ArvinMeritor net income for its third fiscal quarter ended 30 June 2006 was $US20m or $0.29 per share, compared to $46 m, or $0.66 per diluted share, in the same period last year.
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Income from continuing operations was $25m or $0.36 per share, compared to $50m or $0.72 per share.
The parts maker said the fall was due primarily to a “labour disruption” at a brake facility in Canada which unfavourably impacted income from continuing operations by $28m after tax.
Q3 sales were a record $2.5bn, up 4% from Q3 2005. The main factors contributing to the increase were improved light vehicle systems (LVS) sales in Europe and Asia/Pacific, and strong growth in the company’s commercial specialty business, which makes components for vehicles including fire and rescue; construction and utility; military; school buses; motor homes and custom chassis.
Income from continuing operations, before special items, was $51m or $0.73 per share, exceeding the previous guidance of $0.60 to $0.70 per share.
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By GlobalDataOperating income was $47m, down 49%, compared to $93m a year ago, primarily due to the Tilbury labour disruption.
“Our results for the third quarter of fiscal 2006 build upon the continued execution of our strategic initiatives, including previously announced restructuring activities and our ongoing focus on operational performance,” said chairman, CEO and president Chip McClure in a statement.
“However, we cannot discount the significant impact of the labour disruption that occurred in June at our brake facility.
“We regret the disruption and inconvenience this temporary work stoppage had on the production schedules of certain customers, but we are pleased that this situation was quickly resolved. We are back on track and running at full capacity to provide the superior support and service our customers have come to expect from us. Excluding the impact of this disruption, we are proud of the performance we delivered in the quarter, exceeding the top end of our guidance range.”
The company recorded a loss from discontinued operations of $5m or $0.07 per share, compared to a loss of $4m or $0.06 per diluted share last year.
The company’s fiscal year 2006 outlook for light vehicle production in North America is 15.8m vehicles, up slightly from the previous forecast, and 16.4m vehicles in western Europe, unchanged. The outlook for North American Class 8 truck production is 340,000 units in fiscal year 2006, also unchanged from the previous forecast. In western Europe, the company is raising its outlook for heavy- and medium- duty trucks to 439,000, an increase of 14,000 units.
“We are forecasting full-year sales to be approximately $9bn,” McClure said.
The company is raising its full-year guidance and expects income from continuing operations, before special items, to be in the range of $1.65 to $1.75 per share, up from the previously forecast range of $1.60 to $1.70 per share.
McClure added, “We are starting to see the financial and operational benefits of restructuring the company, specifically within the LVS business group, and we have made significant progress toward our goal to divest our LVA businesses.”
