Meritor announced second fiscal quarter (to 31 March 2016) sales of US$821m, down 5% year on year. Operating income was $33m versus $39m and adjusted EBITDA was $81m, compared to $87m. Adjusted EBITDA margin was 9.9% versus 10.1%.
The supplier said the sales fall was due to lower truck production volumes in North and South America and the effect of foreign exchange translation, particularly in Brazil.
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The decline in adjusted EBITDA and adjusted EBITDA margin was driven by lower production in North and South America and a non-recurring foreign currency hedge gain in the second quarter of 2015, which was partially offset by lower material, labour and burden costs.
Commercial truck and industrial sales for the second quarter of fiscal year 2016 were $631m, down $50m.
Segment EBITDA for the commercial truck and industrial segment was $56m for the quarter, down $1m. But segment EBITDA margin increased to 8.9%, from 8.4%.
Outlook
The company revised guidance for fiscal year 2016: Revenue to be approximately $3.275bn, as compared to the prior outlook of approximately $3.4bn.
Adjusted EBITDA margin to be approximately 10%, unchanged from prior expectations.
"We are continuing to execute well despite volatility in certain end markets," said CEO and president Jay Craig. "M2016 is a transformational strategy for the company. We remain on track to achieve the underlying financial goals for new business, net debt reduction and improved margin performance as we stay committed to M2016 and providing a greater return to our shareholders."
