Tenneco has reported second-quarter net income down 45% to US$26m, with revenue of US$4.5bn, which includes US$1.9bn from acquisitions.
Second-quarter 2019 adjusted net income was US$97m compared to US$96m, while adjusted EBITDA was US$414m versus US$233m last year.
“Tenneco’s revenue growth outpaced industry production by nine percentage points, driven by higher light vehicle, commercial truck and off-highway revenues,” said Tenneco co-CEO, Brian Kesseler.
“We delivered sequential earnings improvement on flat revenue quarter to quarter, with disciplined cost management and effective synergy capture actions.”
Third quarter 2019:
Tenneco expects third quarter revenue in the range of US$4.3bn to US$4.4bn. The supplier expects its third quarter adjusted EBITDA to be in the range of US$390m to US$410m, including year-over-year pro forma margin improvement of around 100 basis points in both the DRiV and New Tenneco divisions.
Full Year 2019:
The company updated its 2019 full year outlook and now expects:
- Total revenues in the range of US$17.6bn to US$17.8bn
- Value-add revenues in the range of $14.6bn to $14.8bn
- Value-add adjusted EBITDA margin of 10.4% to 10.6%
- Adjusted EBITDA of US$1.5bn to $1.57bn
- Interest expense of US$335m
- Cash taxes in the range of US$180m to US$200m
- Capital expenditures of US$730m
- Net debt/LTM adjusted EBITDA of 3.3x
“In the third quarter, we expect our revenues to outgrow the markets we serve,” said Tenneco co-CEO, Roger Wood.
“More importantly, we anticipate higher margins on a year-over-year basis in both divisions supported by operational performance improvements, synergy realisation and our continued focus on eliminating waste and cost throughout the business.”