2Q Profit Up despite Sales Drop at Dana Holding

Date:2013-08-01 Source:www.chinaspv.com

www.chinaspv.com: Shares of auto parts maker Dana Holding Corp. jumped Thursday after it reported that that its second-quarter net income rose 7 percent as lower production costs and restructuring charges offset falling sales.

The company beat Wall Street's earnings expectations, though it just missed projections for revenue. Dana reduced its sales forecast for the year and narrowed the range for its profit forecast.

Dana's shares rose $1.14, or 5.4 percent, to $21.79 Thursday.

Dana said net income was $92 million, or 44 cents per share, up 7 percent from $86 million, or 40 cents per share, a year earlier.

Excluding restructuring, amortization and other one-time items, the company reported adjusted earnings per share of 54 cents. That was two cents higher than analysts expected.

However, revenue fell 7 percent to $1.8 billion, from $1.94 billion a year earlier. Three of the company's four business segments posted lower sales, including a 14.6 percent plunge in sales of parts for commercial vehicles. Analysts surveyed by FactSet, on average, were expecting slightly higher revenue of $1.82 billion.

The company, which makes both new and replacement parts for cars, trucks and equipment for construction, farming and mining, cited continued weakness in the commercial vehicle market in India, as well as continued soft markets for light vehicles in India, Argentina and Venezuela.

Dana also noted that unfavorable currency exchange rates reduced sales by $38 million, and its equipment parts business made a divestiture.

"Looking forward, political and economic uncertainties in a number of countries are putting pressure on volumes and some of our key markets," CEO Roger J. Wood said in the statement.

Dana said it now expects sales for 2013 to total $7 billion, just below its earlier forecast of $7.1 billion, and it expects adjusted earnings per share of about $1.90. The company had previously forecast $1.88 to $1.95. Both those figures exclude the impact of future share repurchases. Analysts had previously predicted earnings of $1.84 per share.