Greater operational efficiencies, improved pricing terms, execution of a global footprint plan, expansion in emerging markets and new business awards have increased ArvinMeritor, Inc.'s sales from continuing operations to $1.7 billion, up $95 million from the same period last year. The company, a global supplier of integrated systems, modules and components to the motor vehicle industry, recently reported its first-quarter fiscal year 2008 results. "We demonstrated stronger operating performance this quarter despite Class 8 volumes being down approximately 50 percent in North America," says Chip McClure, the company's chairman, CEO and president. "The actions we have implemented through our Performance Plus program, particularly in Europe, are gaining traction and driving improved EBITDA and margins." Highlights from the first quarter include:
For the first quarter of fiscal year 2008, ArvinMeritor posted sales from continuing operations of $1.7 billion. Despite a weak economy in North America and challenging global industry conditions, sales were up compared to the first quarter of last year for both Commercial Vehicle Systems (CVS) and Light Vehicle Systems (LVS), due in part to favorable currency exchange rates. EBITDA, before special items, was $82 million, up $10 million from the same period last year. This increase is primarily due to improved CVS operating results driven by the company's Performance Plus program. On a GAAP basis, the company's net loss from continuing operations was $1 million or $0.01 per diluted share, compared to net income from continuing operations of $10 million or $0.14 per diluted share in the same period last year. Income from continuing operations, before special items, was $6 million, or $0.08 per diluted share, compared to $12 million, or $0.17 per diluted share, a year ago. Special items for the quarter include charges associated with the company's previously announced restructuring program. The decrease in earnings this quarter reflects certain charges incurred during the first quarter of fiscal year 2008, including $0.09 per diluted share for a legal and commercial dispute with an LVS customer, $0.08 per diluted share resulting from certain tax charges; and $0.03 per diluted share related to amendments to our credit agreement, all partially offset by $0.13 per diluted share relating to changes in certain employee benefit policies. Business highlights for the past year include:
The company reduced its calendar year 2008 forecast for light vehicle sales to 15.5 million vehicles in North America, down from 15.7 million vehicles forecasted in our last update in December. The company's forecast for Western Europe is 17.1 million vehicles, unchanged from the last update. ArvinMeritor's fiscal year 2008 forecast for North American Class 8 truck production is in the range of 210,000 to 230,000 units. The company's fiscal year 2008 forecast for heavy and medium truck volumes in Western Europe is 530,000 to 540,000, equal to the previous forecast. On a calendar year basis, the company anticipates North America Class 8 truck production to be in the range of 235,000 to 255,000 units; and heavy and medium truck volumes in Western Europe to be in the range of 540,000 to 550,000. The company anticipates sales from continuing operations in fiscal year 2008 in the range of $6.9 billion to $7.1 billion due to continued growth outside the U.S. and favorable foreign exchange movements. The outlook for full-year EBITDA from continuing operations, before special items, is expected to be in the range of $385 million to $405 million for the fiscal year. ArvinMeritor reaffirms its forecast for diluted earnings per share from continuing operations, before special items, to be in the range of $1.40 to $1.60. This guidance is based on the assumption of 2.2 percent U.S. GDP growth, and excludes gains or losses on divestitures and restructuring costs. ArvinMeritor is revising its forecast for free cash flow to be in the range of negative $75 million to negative $125 million due in large part to increased working capital requirements driven by higher sales volumes in Europe and Asia Pacific. "The improvement in our operating performance this quarter indicates that the actions we are implementing, driven primarily through our Performance Plus profit improvement program, are taking effect," adds McClure. "We are on track to achieve cost-savings of $75 million this year, and are pleased that ideas already implemented total $58 million in savings on an annual run rate basis." For more information about ArvinMeritor, visit the company's Web site. |
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