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Dana Incorporated Announces Revenue and Profit Growth in Third Quarter, Affirms Full-year Guidance Ranges

MAUMEE, Ohio, Oct. 29, 2018 /PRNewswire/ --

Dana Incorporated logo. (PRNewsFoto/Dana Incorporated)

Highlights

  • Sales of $1.98 billion, an 8 percent increase of $147 million
  • Net income attributable to Dana of $95 million; diluted EPS of $0.65
  • Adjusted EBITDA of $240 million, providing a margin of 12.1 percent
    • Profit increase of $24 million over third quarter last year
    • Margin increase of 30 basis points over third quarter last year
  • Diluted adjusted EPS of $0.77, an improvement of 31 percent over third quarter last year 
  • Operating cash flow of $124 million; free cash flow of $34 million
  • Announced strategic acquisition of Oerlikon Drive Systems, enhancing electrification capabilities and off-highway portfolio
  • Significant new business wins and key production launches
  • Nominated eighth consecutive year for Automotive News PACE Award

Dana Incorporated (NYSE: DAN) today announced strong financial results for the third quarter of 2018.

"In the third quarter, Dana continued its strong revenue growth, a result of improved end-market demand, market share gains, and the launch of our strong sales backlog, including our class-leading Spicer SmartConnect™ all-wheel drive system featuring Spicer® AdvanTEK® axle technology, which was recently named a finalist for the prestigious PACE Award," said James Kamsickas, Dana president and chief executive officer.  "Our team also continues to execute on strategic inorganic priorities, highlighted by the recent announcement of a definitive agreement to acquire the Drive Systems segment of the Oerlikon Group.  Combined with the recent acquisition of TM4, Dana is the only mobility supplier with full e-Propulsion system capability."  

Third-quarter 2018 Financial Results

Sales for the third quarter of 2018 totaled $1.98 billion, compared with $1.83 billion in the same period of 2017, representing an 8 percent increase.  Adjusted for currency translations, due primarily to weaker Latin American currencies compared with the U.S. dollar, sales increased 10 percent over the same period last year.  This double-digit growth on a constant currency basis was mainly the result of continued high demand across all three end markets and conversion of sales backlog.

Dana reported net income of $95 million for the third quarter of 2018, compared with net income of $69 million in the same period of 2017, primarily due to increased operating earnings associated with higher sales.

Diluted earnings per share were $0.65, compared with earnings per share of $0.46 in 2017.

Adjusted EBITDA for the third quarter of 2018 was $240 million, an increase of $24 million, or 11 percent, over the same period last year.  This was driven principally by higher end-market demand, conversion of the sales backlog, and acquisition synergies while being partially offset by the effects of currency translation and higher commodity costs.  Adjusted EBITDA margin was 12.1 percent in this year's third quarter, a 30 basis-point improvement over last year.  Stronger sales and operational performance more than offset the margin headwind attributable to the effects of higher raw material prices and the associated material recovery reflected in sales.

Diluted adjusted earnings per share were $0.77 in the third quarter of 2018, compared with $0.59 in the same period last year, reflecting the higher year-over-year operational earnings improvement.  

Operating cash flow in the third quarter of 2018 was $124 million, compared with $181 million in the same period of 2017.  Higher working-capital requirements to meet increased demand and elevated cash taxes due to regional profit mix more than offset the benefit of stronger earnings.  In combination with slightly higher capital spend, free cash flow was $34 million in the third quarter of this year, compared with $99 million in 2017.  

Company Affirms 2018 Guidance Ranges
Sales for this year are expected to be at the high end of the company's guidance range, resulting in 12 percent growth over last year.  The year-over-year improvement is due principally to continued strong end-market demand and conversion of its new-business backlog.  With the increased level of commodity cost inflation, associated recoveries are expected to comprise approximately $65 million of the year-over-year sales comparison.

Adjusted EBITDA in 2018 is now expected to improve by approximately $130 million from 2017 for a margin improvement of 40 basis points.  This improvement is driven primarily by higher sales levels, ongoing efficiency benefits, and acquisition synergies.  The expected full-year margin reduction attributable to inflationary material recoveries of $65 million in sales and higher raw material costs of $105 million approximates 70 basis points.  

Free cash flow is expected to be approximately 3 percent of sales due to slightly lower adjusted EBITDA and a higher level of working capital required by accelerating customer demand and the timing of new business ramp-up.

"As we finish strong this year, we are positioning our operations for continued profitable growth," said Jonathan Collins, executive vice president and chief financial officer of Dana.  "Through the third quarter, we have achieved 15 percent year-over-year sales and profit growth, despite rising material costs.  Over the last three years, we have improved margins an average of 40 basis points per year, and we remain confident in our business performance and our ability to continue to improve margin."

2018 Full-year Financial Targets

  • Sales of $7,750 to $8,050 million;
  • Adjusted EBITDA of $950 to $1,010 million, an implied adjusted EBITDA margin of approximately 12.0 percent;
  • Diluted adjusted EPS1 of $2.75 to $3.05;
  • Operating cash flow of approximately 7.0 percent of sales;
  • Capital spending of approximately 4.0 percent of sales; and
  • Free cash flow of approximately 3.0 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 9 a.m. Today
Dana will discuss its third-quarter results in a conference call at 9 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 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. 4569318 and ask for the "Dana Incorporated's Financial Webcast and Conference Call."  Phone registration will be available starting at 8:30 a.m. EDT

An audio recording of the webcast will be available after 5 p.m. EDT on Oct. 29 by dialing 1-855-859-2056 (U.S. or Canada) or 1-404-537-3406 (international) and entering conference I.D. 4569318.  A webcast replay will also be available after 5 p.m. EDT and may be accessed via Dana's investor website.

Non-GAAP Financial Information

This release refers to adjusted EBITDA, a non-GAAP financial measure which we have defined as net income before interest, 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 cash provided by (used in) operating activities, less purchases of property, plant, and equipment.  We believe this measure is useful to investors in evaluating the operational cash flow of the company inclusive of the spending required to maintain the operations.  Free cash flow is neither 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 may not be comparable to similarly titled measures reported by other companies.

The accompanying financial information provides reconciliations of adjusted EBITDA, diluted adjusted EPS and 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 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.  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.

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, where 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," 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 Incorporated

Dana is a world leader in highly engineered solutions for improving the efficiency, performance, and sustainability of powered vehicles and machinery.  Dana supports the passenger vehicle, commercial truck, and off-highway markets, as well as industrial and stationary equipment applications.  Founded in 1904, Dana employs more than 30,000 people in 33 countries on six continents who are committed to delivering long-term value to customers.  Based in Maumee, Ohio, USA, the company reported sales of $7.2 billion in 2017. Dana is ranked among the Drucker Institute's listing of the 250 most effectively managed companies.   For more information, please visit dana.com.

 

 DANA INCORPORATED 







 Consolidated Statement of Operations (Unaudited) 







 For the Three Months Ended September 30, 2018 and 2017 


















Three Months Ended

 (In millions, except per share amounts) 



September 30,





2018


2017

 Net sales 




$      1,978


$      1,831

 Costs and expenses 






     Cost of sales 



1,692


1,562

     Selling, general and administrative expenses 



119


124

     Amortization of intangibles 



2


4

     Restructuring charges, net 



9


2

 Other expense, net 



(9)



 Earnings before interest and income taxes 



147


139

 Loss on extinguishment of debt 





(13)

 Interest income 



3


3

 Interest expense 



24


25

 Earnings before income taxes 



126


104

 Income tax expense 



31


33

 Equity in earnings of affiliates 



1


2

 Net income 



96


73

     Less: Noncontrolling interests net income 



1


3

     Less: Redeemable noncontrolling interests net income 




1

 Net income attributable to the parent company 



$            95


$            69








 Net income per share available to common stockholders 





    Basic 




$        0.66


$        0.47

    Diluted 




$        0.65


$        0.46








 Weighted-average shares outstanding - Basic 



144.7


145.0

 Weighted-average shares outstanding - Diluted 



145.9


146.9








 Cash dividends declared per share 



$        0.10


$        0.06

 

 DANA INCORPORATED 







 Consolidated Statement of Operations (Unaudited) 







 For the Nine Months Ended September 30, 2018 and 2017 


















Nine Months Ended

 (In millions, except per share amounts) 



September 30,





2018


2017

 Net sales 




$      6,170


$      5,372

 Costs and expenses 






     Cost of sales 



5,269


4,562

     Selling, general and administrative expenses 



383


377

     Amortization of intangibles 



6


9

     Restructuring charges, net 



17


14

 Impairment of indefinite-lived intangible asset 



(20)



 Adjustment in fair value of disposal group held for sale 


3



 Other expense, net 



(19)


(12)

 Earnings before interest and income taxes 



459


398

 Loss on extinguishment of debt 





(19)

 Interest income 



8


8

 Interest expense 



71


79

 Earnings before income taxes 



396


308

 Income tax expense 



75


94

 Equity in earnings of affiliates 



13


12

 Net income 



334


226

     Less: Noncontrolling interests net income 



6


13

     Less: Redeemable noncontrolling interests net income (loss) 


1


(2)

 Net income attributable to the parent company 



$         327


$         215








 Net income per share available to common stockholders 





    Basic 




$        2.25


$        1.46

    Diluted 




$        2.23


$        1.45








 Weighted-average shares outstanding - Basic 



145.1


144.8

 Weighted-average shares outstanding - Diluted 



146.6


146.5








 Cash dividends declared per share 



$        0.30


$        0.18

 

 DANA INCORPORATED 






 Consolidated Statement of Comprehensive Income (Unaudited) 






 For the Three Months Ended September 30, 2018 and 2017 



















Three  Months Ended

 (In millions) 


September 30,






2018


2017

 Net income 


$            96


$            73

 Other comprehensive income (loss), net of tax: 






Currency translation adjustments


(19)


(1)


Hedging gains and losses


3


(14)


Defined benefit plans


21


19


Other comprehensive income


5


4

Total comprehensive income


101


77


Less: Comprehensive income attributable to noncontrolling interests




(5)


Less: Comprehensive income attributable to redeemable noncontrolling interests




(1)

Comprehensive income attributable to the parent company


$         101


$            71

 

 

 DANA INCORPORATED 






 Consolidated Statement of Comprehensive Income (Unaudited) 






 For the Nine Months Ended September 30, 2018 and 2017 



















Nine  Months Ended

 (In millions) 


September 30,






2018


2017

 Net income 


$         334


$         226

 Other comprehensive income (loss), net of tax: 






Currency translation adjustments


(65)


(2)


Hedging gains and losses


(11)


(13)


Defined benefit plans


34


29


Other comprehensive income (loss)


(42)


14

Total comprehensive income


292


240


Less: Comprehensive income attributable to noncontrolling interests




(18)


Less: Comprehensive income attributable to redeemable noncontrolling interests





Comprehensive income attributable to the parent company


$         292


$         222

 

 

 

 DANA INCORPORATED 




 Consolidated Balance Sheet (Unaudited) 




 As of September 30, 2018 and December 31, 2017 








 (In millions, except share and per share amounts) 

September 30,


December 31,


2018


2017

 Assets 





 Current assets 




 Cash and cash equivalents 

$                322


$                603

 Marketable securities 

36


40

 Accounts receivable 




      Trade, less allowance for doubtful accounts of $8 in 2018 and 2017 

1,228


994

      Other 

173


172

 Inventories 

1,100


969

 Other current assets 

103


97

 Current assets of disposal group held for sale 



7

           Total current assets 

2,962


2,882

 Goodwill 

249


127

 Intangibles 

173


174

 Deferred tax assets 

443


420

 Other noncurrent assets 

76


71

 Investments in affiliates 

216


163

 Property, plant and equipment, net 

1,828


1,807

           Total assets 

$             5,947


$             5,644







 Liabilities and equity 




 Current liabilities 




 Short-term debt and current portion of long-term debt 

$                   36


$                   40

 Accounts payable 

1,246


1,165

 Accrued payroll and employee benefits 

196


219

 Taxes on income 

67


53

 Other accrued liabilities 

254


220

 Current liabilities of disposal group held for sale 



5

           Total current liabilities 

1,799


1,702

 Long-term debt, less debt issuance costs of $19 in 2018 and $22 in 2017 

1,760


1,759

 Pension and postretirement obligations 

553


607

 Other noncurrent liabilities 

368


413

 Noncurrent liabilities of disposal group held for sale 



2

           Total liabilities 

4,480


4,483

 Commitments and contingencies 






 Redeemable noncontrolling interests 



103


47

 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, 




           144,662,794 and 144,984,050 shares outstanding 

2


2

      Additional paid-in capital 

2,364


2,354

      Retained earnings 

371


86

      Treasury stock, at cost (8,341,922 and 7,001,017 shares) 

(119)


(87)

      Accumulated other comprehensive loss 

(1,379)


(1,342)

           Total parent company stockholders' equity 

1,239


1,013

 Noncontrolling interests 

125


101

           Total equity 

1,364


1,114

           Total liabilities and equity 

$             5,947


$             5,644

 

 DANA INCORPORATED 





 Consolidated Statement of Cash Flows (Unaudited) 





 For the Three Months Ended September 30, 2018 and 2017 













Three Months Ended

 (In millions) 


September 30,




2018


2017

 Operating activities 





 Net income 


$            96


$            73

 Depreciation 


63


58

 Amortization of intangibles 


3


4

 Amortization of deferred financing charges 


1


1

 Call premium on debt 




10

 Write-off of deferred financing costs 




3

 Earnings of affiliates, net of dividends received 




4

 Stock compensation expense 


4


7

 Deferred income taxes 


(2)


5

 Pension contributions, net 


1


(1)

 Change in working capital 


(37)


24

 Other, net 


(5)


(7)

 Net cash provided by operating activities (1) 


124


181







 Investing activities 





 Purchases of property, plant and equipment (1) 


(90)


(82)

 Proceeds from sale of subsidiary, net of cash disposed 


(6)



 Purchases of marketable securities 


(7)


(6)

 Proceeds from maturities of marketable securities 


7


3

 Other, net 


(2)



 Net cash used in investing activities 


(98)


(85)







 Financing activities 





 Net change in short-term debt 


(8)


(17)

 Proceeds from long-term debt 




276

 Repayment of long-term debt 


(6)


(352)

 Call premium on debt 




(10)

 Deferred financing payments 




(3)

 Dividends paid to common stockholders 


(14)


(9)

 Distributions to noncontrolling interests 


(3)


(4)

 Contributions from noncontrolling interests 


22



 Payments to acquire redeemable noncontrolling interests 


(43)



 Other, net 




3

 Net cash used in financing activities 


(52)


(116)







 Net decrease in cash, cash equivalents and restricted cash 


(26)


(20)

 Cash, cash equivalents and restricted cash − beginning of period (2) 


343


577

 Effect of exchange rate changes on cash balances 




11

 Less: Cash contributed to disposal group held for sale 


10



 Cash, cash equivalents and restricted cash − end of period (2) 


$         327


$         568







(1)

Free cash flow of $34 in 2018 and $99 in 2017 is the sum of net cash provided by 




operating activities reduced by the purchases of property, plant and equipment.









(2)

Includes restricted cash of $5 at September 30, 2018, $4 at June 30, 2018,




$10 at September 30, 2017 and $9 at June 30, 2017.





 

 

 

 DANA INCORPORATED 





 Consolidated Statement of Cash Flows (Unaudited) 





 For the Nine Months Ended September 30, 2018 and 2017 













Nine Months Ended

 (In millions) 


September 30,




2018


2017

 Operating activities 





 Net income 


$         334


$         226

 Depreciation 


187


162

 Amortization of intangibles 


8


10

 Amortization of deferred financing charges 


3


4

 Call premium on debt 




15

 Write-off of deferred financing costs 




4

 Earnings of affiliates, net of dividends received 


5


2

 Stock compensation expense 


13


17

 Deferred income taxes 


(47)


10

 Pension contributions, net 


2


(4)

 Impairment of indefinite-lived intangible asset 


20



 Gain on sale of subsidiary 




(3)

 Adjustment in fair value of disposal group held for sale 


(2)



 Change in working capital 


(269)


(80)

 Other, net 


(17)


(2)

 Net cash provided by operating activities (1) 


237


361







 Investing activities 





 Purchases of property, plant and equipment (1) 


(235)


(251)

 Acquisition of businesses, net of cash acquired 


(151)


(182)

 Proceeds from previous acquisition 


9



 Proceeds from sale of subsidiary, net of cash disposed 


(6)


3

 Purchases of marketable securities 


(36)


(23)

 Proceeds from sales of marketable securities 


6


1

 Proceeds from maturities of marketable securities 


30


16

 Other, net 


(2)


(1)

 Net cash used in investing activities 


(385)


(437)







 Financing activities 





 Net change in short-term debt 


(13)


(96)

 Proceeds from long-term debt 




676

 Repayment of long-term debt 


(8)


(640)

 Call premium on debt 




(15)

 Deferred financing payments 




(9)

 Dividends paid to common stockholders 


(43)


(26)

 Distributions to noncontrolling interests 


(7)


(7)

 Repurchases of common stock 


(25)



 Contributions from noncontrolling interests 


22



 Payments to acquire redeemable noncontrolling interests 


(43)



 Other, net 


(5)


4

 Net cash used in financing activities 


(122)


(113)







 Net decrease in cash, cash equivalents and restricted cash 


(270)


(189)

 Cash, cash equivalents and restricted cash − beginning of period (2) 


610


716

 Effect of exchange rate changes on cash balances 


(13)


41

 Cash, cash equivalents and restricted cash − end of period (2) 


$         327


$         568







(1)

Free cash flow of $2 in 2018 and $110 in 2017 is the sum of net cash provided by 




operating activities reduced by the purchases of property, plant and equipment.









(2)

Includes restricted cash of $5 at September 30, 2018, $7 at December 31, 2017,




$10 at September 30, 2017 and $9 at December 31, 2016.





 

 

 DANA INCORPORATED 






 Segment Sales and Segment EBITDA (Unaudited) 



 For the Three Months Ended September 30, 2018 and 2017 















Three Months Ended

 (In millions) 



September 30,




2018


2017

Sales 






  Light Vehicle



$           879


$           805

  Commercial Vehicle



406


371

  Off-Highway



425


384

  Power Technologies



268


271

Total Sales 



$        1,978


$        1,831







Segment EBITDA 






  Light Vehicle



$           102


$             91

  Commercial Vehicle



39


33

  Off-Highway



69


55

  Power Technologies



33


41

Total Segment EBITDA 



243


220

Corporate expense and other items, net 



(3)


(4)

Adjusted EBITDA 



$           240


$           216

 

 

 DANA INCORPORATED 






 Segment Sales and Segment EBITDA (Unaudited) 



 For the Nine Months Ended September 30, 2018 and 2017 















Nine Months Ended

 (In millions) 



September 30,




2018


2017

Sales 






  Light Vehicle



$        2,702


$        2,369

  Commercial Vehicle



1,217


1,057

  Off-Highway



1,402


1,107

  Power Technologies



849


839

Total Sales 



$        6,170


$        5,372







Segment EBITDA 






  Light Vehicle



$           297


$           273

  Commercial Vehicle



114


91

  Off-Highway



220


157

  Power Technologies



117


132

Total Segment EBITDA 



748


653

Corporate expense and other items, net 



(14)


(15)

Adjusted EBITDA 



$           734


$           638

 

 

 

 DANA INCORPORATED 





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

 For the Three Months Ended September 30, 2018 and 2017 












Three Months Ended

 (In millions) 


September 30,



2018


2017

Segment EBITDA 


$           243


$           220

  Corporate expense and other items, net


(3)


(4)

Adjusted EBITDA 


240


216

  Depreciation


(63)


(58)

  Amortization of intangibles


(3)


(4)

  Non-service cost components of pension and OPEB costs


(3)



  Restructuring


(9)


(2)

  Stock compensation expense


(4)


(7)

  Strategic transaction expenses


(6)


(3)

  Amounts attributable to previously divested/closed operations




(1)

  Other items


(5)


(2)

Earnings before interest and income taxes 


147


139

  Loss on extinguishment of debt




(13)

  Interest expense


(24)


(25)

  Interest income


3


3

Earnings before income taxes 


126


104

Income tax expense 


31


33

Equity in earnings of affiliates 


1


2

Net income 


$             96


$             73

 

 

 DANA INCORPORATED 





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

 For the Nine Months Ended September 30, 2018 and 2017 












Nine Month Ended

 (In millions) 


September 30,



2018


2017

Segment EBITDA 


$           748


$           653

  Corporate expense and other items, net


(14)


(15)

Adjusted EBITDA 


734


638

 Depreciation


(187)


(162)

 Amortization of intangibles


(8)


(10)

 Non-service cost components of pension and OPEB costs


(10)



 Restructuring


(17)


(14)

 Stock compensation expense


(13)


(17)

 Strategic transaction expenses, net of transaction breakup fee income


(13)


(20)

 Acquisition related inventory adjustments




(14)

 Impairment of indefinite-lived intangible asset


(20)



 Adjustment in fair value of disposal group held for sale


3



 Amounts attributable to previously divested/closed operations




2

 Other items


(10)


(5)

Earnings before interest and income taxes 


459


398

 Loss on extinguishment of debt




(19)

 Interest expense


(71)


(79)

 Interest income


8


8

Earnings before income taxes 


396


308

Income tax expense 


75


94

Equity in earnings of affiliates 


13


12

Net income 


$           334


$           226

 

 

 DANA INCORPORATED 






 Diluted Adjusted EPS (Unaudited) 





 For the Three Months Ended September 30, 2018 and 2017 











 (In millions, except per share amounts) 








Three Months Ended




September 30,




2018


2017

 Net income attributable to parent company 


$             95


$             69

 Items impacting income before income taxes: 





      Restructuring charges 


9


2

      Amortization of intangibles 


3


4

      Strategic transaction expenses 


6


3

      Loss on extinguishment of debt 




13

      Other items 


5


3

 Items impacting income taxes: 





      Net income tax expense on items above 


(5)


(8)

 Adjusted net income 


$           113


$             86







 Diluted shares - as reported 


145.9


146.9

 Adjusted diluted shares 


145.9


146.9







 Diluted adjusted EPS 


$          0.77


$          0.59

 

 

 

 DANA INCORPORATED 





 Diluted Adjusted EPS (Unaudited) 





 For the Nine Months Ended September 30, 2018 and 2017 











 (In millions, except per share amounts) 








Nine Months Ended




September 30,




2018


2017

 Net income attributable to parent company 


$           327


$           215

 Items impacting income before income taxes: 






 Restructuring charges 


17


14


 Amortization of intangibles 


8


10


 Strategic transaction expenses 


13


20


 Impairment of indefinite-lived intangible asset 


20




 Loss on extinguishment of debt 




19


 Acquisition related inventory adjustments 




14


 Other items 


3


3

 Items impacting income taxes: 






 Net income tax expense on items above 


(15)


(17)


 Tax benefit attributable to utilization of federal tax credits, state tax 






     law changes and associated valuation allowance release 


(46)




 Tax expense attributable to international legal entity reorganization 






     and retroactive application of new tax authority adminstrative policy 


5



 Adjusted net income 


$           332


$           278







 Diluted shares - as reported 


146.6


146.5

 Adjusted diluted shares 


146.6


146.5







 Diluted adjusted EPS 


$          2.26


$          1.90

 

 

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SOURCE Dana Incorporated

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