Holding Corporation (NYSE: DAN) today announced its first-quarter 2009 results.
First-quarter highlights included:
  •   Sales of $1,216 million, a 47-percent decrease compared with 2008, primarily related to lower vehicle production across all market segments.
 
  •   Net loss of $160 million, compared with first-quarter 2008 net income of $663 million. The 2008 results included a one-time gain of $754 million after taxes, related to emergence and adoption of fresh start accounting. Excluding the one-time gain, the comparable first-quarter 2008 net loss was $91 million.
 
  •   Earnings before interest, taxes, depreciation, amortization, and restructuring (EBITDA) of $16 million, compared with $134 million in 2008. The negative impacts associated with volume declines were partially offset by improved operational performance and pricing.
 
  •   A cash balance of $549 million and total liquidity of $687 million at March 31, 2009. Net debt was $679 million.
Declining Global Markets Weaken Results
“Our first-quarter results were hit hard by the continued global recession,” said Dana Chairman & CEO John Devine. “Despite this backdrop, we are making good progress on improving our business through cost reductions, right-sizing our operations, and improving margins and working capital. During the first quarter, we reduced our global workforce by nearly 5,000 employees and reduced fixed costs, achieving total cost reductions of approximately $300 million.
“These efforts have helped preserve adequate liquidity,” Devine added. “At the same time, we also are securing profitable new business with global customers, which will benefit Dana moving forward.”
The effects of the current economic downturn continued during the first quarter of 2009. First-quarter North American light vehicle production decreased by 51 percent compared with the same period last year. Outside North America, light vehicle production declined by 34 percent. Quarterly North American production of Class 8 trucks was down 40 percent and production of medium-duty trucks declined by 44 percent compared with the same period one year ago. Dana’s off-highway sales decreased by 47 percent globally compared with the first quarter of 2008.

 

 

Dana Initiates Debt Repurchase Program
Dana also announced today that it is initiating a Dutch auction tender program to repurchase up to 10 percent of the existing $1.26 billion under its Term Loan Facility. The company anticipates that the repurchase activity under this program will be completed later this month.
Dana to Host First-Quarter Conference Call at 10:30 a.m. Today
Dana will discuss its first-quarter results in a conference call at 10:30 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 Web site. To dial into the conference call, domestic locations should call 1-888-311-4590 (Conference I.D. # 95720792). International locations should call 1-706-758-0054 (Conference I.D. # 95720792). Please ask for the Dana Holding Corporation Financial Webcast and Conference Call. Phone registration will be available beginning at 10 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 the conference I.D. number 95720792. A webcast replay will also be available after 5 p.m. today, and may be accessed via the Dana Investor Web site.
Non-GAAP Measures
In connection with Dana’s emergence from bankruptcy on January 31, 2008 and the application of fresh start accounting in accordance with the provisions of the American Institute of Certified Public Accountants’ Statement of Position 90-7, the post-emergence results of the successor company for the 2 months ended March 31, 2008 and the pre-emergence results of the predecessor company for the one month ended January 31, 2008 are presented separately as successor and predecessor results in the financial statements presented in accordance with generally accepted accounting principles (GAAP). This presentation is required by GAAP as the successor company is considered to be a new entity and the results of the new entity reflect the application of fresh start accounting. For the readers’ convenience and interest in this earnings release, we have combined the separate successor and predecessor periods to derive combined results for the three months ended March 31, 2008. The financial information accompanying this release provides the separate successor and predecessor GAAP results for the applicable periods, along with the combined results described above for the two months of 2008.
This release refers to EBITDA, which we’ve defined to be earnings before interest, taxes, depreciation, amortization and restructuring. EBITDA is a non-GAAP financial measure, and the measure currently being used by Dana as the primary measure of its reportable operating segment performance. EBITDA was selected as the primary measure for operating segment performance as well as a relevant measure of Dana’s overall performance given the enhanced comparability and usefulness after application of fresh start accounting. The most significant impact to Dana’s ongoing results of operations as a result of applying fresh start accounting is higher depreciation and amortization.

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By using EBITDA, which is a performance measure that excludes depreciation and amortization, the comparability of results is enhanced. Management also believes that EBITDA is an important measure since the financial covenants of our primary debt agreements are EBITDA-based, and our management incentive performance programs are based, in part, on EBITDA. Because it is a non-GAAP measure, EBITDA should not be considered a substitute for net income or other reported results prepared in accordance with GAAP. The financial information accompanying this release provides a reconciliation of EBITDA for the periods presented to the reported income (loss) from continuing operations before income taxes, which is a GAAP measure.
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 axles; driveshafts; and structural, sealing, and thermal-management products; as well as genuine service parts. The company’s customer base includes virtually every major vehicle manufacturer in the global automotive, commercial vehicle, and off-highway markets. Based in Toledo, Ohio, the company employs approximately 24,000 people in 26 countries and reported 2008 sales of $8.1 billion. For more information, please visit: www.dana.com.
     
Investor Contact
  Media Contact
Karen Crawford: (419) 535-4635
  Chuck Hartlage: (419) 535-4728
# # #

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DANA HOLDING CORPORATION
Consolidated Statement of Operations (Unaudited)
For the Three Months Ended March 31, 2009 and 2008
                                   
    Dana     Combined (1)     Dana       Prior Dana  
    Three Months     Three Months     Two Months       One Month  
    Ended     Ended     Ended       Ended  
    March 31,     March 31,     March 31,       January 31,  
    2009     2008     2008       2008  
Net sales
   $ 1,216     $ 2,312     $ 1,561       $ 751  
Costs and expenses
                                  
Cost of sales
     1,233       2,205       1,503         702  
Selling, general and administrative expenses
     75       99       65         34  
Amortization of intangibles
     17       12       12            
Realignment charges, net
     50       17       5         12  
Other income, net
     29       40       32         8  
 
                          
Income (loss) from continuing operations before interest, reorganization items and income taxes
     (130 )     19       8         11  
Interest expense (contractual interest of $17 for the one month ended January 31, 2008)
     35       35       27         8  
Reorganization items
     1       107       9         98  
Fresh start accounting adjustments
             1,009                 1,009  
 
                          
Income (loss) from continuing operations before income taxes
     (166 )     886       (28 )       914  
Income tax benefit (expense)
     9       (219 )     (20 )       (199 )
Equity in earnings of affiliates
     (3 )     3       1         2  
 
                          
Income (loss) from continuing operations
     (160 )     670       (47 )       717  
Loss from discontinued operations
             (7 )     (1 )       (6 )
 
                          
Net income (loss)
     (160 )     663       (48 )       711  
Less: Net loss (income) attributable to noncontrolling interests
     3       (4 )     (2 )       (2 )
 
                          
Net income (loss) attributable to the parent company
     (157 )     659       (50 )       709  
Preferred stock dividend requirements
     8       5       5            
 
                          
Net income (loss) available to common stockholders
   $ (165 )   $ 654     $ (55 )     $ 709  
 
                          
 
                                  
Income (loss) per share from continuing operations attributable to parent company stockholders:
                                  
Basic
   $ (1.64 )           $ (0.54 )     $ 4.77  
Diluted
   $ (1.64 )           $ (0.54 )     $ 4.75  
Loss per share from discontinued operations attributable to parent company stockholders:
                                  
Basic
   $ —             $ (0.01 )     $ (0.04 )
Diluted
   $ —             $ (0.01 )     $ (0.04 )
Net income (loss) per share attributable to parent company stockholders:
                                  
Basic
   $ (1.64 )           $ (0.55 )     $ 4.73  
Diluted
   $ (1.64 )           $ (0.55 )     $ 4.71  
Average common shares outstanding
                           
Basic
     100               100         150  
Diluted
     100               100         150  
 
(1)   See “Non-GAAP Measures” in body of press release for comments regarding the presentation of combined information for the three months ended March 31, 2008.

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DANA HOLDING CORPORATION
Consolidated Balance Sheet (Unaudited)
As of March 31, 2009 and December 31, 2008
                 
    March 31,     December 31,  
    2009     2008  
Assets
                
Current assets
                
Cash and cash equivalents
   $ 549     $ 777  
Accounts receivable
                
Trade, less allowance for doubtful accounts of $21 in 2009 and $23 in 2008
     804       827  
Other
     188       170  
Inventories
                
Raw materials
     337       394  
Work in process and finished goods
     434       521  
Other current assets
     117       58  
 
            
Total current assets
     2,429       2,747  
 
                
Goodwill
     103       108  
Intangibles
     538       569  
Investments and other assets
     187       207  
Investments in affiliates
     132       135  
Property, plant and equipment, net
     1,758       1,841  
 
            
Total assets
   $ 5,147     $ 5,607  
 
            
 
                
Liabilities and equity
                
Current liabilities
                
Notes payable, including current portion of long-term debt
   $ 44     $ 70  
Liability for advance received on corporate facility sale
     11          
Accounts payable
     613       824  
Accrued payroll and employee benefits
     168       185  
Taxes on income
     89       93  
Other accrued liabilities
     257       274  
 
            
Total current liabilities
     1,182       1,446  
 
                
Long-term debt
     1,184       1,181  
Deferred employee benefits and other non-current liabilities
     886       845  
Commitments and contingencies (Note 18)
                
 
            
Total liabilities
     3,252       3,472  
 
                
Parent company stockholders’ equity
                
Preferred stock, 50,000,000 shares authorized
                
Series A, $0.01 par value, 2,500,000 issued and outstanding
     242       242  
Series B, $0.01 par value, 5,400,000 issued and outstanding
     529       529  
Common stock, $.01 par value, 450,000,000 authorized, 100,074,997 issued and outstanding
     1       1  
Additional paid-in capital
     2,323       2,321  
Accumulated deficit
     (871 )     (706 )
Accumulated other comprehensive loss
     (428 )     (359 )
 
            
Total parent company stockholders’ equity
     1,796       2,028  
Noncontrolling interests
     99       107  
 
            
Total equity
     1,895       2,135  
 
            
Total liabilities and equity
   $ 5,147     $ 5,607  
 
            

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DANA HOLDING CORPORATION
Consolidated Statement of Cash Flows (Unaudited)
For the Three Months Ended March 31, 2009 and 2008
                                   
    Dana     Combined     Dana       Prior Dana  
    Three Months     Three Months     Two Months       One Month  
    Ended     Ended     Ended       Ended  
    March 31,     March 31,     March 31,       January 31,  
    2009     2008 (1)     2008       2008  
Cash flows — operating activities
                                  
Income (loss) attributable to the parent company
   $ (157 )   $ 659     $ (50 )     $ 709  
Income (loss) attributable to noncontrolling interests
     (3 )     4       2         2  
 
                          
Net income (loss)
     (160 )     663       (48 )       711  
Depreciation
     73       70       47         23  
Amortization of intangibles
     21       15       15            
Amortization of inventory valuation
             45       45            
Amortization of deferred financing charges and original issue discount
     7       4       4            
Deferred income taxes
     (13 )     189       (2 )       191  
Reorganization:
                                  
Gain on settlement of liabilities subject to compromise
             (27 )               (27 )
Payment of claims (2)
             (88 )     (88 )          
Reorganization items net of cash payments
     (1 )     61       (18 )       79  
Fresh start adjustments
             (1,009 )               (1,009 )
Payments to VEBAs (2)
             (788 )     (733 )       (55 )
Loss (gain) on sale of businesses and assets
     (1 )     8       1         7  
Change in working capital
     (112 )     (189 )     (128 )       (61 )
Other, net
     12       (3 )     (22 )       19  
 
                          
Net cash flows used in operating activities (2)
     (174 )     (1,049 )     (927 )       (122 )
 
                                  
Cash flows — investing activities
                                  
Purchases of property, plant and equipment (2)
     (30 )     (45 )     (29 )       (16 )
Proceeds from sale of businesses and assets
             5                 5  
Change in restricted cash
             93                 93  
Other
             3       8         (5 )
 
                          
Net cash flows provided by (used in) investing activities
     (30 )     56       (21 )       77  
 
                                  
Cash flows — financing activities
                                  
Repayment of debtor-in-possession facility
             (900 )               (900 )
Net change in short-term debt
     (24 )     (25 )     (7 )       (18 )
Proceeds from sale of fixed assets
     11                            
Payment of DCC Medium Term Notes
             (136 )               (136 )
Proceeds from Exit Facility debt
             1,430       80         1,350  
Original issue discount
             (114 )               (114 )
Deferred financing payments
             (40 )               (40 )
Repayment of Exit Facility debt
     (3 )     (4 )     (4 )          
Issuance of Series A and Series B preferred stock
             771                 771  
Other
     2       (6 )     (5 )       (1 )
 
                          
Net cash flows provided by (used in) financing activities
     (14 )     976       64         912  
 
                                  
Net increase (decrease) in cash and cash equivalents
     (218 )     (17 )     (884 )       867  
Cash and cash equivalents — beginning of period
     777       1,271       2,147         1,271  
Effect of exchange rate changes on cash balances
     (10 )     25       20         5  
Net change in cash of discontinued operations
             4                 4  
 
                          
Cash and cash equivalents — end of period
   $ 549     $ 1,283     $ 1,283       $ 2,147  
 
                          
 
(1)   See “Non-GAAP Measures” in body of press release for comments regarding the presentation of combined information for the three months ended March 31, 2008.
 
(2)   Free cash flow of ($204) in 2009 and ($218) in 2008 is the sum of net cash provided by (used in) operating activities (excluding claims payments) reduced by the purchases of property, plant and equipment.

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DANA HOLDING CORPORATION
SEGMENT SALES AND EBITDA
For the Three Months Ended March 31, 2009 and 2008
                                   
    Dana     Combined (1)     Dana       Prior Dana  
    Three Months     Three Months     Two Months       One Month  
    Ended     Ended     Ended       Ended  
    March 31,     March 31,     March 31,       January 31,  
    2009     2008     2008       2008  
SALES
                                  
Light Vehicle Driveline
   $ 424     $ 861     $ 579       $ 282  
Sealing
     117       195       131         64  
Thermal
     39       80       52         28  
Structures
     117       270       180         90  
Commercial Vehicle
     257       405       276         129  
Off-Highway
     262       499       342         157  
Other
             2       1         1  
 
                          
Total Sales
   $ 1,216     $ 2,312     $ 1,561       $ 751  
 
                          
 
                                  
EBITDA
                                  
Light Vehicle Driveline
   $ (7 )   $ 37     $ 27       $ 10  
Sealing
     (2 )     19       13         6  
Thermal
     1       6       3         3  
Structures
     8       18       14         4  
Commercial Vehicle
     6       22       16         6  
Off-Highway
     11       42       28         14  
 
                          
Segment EBITDA
     17       144       101         43  
Shared services and administrative
     (5 )     (6 )     (3 )       (3 )
Other income (expense), net
     (1 )     (6 )     (4 )       (2 )
Foreign exchange not in segments
     5       2       2            
 
                          
EBITDA
   $ 16     $ 134     $ 96       $ 38  
 
                          
 
(1)   See “Non-GAAP Measures” in body of press release for comments regarding the presentation of combined information for the three months ended March 31, 2008.

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DANA HOLDING CORPORATION
SEGMENT EBITDA RECONCILIATION (Unaudited)
Reconciliation of Segment EBITDA to Income (Loss)
from Continuing Operations Before Income Taxes
For the Three Months Ended March 31, 2009 and 2008
                                   
    Dana     Combined (1)     Dana       Prior Dana  
    Three Months     Three Months     Two Months       One Month  
    Ended     Ended     Ended       Ended  
    March 31,     March 31,     March 31,       January 31,  
    2009     2008     2008       2008  
Segment EBITDA
   $ 17     $ 144     $ 101       $ 43  
Shared services and administrative
     (5 )     (6 )     (3 )       (3 )
Other income (expense), net
     (1 )     (6 )     (4 )       (2 )
Foreign exchange not in segments
     5       2       2            
 
                          
EBITDA
     16       134       96         38  
Depreciation
     (73 )     (70 )     (47 )       (23 )
Amortization
     (21 )     (60 )     (60 )          
Realignment
     (50 )     (17 )     (5 )       (12 )
Reorganization items, net
     (1 )     (107 )     (9 )       (98 )
Loss on sale of assets, net
     (1 )                          
Stock compensation expense
     (2 )                          
Foreign exchange on intercompany loans and market value adjustments on hedges
     (5 )     17       13         4  
Interest expense
     (35 )     (35 )     (27 )       (8 )
Interest income
     6       15       11         4  
Fresh start accounting adjustments
             1,009                 1,009  
 
                          
Income (loss) from continuing operations before income taxes
   $ (166 )   $ 886     $ (28 )     $ 914  
 
                          
 
(1)   See “Non-GAAP Measures” in body of press release for comments regarding the presentation of combined information for the three months ended March 31, 2008.

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