2024 First-Quarter Earnings Conference Call
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Safe Harbor Statement
Certain statements and projections contained in this presentation 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 presentation speak only as of this date. Dana does not undertake any obligation to revise or update publicly any forward-looking statement for any reason.
© 2024 Dana
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Agenda
Craig Barber | James Kamsickas | Timothy Kraus |
Senior Director, Investor | Chairman and | Senior Vice President and |
Relations and Corporate | Chief Executive Officer | Chief Financial Officer |
Communications |
Introduction | Business Review | Financial Review |
Highlights
Q1 Financial Results
Key Highlights
sales
$91 million
from prior year
adjusted EBITDA
$19 million
from prior year
free cash flow
$118 million
from prior year
Company-Wide efficiency improvements
End market demand stable
Financial outlook remains strong; higher free cash flow
39%
- Conversion on traditional organic sales in Q1
- Supports full-year conversion target
~$100M
- Organic Sales growth in Q1
- Full-Yearmarket forecast unchanged
$75M
- Revised full-year FCF outlook
- 50% increase
© 2024 Dana
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Company-Wide Efficiency Improvements and Improving Customer Order Patterns Driving Profit and Cash Flow Growth
Business Environment
2024 Outlook
Company-wide
Efficiencies
Supply
Chain
New Programs &
Refreshed
Base Business
- Improved customer production stability increasing productivity
- Continued lowering production costs
- Efficiency improvements in all areas of the enterprise
- Net commodities expected to be sales and profit headwind
- Steel prices expected to be mostly flat in 2024
- Commodity recoveries reversing as input costs decline
- Refreshed, conquest, and new business growth
- Share gains partially offsetting market in Commercial Vehicle
- Normalized annual launch cadence driving higher efficiency
End-Market Outlook
Market | From last year |
Agriculture
Construction
Mining
Light Truck
Medium-Duty Truck
Heavy-Duty Truck
Update
Softening
No Change
No Change
No Change
Slight
Improvement
Slight
Improvement
Dana
Industry Trends | Cost Inflation Moderating | OEM Production Stable | EV Demand Fluctuating | ||
PACE Award: Electro-Mechanical, Infinitely Variable Transmission
Dana's Patented Electro-Mechanical, Infinitely Variable Transmission (EMIVT)
operates in engine-only, hybrid, or full-battery electric modes
Improved Sustainability | Enhanced Performance | Safer Working Environment | Reduce Total Cost | |||
and Functionality | of Ownership | |||||
- Up to 40% better fuel economy
- 28% faster acceleration
- Reduction of brake wear
- Zero-Emissionand low-noise
- Functional-Safetycompliance
- Pump and roll operation
- Regenerative braking
© 2024 Dana
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Industry and Customer Recognition
© 2024 Dana
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Recognition Demonstrates Dana's Ethical Foundation, Customer Focus, and Technological Expertise
Financial Review
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2024 Q1 Financial Results
- Higher sales driven by renewed vehicle programs, new business, and market share gains in commercial vehicle market
- Increased production efficiency, company-wide cost improvement actions, and more stable customer order patterns drove higher profitability
- Announced divestiture of European hydraulics business within the Off-Highway segment resulted in a $29M impairment charge and $7M of additional income tax expense due to valuation allowance adjustments, negatively impacting EPS by $0.25/share; transaction is expected close in Q2
- Improved cash flow driven by higher profit and lower working capital requirements
Changes from Prior Year
($ in millions, except EPS) | Q1 '24 | Q1 '23 | Change | |||
Sales | $ | 2,735 | $ | 2,644 | $ | 91 |
Adjusted EBITDA | 223 | 204 | 19 | |||
Margin | 8.2% | 7.7% | 50 bps | |||
Loss on Business Held for Sale | (29) | 0 | (29) | |||
EBIT | 70 | 90 | (20) | |||
Interest Expense, Net | 35 | 30 | 5 | |||
Income Tax Expense | 37 | 30 | 7 | |||
Net Income (attributable to Dana) | 3 | 28 | (25) | |||
GAAP Diluted EPS | $ | 0.02 | $ | 0.19 | $ | (0.17) |
Operating Cash Flow | (102) | (170) | 68 | |||
© 2024 Dana
See appendix for comments regarding the presentation of non-GAAP measures
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Higher Sales, Profit and Operating Cash Flow Driven by Strong Execution
2024 Q1 Sales and Profit Changes
- Higher organic sales driven by renewed vehicle programs, new business, and market share gains in commercial vehicle market partially offset by lower sales in off-highway agriculture markets
- Higher demand for battery cooling products driving increased EV sales
- Company-Widecost management and production efficiency more than offset inflation
- Positive contribution of current EV programs offset by engineering and development spending for future programs
- Minimal impact from currency translation
- Lower commodity costs resulting in lower sales recoveries; profit benefit of lower input costs offset by the cost true-ups with customers
Sales | |||||
$2,644M | $75M | $23M | $3M | ($10)M | $2,735M |
2023 | Traditional | EV Organic | Currency | Commodities | 2024 |
Organic |
Adjusted EBITDA
$204M | $29M | $223M | ||||
($ | ($1)M | |||||
4)M | ($ | 5)M | ||||
7.7% | ~90 bps | ~(20) bps | ~0 bps | ~(20) bps | 8.2% |
Margin | Margin | ||||
2023 Traditional EV Organic Currency Commodities 2024 Organic
See appendix for comments regarding the presentation of non-GAAP measures
© 2024 Dana
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Strong Performance Driven by Company-Wide Efficiencies
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DANA Incorporated published this content on 30 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 April 2024 12:22:07 UTC.