Auto parts maker Tenneco Automotive on Tuesday reported a wider fourth-quarter net loss citing charges for restructuring and refinancing as well as steel cost rises.
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According to Reuters, Tenneco said revenue from North American and European car and truck makers grew in the quarter while light vehicle production declined industry-wide.
Tenneco reportedly is working to offset the impact from higher steel costs, which are expected to continue to the end of 2005, by raising prices to customers and reducing production costs.
Reuters said the net loss increased to $21 million, or 49 cents a share, from $2 million, or 4 cents a share, a year earlier.
Excluding restructuring, debt refinancings and other factors, earnings rose to $8 million, or 17 cents a share, from $2 million, or 6 cents a share. Analysts, on average, expected earnings of 18 cents a share, according to Reuters Estimates.
The news agency noted that Tenneco previously announced the restructuring, which is expected to save about $20 million per year, while the debt refinancing is expected to save about $15 million per year.
Net sales reportedly rose to $1.07 billion from $933 million.
Ford and General Motors cut light vehicle production last quarter and into the first quarter, but the impact on parts makers varies depending on plans for each car and light truck model, Reuters noted.
The report said Tenneco benefited in North America from its position on better-selling vehicles and from heavy truck production, which was stronger than a year earlier while higher volume for emissions products supported European results. The company expects that position to help counter volatile 2005 industry production in North America and Europe, Reuters added.
According to the report, Tenneco said steel costs were $15 million higher in the fourth quarter than a year ago, and it expects the net cost to be $30 million to $50 million higher in 2005 than in 2004.
Tenneco expects its book of business with car and truck makers to rise by about $270 million to $3.5 billion in 2005 from 2004 and expects it to reach $3.6 billion in 2006, Reuters said.
