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  • Dana Incorporated Announces Revenue and Profit Growth in Third Quarter, Affirms Full-year Guidance Ranges
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Dana Incorporated Announces Revenue and Profit Growth in Third Quarter, Affirms Full-year Guidance Ranges

Oct. 29, 2018

MAUMEE, Ohio, Oct. 29, 2018 /PRNewswire/ --



Dana Incorporated logo. (PRNewsFoto/Dana Incorporated)



Highlights


  • Sales of $1.98 billion, an 8 percent increase of $147 million
  • Net income attributable to Dana of $95 million; diluted EPS of $0.65
  • Adjusted EBITDA of $240 million, providing a margin of 12.1 percent
    • Profit increase of $24 million over third quarter last year
    • Margin increase of 30 basis points over third quarter last year
  • Diluted adjusted EPS of $0.77, an improvement of 31 percent over third quarter last year 
  • Operating cash flow of $124 million; free cash flow of $34 million
  • Announced strategic acquisition of Oerlikon Drive Systems, enhancing electrification capabilities and off-highway portfolio
  • Significant new business wins and key production launches
  • Nominated eighth consecutive year for Automotive News PACE Award

Dana Incorporated (NYSE: DAN) today announced strong financial results for the third quarter of 2018.


"In the third quarter, Dana continued its strong revenue growth, a result of improved end-market demand, market share gains, and the launch of our strong sales backlog, including our class-leading Spicer SmartConnect™ all-wheel drive system featuring Spicer® AdvanTEK® axle technology, which was recently named a finalist for the prestigious PACE Award," said James Kamsickas, Dana president and chief executive officer.  "Our team also continues to execute on strategic inorganic priorities, highlighted by the recent announcement of a definitive agreement to acquire the Drive Systems segment of the Oerlikon Group.  Combined with the recent acquisition of TM4, Dana is the only mobility supplier with full e-Propulsion system capability."  


Third-quarter 2018 Financial Results


Sales for the third quarter of 2018 totaled $1.98 billion, compared with $1.83 billion in the same period of 2017, representing an 8 percent increase.  Adjusted for currency translations, due primarily to weaker Latin American currencies compared with the U.S. dollar, sales increased 10 percent over the same period last year.  This double-digit growth on a constant currency basis was mainly the result of continued high demand across all three end markets and conversion of sales backlog.


Dana reported net income of $95 million for the third quarter of 2018, compared with net income of $69 million in the same period of 2017, primarily due to increased operating earnings associated with higher sales.


Diluted earnings per share were $0.65, compared with earnings per share of $0.46 in 2017.


Adjusted EBITDA for the third quarter of 2018 was $240 million, an increase of $24 million, or 11 percent, over the same period last year.  This was driven principally by higher end-market demand, conversion of the sales backlog, and acquisition synergies while being partially offset by the effects of currency translation and higher commodity costs.  Adjusted EBITDA margin was 12.1 percent in this year's third quarter, a 30 basis-point improvement over last year.  Stronger sales and operational performance more than offset the margin headwind attributable to the effects of higher raw material prices and the associated material recovery reflected in sales.


Diluted adjusted earnings per share were $0.77 in the third quarter of 2018, compared with $0.59 in the same period last year, reflecting the higher year-over-year operational earnings improvement.  


Operating cash flow in the third quarter of 2018 was $124 million, compared with $181 million in the same period of 2017.  Higher working-capital requirements to meet increased demand and elevated cash taxes due to regional profit mix more than offset the benefit of stronger earnings.  In combination with slightly higher capital spend, free cash flow was $34 million in the third quarter of this year, compared with $99 million in 2017.  


Company Affirms 2018 Guidance Ranges
Sales for this year are expected to be at the high end of the company's guidance range, resulting in 12 percent growth over last year.  The year-over-year improvement is due principally to continued strong end-market demand and conversion of its new-business backlog.  With the increased level of commodity cost inflation, associated recoveries are expected to comprise approximately $65 million of the year-over-year sales comparison.


Adjusted EBITDA in 2018 is now expected to improve by approximately $130 million from 2017 for a margin improvement of 40 basis points.  This improvement is driven primarily by higher sales levels, ongoing efficiency benefits, and acquisition synergies.  The expected full-year margin reduction attributable to inflationary material recoveries of $65 million in sales and higher raw material costs of $105 million approximates 70 basis points.  


Free cash flow is expected to be approximately 3 percent of sales due to slightly lower adjusted EBITDA and a higher level of working capital required by accelerating customer demand and the timing of new business ramp-up.


"As we finish strong this year, we are positioning our operations for continued profitable growth," said Jonathan Collins, executive vice president and chief financial officer of Dana.  "Through the third quarter, we have achieved 15 percent year-over-year sales and profit growth, despite rising material costs.  Over the last three years, we have improved margins an average of 40 basis points per year, and we remain confident in our business performance and our ability to continue to improve margin."


2018 Full-year Financial Targets


  • Sales of $7,750 to $8,050 million;
  • Adjusted EBITDA of $950 to $1,010 million, an implied adjusted EBITDA margin of approximately 12.0 percent;
  • Diluted adjusted EPS1 of $2.75 to $3.05;
  • Operating cash flow of approximately 7.0 percent of sales;
  • Capital spending of approximately 4.0 percent of sales; and
  • Free cash flow of approximately 3.0 percent of sales.

1 Net income and diluted EPS guidance are not provided, as discussed below in Non-GAAP Financial Information.


Dana to Host Conference Call at 9 a.m. Today
Dana will discuss its third-quarter results in a conference call at 9 a.m. EDT today.  Participants may listen to the audio portion of the conference call either through audio streaming online or by telephone.  Slide viewing is available online via a link provided on the Dana investor website: www.dana.com/investors.  U.S. and Canadian locations should dial 1-888-311-4590 and international locations should call 1-706-758-0054.  Please enter conference I.D. 4569318 and ask for the "Dana Incorporated's Financial Webcast and Conference Call."  Phone registration will be available starting at 8:30 a.m. EDT. 


An audio recording of the webcast will be available after 5 p.m. EDT on Oct. 29 by dialing 1-855-859-2056 (U.S. or Canada) or 1-404-537-3406 (international) and entering conference I.D. 4569318.  A webcast replay will also be available after 5 p.m. EDT and may be accessed via Dana's investor website.


Non-GAAP Financial Information


This release refers to adjusted EBITDA, a non-GAAP financial measure which we have defined as net income before interest, taxes, depreciation, amortization, equity grant expense, restructuring expense, non-service cost components of pension and other postretirement benefit costs and other adjustments not related to our core operations (gain/loss on debt extinguishment, pension settlements, divestitures, impairment, etc.). Adjusted EBITDA is a measure of our ability to maintain and continue to invest in our operations and provide shareholder returns. We use adjusted EBITDA in assessing the effectiveness of our business strategies, evaluating and pricing potential acquisitions and as a factor in making incentive compensation decisions. In addition to its use by management, we also believe adjusted EBITDA is a measure widely used by securities analysts, investors, and others to evaluate financial performance of our company relative to other Tier 1 automotive suppliers. Adjusted EBITDA should not be considered a substitute for income before income taxes, net income or other results reported in accordance with GAAP. Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.


Diluted adjusted EPS is a non-GAAP financial measure, which we have defined as adjusted net income divided by adjusted diluted shares.  We define adjusted net income as net income (loss) attributable to the parent company, excluding any nonrecurring income tax items, restructuring charges, amortization expense, and other adjustments not related to our core operations (as used in adjusted EBITDA), net of any associated income tax effects.  We define adjusted diluted shares as diluted shares as determined in accordance with GAAP based on adjusted net income.  This measure is considered useful for purposes of providing investors, analysts, and other interested parties with an indicator of ongoing financial performance that provides enhanced comparability to EPS reported by other companies.  Diluted adjusted EPS is neither intended to represent nor be an alternative measure to diluted EPS reported under GAAP.


Free cash flow is a non-GAAP financial measure, which we have defined as cash provided by (used in) operating activities, less purchases of property, plant, and equipment.  We believe this measure is useful to investors in evaluating the operational cash flow of the company inclusive of the spending required to maintain the operations.  Free cash flow is neither intended to represent nor be an alternative to the measure of net cash provided by (used in) operating activities reported under GAAP.  Free cash flow may not be comparable to similarly titled measures reported by other companies.


The accompanying financial information provides reconciliations of adjusted EBITDA, diluted adjusted EPS and free cash flow to the most directly comparable financial measures calculated and presented in accordance with GAAP.  We have not provided a reconciliation of our adjusted EBITDA and diluted adjusted EPS outlook to the most comparable GAAP measures of net income and diluted EPS.  Providing net income and diluted EPS guidance is potentially misleading and not practical given the difficulty of projecting event-driven transactional and other non-core operating items that are included in net income and diluted EPS, including restructuring actions, asset impairments and income tax valuation adjustments.  The accompanying reconciliations of these non-GAAP measures with the most comparable GAAP measures for the historical periods presented are indicative of the reconciliations that will be prepared upon completion of the periods covered by the non-GAAP guidance.


Please reference the "Non-GAAP financial information" accompanying our quarterly earnings conference call presentations on our website at www.dana.com/investors for our GAAP results and the reconciliations of these measures, where used, to the comparable GAAP measures.


Forward-Looking Statements


Certain statements and projections contained in this news release are, by their nature, forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements are based on our current expectations, estimates and projections about our industry and business, management's beliefs, and certain assumptions made by us, all of which are subject to change.  Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words.  These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement. 


Dana's Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other Securities and Exchange Commission filings discuss important risk factors that could affect our business, results of operations and financial condition.  The forward-looking statements in this news release speak only as of this date. Dana does not undertake any obligation to revise or update publicly any forward-looking statement for any reason.


About Dana Incorporated


Dana is a world leader in highly engineered solutions for improving the efficiency, performance, and sustainability of powered vehicles and machinery.  Dana supports the passenger vehicle, commercial truck, and off-highway markets, as well as industrial and stationary equipment applications.  Founded in 1904, Dana employs more than 30,000 people in 33 countries on six continents who are committed to delivering long-term value to customers.  Based in Maumee, Ohio, USA, the company reported sales of $7.2 billion in 2017. Dana is ranked among the Drucker Institute's listing of the 250 most effectively managed companies.   For more information, please visit dana.com.


 


 DANA INCORPORATED 








 Consolidated Statement of Operations (Unaudited) 








 For the Three Months Ended September 30, 2018 and 2017 



















Three Months Ended


 (In millions, except per share amounts) 




September 30,






2018



2017


 Net sales 





$      1,978



$      1,831


 Costs and expenses 







     Cost of sales 




1,692



1,562


     Selling, general and administrative expenses 




119



124


     Amortization of intangibles 




2



4


     Restructuring charges, net 




9



2


 Other expense, net 




(9)




 Earnings before interest and income taxes 




147



139


 Loss on extinguishment of debt 






(13)


 Interest income 




3



3


 Interest expense 




24



25


 Earnings before income taxes 




126



104


 Income tax expense 




31



33


 Equity in earnings of affiliates 




1



2


 Net income 




96



73


     Less: Noncontrolling interests net income 




1



3


     Less: Redeemable noncontrolling interests net income 





1


 Net income attributable to the parent company 




$            95



$            69









 Net income per share available to common stockholders 






    Basic 





$        0.66



$        0.47


    Diluted 





$        0.65



$        0.46









 Weighted-average shares outstanding - Basic 




144.7



145.0


 Weighted-average shares outstanding - Diluted 




145.9



146.9









 Cash dividends declared per share 




$        0.10



$        0.06


 


 DANA INCORPORATED 








 Consolidated Statement of Operations (Unaudited) 








 For the Nine Months Ended September 30, 2018 and 2017 



















Nine Months Ended


 (In millions, except per share amounts) 




September 30,






2018



2017


 Net sales 





$      6,170



$      5,372


 Costs and expenses 







     Cost of sales 




5,269



4,562


     Selling, general and administrative expenses 




383



377


     Amortization of intangibles 




6



9


     Restructuring charges, net 




17



14


 Impairment of indefinite-lived intangible asset 




(20)




 Adjustment in fair value of disposal group held for sale 



3




 Other expense, net 




(19)



(12)


 Earnings before interest and income taxes 




459



398


 Loss on extinguishment of debt 






(19)


 Interest income 




8



8


 Interest expense 




71



79


 Earnings before income taxes 




396



308


 Income tax expense 




75



94


 Equity in earnings of affiliates 




13



12


 Net income 




334



226


     Less: Noncontrolling interests net income 




6



13


     Less: Redeemable noncontrolling interests net income (loss) 



1



(2)


 Net income attributable to the parent company 




$         327



$         215









 Net income per share available to common stockholders 






    Basic 





$        2.25



$        1.46


    Diluted 





$        2.23



$        1.45









 Weighted-average shares outstanding - Basic 




145.1



144.8


 Weighted-average shares outstanding - Diluted 




146.6



146.5









 Cash dividends declared per share 




$        0.30



$        0.18


 


 DANA INCORPORATED 







 Consolidated Statement of Comprehensive Income (Unaudited) 







 For the Three Months Ended September 30, 2018 and 2017 




















Three  Months Ended


 (In millions) 



September 30,







2018



2017


 Net income 



$            96



$            73


 Other comprehensive income (loss), net of tax: 







Currency translation adjustments



(19)



(1)



Hedging gains and losses



3



(14)



Defined benefit plans



21



19



Other comprehensive income



5



4


Total comprehensive income



101



77



Less: Comprehensive income attributable to noncontrolling interests





(5)



Less: Comprehensive income attributable to redeemable noncontrolling interests





(1)


Comprehensive income attributable to the parent company



$         101



$            71


 


 


 DANA INCORPORATED 







 Consolidated Statement of Comprehensive Income (Unaudited) 







 For the Nine Months Ended September 30, 2018 and 2017 




















Nine  Months Ended


 (In millions) 



September 30,







2018



2017


 Net income 



$         334



$         226


 Other comprehensive income (loss), net of tax: 







Currency translation adjustments



(65)



(2)



Hedging gains and losses



(11)



(13)



Defined benefit plans



34



29



Other comprehensive income (loss)



(42)



14


Total comprehensive income



292



240



Less: Comprehensive income attributable to noncontrolling interests





(18)



Less: Comprehensive income attributable to redeemable noncontrolling interests






Comprehensive income attributable to the parent company



$         292



$         222


 


 


 


 DANA INCORPORATED 





 Consolidated Balance Sheet (Unaudited) 





 As of September 30, 2018 and December 31, 2017 









 (In millions, except share and per share amounts) 


September 30,



December 31,



2018



2017


 Assets 






 Current assets 





 Cash and cash equivalents 


$                322



$                603


 Marketable securities 


36



40


 Accounts receivable 





      Trade, less allowance for doubtful accounts of $8 in 2018 and 2017 


1,228



994


      Other 


173



172


 Inventories 


1,100



969


 Other current assets 


103



97


 Current assets of disposal group held for sale 




7


           Total current assets 


2,962



2,882


 Goodwill 


249



127


 Intangibles 


173



174


 Deferred tax assets 


443



420


 Other noncurrent assets 


76



71


 Investments in affiliates 


216



163


 Property, plant and equipment, net 


1,828



1,807


           Total assets 


$             5,947



$             5,644








 Liabilities and equity 





 Current liabilities 





 Short-term debt and current portion of long-term debt 


$                   36



$                   40


 Accounts payable 


1,246



1,165


 Accrued payroll and employee benefits 


196



219


 Taxes on income 


67



53


 Other accrued liabilities 


254



220


 Current liabilities of disposal group held for sale 




5


           Total current liabilities 


1,799



1,702


 Long-term debt, less debt issuance costs of $19 in 2018 and $22 in 2017 


1,760



1,759


 Pension and postretirement obligations 


553



607


 Other noncurrent liabilities 


368



413


 Noncurrent liabilities of disposal group held for sale 




2


           Total liabilities 


4,480



4,483


 Commitments and contingencies 







 Redeemable noncontrolling interests 




103



47


 Parent company stockholders' equity 





      Preferred stock, 50,000,000 shares authorized, $0.01 par value, 





           no shares outstanding 


-



-


      Common stock, 450,000,000 shares authorized, $0.01 par value, 





           144,662,794 and 144,984,050 shares outstanding 


2



2


      Additional paid-in capital 


2,364



2,354


      Retained earnings 


371



86


      Treasury stock, at cost (8,341,922 and 7,001,017 shares) 


(119)



(87)


      Accumulated other comprehensive loss 


(1,379)



(1,342)


           Total parent company stockholders' equity 


1,239



1,013


 Noncontrolling interests 


125



101


           Total equity 


1,364



1,114


           Total liabilities and equity 


$             5,947



$             5,644


 


 DANA INCORPORATED 






 Consolidated Statement of Cash Flows (Unaudited) 






 For the Three Months Ended September 30, 2018 and 2017 














Three Months Ended


 (In millions) 



September 30,





2018



2017


 Operating activities 






 Net income 



$            96



$            73


 Depreciation 



63



58


 Amortization of intangibles 



3



4


 Amortization of deferred financing charges 



1



1


 Call premium on debt 





10


 Write-off of deferred financing costs 





3


 Earnings of affiliates, net of dividends received 





4


 Stock compensation expense 



4



7


 Deferred income taxes 



(2)



5


 Pension contributions, net 



1



(1)


 Change in working capital 



(37)



24


 Other, net 



(5)



(7)


 Net cash provided by operating activities (1) 



124



181








 Investing activities 






 Purchases of property, plant and equipment (1) 



(90)



(82)


 Proceeds from sale of subsidiary, net of cash disposed 



(6)




 Purchases of marketable securities 



(7)



(6)


 Proceeds from maturities of marketable securities 



7



3


 Other, net 



(2)




 Net cash used in investing activities 



(98)



(85)








 Financing activities 






 Net change in short-term debt 



(8)



(17)


 Proceeds from long-term debt 





276


 Repayment of long-term debt 



(6)



(352)


 Call premium on debt 





(10)


 Deferred financing payments 





(3)


 Dividends paid to common stockholders 



(14)



(9)


 Distributions to noncontrolling interests 



(3)



(4)


 Contributions from noncontrolling interests 



22




 Payments to acquire redeemable noncontrolling interests 



(43)




 Other, net 





3


 Net cash used in financing activities 



(52)



(116)








 Net decrease in cash, cash equivalents and restricted cash 



(26)



(20)


 Cash, cash equivalents and restricted cash − beginning of period (2) 



343



577


 Effect of exchange rate changes on cash balances 





11


 Less: Cash contributed to disposal group held for sale 



10




 Cash, cash equivalents and restricted cash − end of period (2) 



$         327



$         568








(1)


Free cash flow of $34 in 2018 and $99 in 2017 is the sum of net cash provided by 





operating activities reduced by the purchases of property, plant and equipment.










(2)


Includes restricted cash of $5 at September 30, 2018, $4 at June 30, 2018,





$10 at September 30, 2017 and $9 at June 30, 2017.






 


 


 


 DANA INCORPORATED 






 Consolidated Statement of Cash Flows (Unaudited) 






 For the Nine Months Ended September 30, 2018 and 2017 














Nine Months Ended


 (In millions) 



September 30,





2018



2017


 Operating activities 






 Net income 



$         334



$         226


 Depreciation 



187



162


 Amortization of intangibles 



8



10


 Amortization of deferred financing charges 



3



4


 Call premium on debt 





15


 Write-off of deferred financing costs 





4


 Earnings of affiliates, net of dividends received 



5



2


 Stock compensation expense 



13



17


 Deferred income taxes 



(47)



10


 Pension contributions, net 



2



(4)


 Impairment of indefinite-lived intangible asset 



20




 Gain on sale of subsidiary 





(3)


 Adjustment in fair value of disposal group held for sale 



(2)




 Change in working capital 



(269)



(80)


 Other, net 



(17)



(2)


 Net cash provided by operating activities (1) 



237



361








 Investing activities 






 Purchases of property, plant and equipment (1) 



(235)



(251)


 Acquisition of businesses, net of cash acquired 



(151)



(182)


 Proceeds from previous acquisition 



9




 Proceeds from sale of subsidiary, net of cash disposed 



(6)



3


 Purchases of marketable securities 



(36)



(23)


 Proceeds from sales of marketable securities 



6



1


 Proceeds from maturities of marketable securities 



30



16


 Other, net 



(2)



(1)


 Net cash used in investing activities 



(385)



(437)








 Financing activities 






 Net change in short-term debt 



(13)



(96)


 Proceeds from long-term debt 





676


 Repayment of long-term debt 



(8)



(640)


 Call premium on debt 





(15)


 Deferred financing payments 





(9)


 Dividends paid to common stockholders 



(43)



(26)


 Distributions to noncontrolling interests 



(7)



(7)


 Repurchases of common stock 



(25)




 Contributions from noncontrolling interests 



22




 Payments to acquire redeemable noncontrolling interests 



(43)




 Other, net 



(5)



4


 Net cash used in financing activities 



(122)



(113)








 Net decrease in cash, cash equivalents and restricted cash 



(270)



(189)


 Cash, cash equivalents and restricted cash − beginning of period (2) 



610



716


 Effect of exchange rate changes on cash balances 



(13)



41


 Cash, cash equivalents and restricted cash − end of period (2) 



$         327



$         568








(1)


Free cash flow of $2 in 2018 and $110 in 2017 is the sum of net cash provided by 





operating activities reduced by the purchases of property, plant and equipment.










(2)


Includes restricted cash of $5 at September 30, 2018, $7 at December 31, 2017,





$10 at September 30, 2017 and $9 at December 31, 2016.






 


 


 DANA INCORPORATED 







 Segment Sales and Segment EBITDA (Unaudited) 




 For the Three Months Ended September 30, 2018 and 2017 
















Three Months Ended


 (In millions) 




September 30,





2018



2017


Sales 







  Light Vehicle




$           879



$           805


  Commercial Vehicle




406



371


  Off-Highway




425



384


  Power Technologies




268



271


Total Sales 




$        1,978



$        1,831








Segment EBITDA 







  Light Vehicle




$           102



$             91


  Commercial Vehicle




39



33


  Off-Highway




69



55


  Power Technologies




33



41


Total Segment EBITDA 




243



220


Corporate expense and other items, net 




(3)



(4)


Adjusted EBITDA 




$           240



$           216


 


 


 DANA INCORPORATED 







 Segment Sales and Segment EBITDA (Unaudited) 




 For the Nine Months Ended September 30, 2018 and 2017 
















Nine Months Ended


 (In millions) 




September 30,





2018



2017


Sales 







  Light Vehicle




$        2,702



$        2,369


  Commercial Vehicle




1,217



1,057


  Off-Highway




1,402



1,107


  Power Technologies




849



839


Total Sales 




$        6,170



$        5,372








Segment EBITDA 







  Light Vehicle




$           297



$           273


  Commercial Vehicle




114



91


  Off-Highway




220



157


  Power Technologies




117



132


Total Segment EBITDA 




748



653


Corporate expense and other items, net 




(14)



(15)


Adjusted EBITDA 




$           734



$           638


 


 


 


 DANA INCORPORATED 






 Reconciliation of Segment and Adjusted EBITDA to Net Income (Unaudited) 


 For the Three Months Ended September 30, 2018 and 2017 













Three Months Ended


 (In millions) 



September 30,




2018



2017


Segment EBITDA 



$           243



$           220


  Corporate expense and other items, net



(3)



(4)


Adjusted EBITDA 



240



216


  Depreciation



(63)



(58)


  Amortization of intangibles



(3)



(4)


  Non-service cost components of pension and OPEB costs



(3)




  Restructuring



(9)



(2)


  Stock compensation expense



(4)



(7)


  Strategic transaction expenses



(6)



(3)


  Amounts attributable to previously divested/closed operations





(1)


  Other items



(5)



(2)


Earnings before interest and income taxes 



147



139


  Loss on extinguishment of debt





(13)


  Interest expense



(24)



(25)


  Interest income



3



3


Earnings before income taxes 



126



104


Income tax expense 



31



33


Equity in earnings of affiliates 



1



2


Net income 



$             96



$             73


 


 


 DANA INCORPORATED 






 Reconciliation of Segment and Adjusted EBITDA to Net Income (Unaudited) 


 For the Nine Months Ended September 30, 2018 and 2017 













Nine Month Ended


 (In millions) 



September 30,




2018



2017


Segment EBITDA 



$           748



$           653


  Corporate expense and other items, net



(14)



(15)


Adjusted EBITDA 



734



638


 Depreciation



(187)



(162)


 Amortization of intangibles



(8)



(10)


 Non-service cost components of pension and OPEB costs



(10)




 Restructuring



(17)



(14)


 Stock compensation expense



(13)



(17)


 Strategic transaction expenses, net of transaction breakup fee income



(13)



(20)


 Acquisition related inventory adjustments





(14)


 Impairment of indefinite-lived intangible asset



(20)




 Adjustment in fair value of disposal group held for sale



3




 Amounts attributable to previously divested/closed operations





2


 Other items



(10)



(5)


Earnings before interest and income taxes 



459



398


 Loss on extinguishment of debt





(19)


 Interest expense



(71)



(79)


 Interest income



8



8


Earnings before income taxes 



396



308


Income tax expense 



75



94


Equity in earnings of affiliates 



13



12


Net income 



$           334



$           226


 


 


 DANA INCORPORATED 







 Diluted Adjusted EPS (Unaudited) 






 For the Three Months Ended September 30, 2018 and 2017 












 (In millions, except per share amounts) 









Three Months Ended





September 30,





2018



2017


 Net income attributable to parent company 



$             95



$             69


 Items impacting income before income taxes: 






      Restructuring charges 



9



2


      Amortization of intangibles 



3



4


      Strategic transaction expenses 



6



3


      Loss on extinguishment of debt 





13


      Other items 



5



3


 Items impacting income taxes: 






      Net income tax expense on items above 



(5)



(8)


 Adjusted net income 



$           113



$             86








 Diluted shares - as reported 



145.9



146.9


 Adjusted diluted shares 



145.9



146.9








 Diluted adjusted EPS 



$          0.77



$          0.59


 


 


 


 DANA INCORPORATED 






 Diluted Adjusted EPS (Unaudited) 






 For the Nine Months Ended September 30, 2018 and 2017 












 (In millions, except per share amounts) 









Nine Months Ended





September 30,





2018



2017


 Net income attributable to parent company 



$           327



$           215


 Items impacting income before income taxes: 







 Restructuring charges 



17



14



 Amortization of intangibles 



8



10



 Strategic transaction expenses 



13



20



 Impairment of indefinite-lived intangible asset 



20





 Loss on extinguishment of debt 





19



 Acquisition related inventory adjustments 





14



 Other items 



3



3


 Items impacting income taxes: 







 Net income tax expense on items above 



(15)



(17)



 Tax benefit attributable to utilization of federal tax credits, state tax 







     law changes and associated valuation allowance release 



(46)





 Tax expense attributable to international legal entity reorganization 







     and retroactive application of new tax authority adminstrative policy 



5




 Adjusted net income 



$           332



$           278








 Diluted shares - as reported 



146.6



146.5


 Adjusted diluted shares 



146.6



146.5








 Diluted adjusted EPS 



$          2.26



$          1.90


 


 




SOURCE Dana Incorporated


Media Contact: Jeff Cole, +1-419-887-3535, jeff.cole@dana.com; Investor Contact: Craig Barber, +1-419-887-5166, craig.barber@dana.com
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