8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 30, 2020

Dana Incorporated

(Exact name of registrant as specified in its charter)

Delaware	1-1063	26-1531856
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification Number)

3939 Technology Drive, Maumee, Ohio 43537

(Address of principal executive offices) (Zip Code)

(419) 887-3000

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol	Name of Each Exchange on which Registered
Common Stock, $.01 par value	DAN	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Items 2.02 and 7.01     Results of Operations and Financial Condition and Regulation FD Disclosure

Dana Incorporated today issued a news release announcing its results for the quarter ended March 31, 2020. A copy of the press release is attached hereto as Exhibit 99.1.

The information in this report is being “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, is not subject to the liabilities of that section and is not deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits. The following item is furnished with this report.

Exhibit No.		Description
	99.1	Dana Incorporated Press Release dated April 30, 2020
	104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		DANA INCORPORATED
Date: April 30, 2020	By:	/s/ Douglas H. Liedberg
	Name:	Douglas H. Liedberg
	Title:	Senior Vice President, General Counsel and Secretary

3

EX-99.1

Exhibit 99.1

DANA INCORPORATED

Quarterly Financial Information and Reconciliations of Non-GAAP Financial Measures

Non-GAAP Financial Measures

Adjusted EBITDA is 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 earnings 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 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 in accordance with 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 discretionary 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 in accordance with GAAP. Free cash flow and adjusted free cash flow may not be comparable to similarly titled measures reported by other companies.

The accompanying financial information provides reconciliations of adjusted EBITDA, diluted adjusted EPS, free cash flow and adjusted free cash flow to the most directly comparable financial measures calculated and presented in accordance with GAAP. We have not provided a reconciliation of our adjusted EBITDA and diluted adjusted EPS outlook to the most comparable GAAP measures of net income (loss) and diluted EPS. Providing net income (loss) 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 (loss) and diluted EPS, including restructuring actions, asset impairments and certain income tax adjustments. The accompanying reconciliations of these non-GAAP measures with the most comparable GAAP measures for the historical periods presented are indicative of the reconciliations that will be prepared upon completion of the periods covered by the non-GAAP guidance.

DANA INCORPORATED

Consolidated Statement of Operations (Unaudited)

For the Three Months Ended March 31, 2020 and 2019

	Three Months Ended
(In millions, except per share amounts)	March 31,
	2020			2019
Net sales	$	1,926		$	2,163
Costs and expenses
Cost of sales		1,720			1,863
Selling, general and administrative expenses		106			136
Amortization of intangibles		3			2
Restructuring charges, net		3			9
Impairment of goodwill		(51	)
Other income (expense), net		4			(13	)
Earnings before interest and income taxes		47			140
Interest income		2			2
Interest expense		29			27
Earnings before income taxes		20			115
Income tax expense (benefit)		(16	)		20
Equity in earnings of affiliates		2			6
Net income		38			101
Less: Noncontrolling interests net income		2			4
Less: Redeemable noncontrolling interests net loss		(2	)		(1	)
Net income attributable to the parent company	$	38		$	98
Net income per share available to common stockholders
Basic	$	0.26		$	0.68
Diluted	$	0.26		$	0.68
Weighted-average shares outstanding—Basic		144.2			143.9
Weighted-average shares outstanding—Diluted		144.8			144.8

DANA INCORPORATED

Consolidated Statement of Comprehensive Income (Unaudited)

For the Three Months Ended March 31, 2020 and 2019

	Three Months Ended
(In millions)	March 31,
	2020			2019
Net income	$	38		$	101
Other comprehensive income (loss), net of tax:
Currency translation adjustments		(154	)		27
Hedging gains and losses		29			5
Defined benefit plans		3			5
Other comprehensive income (loss)		(122	)		37
Total comprehensive income (loss)		(84	)		138
Less: Comprehensive (income) loss attributable to noncontrolling interests		17			(2	)
Less: Comprehensive income attributable to redeemable noncontrolling interests		(6	)		(4	)
Comprehensive income (loss) attributable to the parent company	$	(73	)	$	132

DANA INCORPORATED

Consolidated Balance Sheet (Unaudited)

As of March 31, 2020 and December 31, 2019

(In millions, except share and per share amounts)	March 31,			December 31,
	2020			2019
Assets
Current assets
Cash and cash equivalents	$	628		$	508
Marketable securities		23			19
Accounts receivable
Trade, less allowance for doubtful accounts of $7 in 2020 and $9 in 2019		1,109			1,103
Other		192			202
Inventories		1,213			1,193
Other current assets		142			137
Total current assets		3,307			3,162
Goodwill		441			493
Intangibles		230			240
Deferred tax assets		603			580
Other noncurrent assets		133			120
Investments in affiliates		178			182
Operating lease assets		171			178
Property, plant and equipment, net		2,172			2,265
Total assets	$	7,235		$	7,220
Liabilities and equity
Current liabilities
Short-term debt	$	312		$	14
Current portion of long-term debt		28			20
Accounts payable		1,181			1,255
Accrued payroll and employee benefits		166			206
Taxes on income		44			46
Current portion of operating lease liabilities		42			42
Other accrued liabilities		294			262
Total current liabilities		2,067			1,845
Long-term debt, less debt issuance costs of $26 in 2020 and $28 in 2019		2,335			2,336
Noncurrent operating lease liabilities		134			140
Pension and postretirement obligations		440			459
Other noncurrent liabilities		224			305
Total liabilities		5,200			5,085
Commitments and contingencies
Redeemable noncontrolling interests		175			167
Parent company stockholders’ equity
Preferred stock, 50,000,000 shares authorized, $0.01 par value, no shares outstanding		—			—
Common stock, 450,000,000 shares authorized, $0.01 par value,
144,480,975 and 143,942,539 shares outstanding		2			2
Additional paid-in capital		2,391			2,386
Retained earnings		644			622
Treasury stock, at cost (10,432,777 and 10,111,191 shares)		(156	)		(150	)
Accumulated other comprehensive loss		(1,098	)		(987	)
Total parent company stockholders’ equity		1,783			1,873
Noncontrolling interests		77			95
Total equity		1,860			1,968
Total liabilities and equity	$	7,235		$	7,220

DANA INCORPORATED

Consolidated Statement of Cash Flows (Unaudited)

For the Three Months Ended March 31, 2020 and 2019

	Three Months Ended
(In millions)	March 31,
	2020			2019
Operating activities
Net income	$	38		$	101
Depreciation		85			74
Amortization		4			3
Amortization of deferred financing charges		2			1
Earnings of affiliates, net of dividends received		(2	)		(5	)
Stock compensation expense		4			5
Deferred income taxes		(35	)		(14	)
Pension expense, net		1			4
Impairment of goodwill		51
Change in working capital		(183	)		(175	)
Other, net		(16	)		(10	)
Net cash used in operating activities		(51	)		(16	)
Investing activities
Purchases of property, plant and equipment		(63	)		(98	)
Acquisition of businesses, net of cash acquired		(8	)		(606	)
Purchases of marketable securities		(12	)		(5	)
Proceeds from sales and maturities of marketable securities		6			6
Settlements of undesignated derivatives		(3	)		(20	)
Other, net		(5	)		(1	)
Net cash used in investing activities		(85	)		(724	)
Financing activities
Net change in short-term debt		298			(2	)
Proceeds from long-term debt		4			675
Repayment of long-term debt		(1	)		(9	)
Deferred financing payments					(12	)
Dividends paid to common stockholders		(15	)		(14	)
Distributions to noncontrolling interests		(1	)		(1	)
Contributions from noncontrolling interests		2			1
Repurchases of common stock					(25	)
Other, net		(4	)		(3	)
Net cash provided by financing activities		283			610
Net increase (decrease) in cash, cash equivalents and restricted cash		147			(130	)
Cash, cash equivalents and restricted cash - beginning of period		518			520
Effect of exchange rate changes on cash balances		(29	)		5
Cash, cash equivalents and restricted cash - end of period	$	636		$	395

DANA INCORPORATED

Reconciliation of Net Cash Provided by Operating Activities to

Free Cash Flow and Adjusted Free Cash Flow (Unaudited)

	Three Months Ended
(In millions)	March 31,
	2020			2019
Net cash used in operating activities	$	(51	)	$	(16	)
Purchases of property, plant and equipment		(63	)		(98	)
Free cash flow		(114	)		(114	)
Discretionary pension contributions		—			—
Adjusted free cash flow	$	(114	)	$	(114	)

DANA INCORPORATED

Segment Sales and Segment EBITDA (Unaudited)

For the Three Months Ended March 31, 2020 and 2019

	Three Months Ended
(In millions)	March 31,
	2020			2019
Sales
Light Vehicle	$	808		$	906
Commercial Vehicle		333			431
Off-Highway		532			552
Power Technologies		253			274
Total Sales	$	1,926		$	2,163
Segment EBITDA
Light Vehicle	$	83		$	102
Commercial Vehicle		21			41
Off-Highway		72			82
Power Technologies		30			34
Total Segment EBITDA		206			259
Corporate expense and other items, net		(1	)		(2	)
Adjusted EBITDA	$	205		$	257

DANA INCORPORATED

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

For the Three Months Ended March 31, 2020 and 2019

	Three Months Ended
(In millions)	March 31,
	2020			2019
Segment EBITDA	$	206		$	259
Corporate expense and other items, net		(1	)		(2	)
Adjusted EBITDA		205			257
Depreciation		(85	)		(74	)
Amortization		(4	)		(3	)
Non-service cost components of pension and OPEB costs		(2	)		(6	)
Restructuring charges, net		(3	)		(9	)
Stock compensation expense		(4	)		(5	)
Strategic transaction expenses, net of transaction fee breakup income		(6	)		(13	)
Impairment of goodwill		(51	)
Acquisition related inventory adjustments					(4	)
Non-income tax legal judgment					6
Other items		(3	)		(9	)
Earnings before interest and income taxes		47			140
Interest income		2			2
Interest expense		29			27
Earnings before income taxes		20			115
Income tax expense (benefit)		(16	)		20
Equity in earnings of affiliates		2			6
Net income	$	38		$	101

DANA INCORPORATED

Diluted Adjusted EPS (Unaudited)

For the Three Months Ended March 31, 2020 and 2019

(In millions, except per share amounts)

	Three Months Ended
	March 31,
	2020			2019
Net income attributable to parent company	$	38		$	98
Items impacting income before income taxes:
Restructuring charges		3			9
Amortization		4			4
Strategic transaction expenses, net of transaction breakup fee income		6			13
Acquisition related inventory adjustments					4
Non-income tax legal judgment					(6	)
Impairment of goodwill		51
Loss on deal contingent forward					13
Other items					(1	)
Items impacting income taxes:
Net income tax expense on items above		(3	)		(5	)
Tax benefit attributable to utilization of federal tax credits, state tax law changes and valuation allowance adjustments		(31	)		(16	)
Adjusted net income	$	68		$	113
Diluted shares - as reported		144.8			144.8
Adjusted diluted shares		144.8			144.8
Diluted adjusted EPS	$	0.47		$	0.78

XML

Document and Entity Information	Apr. 30, 2020
Cover [Abstract]
Entity Registrant Name	DANA INC
Amendment Flag	false
Entity Central Index Key	0000026780
Document Type	8-K
Document Period End Date	Apr. 30, 2020
Entity Incorporation State Country Code	DE
Entity File Number	1-1063
Entity Tax Identification Number	26-1531856
Entity Address, Address Line One	3939 Technology Drive
Entity Address, City or Town	Maumee
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	43537
City Area Code	(419)
Local Phone Number	887-3000
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Security 12b Title	Common Stock, $.01 par value
Trading Symbol	DAN
Security Exchange Name	NYSE
Entity Emerging Growth Company	false