Dana has posted preliminary 2016 sales down 4% to US$5.8bn and adjusted EBITDA of US$660m, with the former primarily due to foreign-currency translation reducing sales by around US$170m.

Sales from new business wins and strong North American markets partially offset weaker demand in global off-highway and Brazilian markets.

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Preliminary adjusted EBITDA for 2016 was around US$660m, or 11.3% of sales, a 50 basis-point improvement compared to 2015. Adjusted EBITDA benefited by US$15m from marketable securities gains and recoveries in a subsidiary of which US$8m was recognised in the fourth quarter. This subsidiary was divested at the end of the fourth quarter of 2016. 

Dana’s 2017-2019 sales backlog as of 31 December was US$750m, benefiting from increased new business, primarily in the Light Vehicle Driveline segment, overcoming the effects of foreign currency and lower commercial-vehicle and off-highway market demand.

End-market demand for light trucks is expected to improve slightly in 2017. In the medium/heavy-truck sector, lower North American Class 8 truck production will be mostly countered by higher demand in other regions. Off-highway market demand levels are anticipated to be relatively comparable or modestly higher compared with 2016.

Increased sales from new business backlog are expected to add around US$175m to sales. Currency is expected to be a headwind of about US$150m.

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Adjusted EBITDA margin in 2017 is expected to improve by around 10 basis points. This is driven by higher sales levels and improved cost performance, which offsets the impact of currency and the benefit from gains in 2016 of a divested subsidiary.

Capital spending is expected to remain at an elevated level due to continued investment supporting the new business backlog.

In the fourth quarter of 2016 the company announced a definitive agreement to purchase the power-transmission and fluid power businesses of Brevini Group. This transaction is expected to close in the first quarter of 2017, adding around US$350m to 2017 sales and US$35m to adjusted EBITDA. 

“This past year was a very positive evolution for Dana as we executed our plan and exceeded our commitments,” said president and CEO, James Kamsickas. “We successfully launched multiple customer programmes and, once again this year, improved our profitability through cost performance and new business growth.”

“We now look forward to 2017, as we expect to close and integrate the Brevini acquisition, which will add new growth opportunities in our Off-Highway business.

“We will also have another year of important new programme launches in our Light Vehicle driveline segment.”