Tenneco Automotive has reported first quarter 2006 net income of $US7m, or 14 cents per share, compared with $7m, or 16 cents a share in first quarter 2005.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
Adjusted net income was $9m, or 20-cents per share and this quarter’s net income includes an expense of $1million for adopting the new accounting standard for expensing stock-based compensation.
EBIT (earnings before interest, taxes and minority interest) was $42m compared with $44m in first quarter 2005. On an adjusted basis, EBIT was $49m, up from $47m a year ago.
Currency had a $2m negative impact on EBIT in the quarter, compared with first quarter 2005. EBITDA (EBIT before depreciation and amortisation) was $86m, compared with $90m the previous year.
Adjusted EBITDA was $93m, even with first quarter 2005. Currency had a $3m negative impact on EBITDA in the quarter, compared with first quarter 2005.
The company’s gross margin was 18.6%. The decrease from 19.3% in first quarter 2005 was driven by an increase in substrate sales, which, on average, carry lower margins; timing on recovering costs on some steel increases; $7 million in gross material cost increases; $3 million in restructuring costs; and $1 million in higher fuel surcharges, all of which offset improved manufacturing performance.
First quarter revenue was $1.13bn, up 3% year-over-year. Excluding the negative impact of currency and substrate sales, quarterly revenue increased 2%.
Tenneco made earnings gains in Europe; boosted North American aftermarket performance on higher ride control volumes; and increased OE revenues in China due to the ramp-up of new platform launches.
But the company’s North American OE revenues and earnings were negatively impacted by the wind-down of several emission control vehicle platforms. Also, an increase in substrate sales in the company’s European OE emission control business had an impact on Europe’s year-over-year earnings improvement. An ongoing effort to improve manufacturing efficiency and reduce costs partially offset the impact from these.
“Our earnings results reflect current North American market conditions including the earlier than anticipated wind down on a large platform. Additionally, unfavourable currency had a negative impact on our EBIT results and year-over-year comparison. However, our geographical balance helped offset North American OE market pressure as we continued to see improvement in our European operations, North American aftermarket and in China,” said Tenneco chairman Mark Frissora.
“We are also pleased with the momentum we maintained on key strategies – improving cash performance, reducing debt and controlling costs – as we prepare for significant new business launches scheduled for later this year.”
