Citing slashed OEM production schedules as an explanatory factor, Dana has announced wider Q4 loss and a net loss for the year of $298 million, a sharp reversal on 2000’s net income of $334 million.
Dana reported a fourth quarter net loss of $298 million ($2.01 per share) after net non-recurring charges of $284 million. The loss for the quarter, excluding the non- recurring items, was $14 million, or 9 cents per share on a diluted basis. In the fourth quarter of 2000, the net loss was $84 million (53 cents per share) after net non-recurring charges, and income excluding non-recurring items was $2 million (1 cent per share).
The company reported a net loss for the year of $298 million, or $2.01 per share on a diluted basis, after net non- recurring charges of $303 million. Income excluding these non-recurring items was $5 million, or 4 cents per share. In 2000, reported net income was $334 million ($2.18 per share) after net non-recurring charges, and income excluding non-recurring items was $377 million ($2.46 per share).
Dana is currently implementing a major restructuring plan announced in October, which called for a further work-force reduction of more than 15% and the closure or consolidation of more than 30 Dana facilities. Declining production schedules over the past two years had already required a 12% workforce reduction that affected all levels of the organisation.
The plan’s additional and accelerated actions followed the sharp declines in light-vehicle production schedules in the third quarter. Record levels of incentives drove strong light-vehicle sales in the fourth quarter. Vehicle manufacturers met this demand from existing inventories and continued to cut production, which impacted Dana’s sales. Similarly, heavy-truck production, which had already experienced a historic drop, slowed another 13% from the third to fourth quarter.
“Given the most recent trends and the general economic outlook, we continue to be cautious about the prospects for recovery in our markets in the near term,” said Dana Chairman and CEO Joe Magliochetti in a company statement. “That’s why the rapid execution of our restructuring plan continues to be our primary focus. These actions will reduce our break-even point and enable us to improve our performance even if our markets remain weak.
“Since announcing our plan in October, we have made solid progress with our restructuring actions. We have already reduced the work force by 7 percent and announced the closure of 21 facilities. At the same time, we’re building a strong book of business for the future.”