ArvinMeritor, Inc. today reported financial results for its third quarter ended June 30, 2008, with net income of $44 million, or $0.60 per diluted share, compared to a net loss of $70 million, or $0.99 per diluted share, in the third quarter of fiscal year 2007.
Sales were $2 billion - approximately $340 million higher than the same period last year.
Income from continuing operations, before special items, was $56 million, or $0.77 per diluted share, compared to $18 million, or $0.25 per diluted share, one year ago.
Cash flow from operations, net of capital expenditures, was $59 million compared to an outflow of $156 million in the same period last year.
Commercial Vehicle Systems (CVS) EBITDA margins increased by 1.2 percentage points, before special items, in the third quarter of fiscal year 2008 compared to the same period last year.
Light Vehicle Systems (LVS) sales, largely driven by overseas markets, increased by $34 million, a 6-percent increase over the same period last year (down five-percent on a constant currency basis).
"ArvinMeritor's favorable product, customer and geographic mix, combined with a dedicated focus across the company to implement and maintain cost reduction initiatives, drove strong results this quarter." said Chairman, CEO and President Chip McClure. "I am pleased that the hard work and commitment of our global team is being reflected in our financial results."
On May 6, 2008, the company announced its intent to spin off its LVS business to ArvinMeritor shareholders, with the commercial vehicle business - consisting of truck, trailer, specialty products and the commercial vehicle aftermarket - remaining with ArvinMeritor. The new LVS business will be named Arvin Innovation. On May 28, Arvin Innovation filed the initial registration document (Form 10), and provided an update to the market via webcast. On July 28, the company filed its first amendment to the Form 10.
LVS achieved the third quarter milestones required in order to complete the spinoff, and is on track to achieve fourth quarter performance milestones. Information related to the spinoff is available on the company's website at arvinmeritor.com.
The company is currently launching Wave 2 of Performance Plus designed to drive idea generation and implementation with an emphasis on the company's business in Europe. ArvinMeritor's initial Performance Plus initiative, launched in December 2006, will fully achieve the company's 2008 target of $75 million in savings net of material cost increases. ArvinMeritor is in the process of re-energizing and refreshing the internal resources dedicated to the program.
ArvinMeritor recently announced another strategic move to expand its commercial vehicle aftermarket business with the acquisition of Trucktechnic, a remanufacturer and distributor of commercial vehicle disc and air system components based in Liege, Belgium.
Trucktechnic's line of brake kits, components, and testing equipment expands and complements ArvinMeritor's existing European aftermarket portfolio both in product breadth and market depth and will be key in supporting the company's continued growth in that region. This acquisition follows the company's purchase of Mascot Truck Parts in December 2007.
Since that time, the company announced a multi-million-dollar supply agreement to provide remanufactured transmissions and axle carriers to Navistar Parts, and has recently entered into agreements with PACCAR to support its Peterbilt and Kenworth dealer networks in Canada with the Mascot brand of remanufactured transmissions and axle carriers.
The company's calendar year 2008 forecast for light vehicle sales is in the range of 14.4 to 14.6 million vehicles in North America. ArvinMeritor's forecast for Western Europe is 16.6 to 16.9 million vehicles, down from 17.1 in the prior forecast.
On a calendar year basis, the company anticipates North America Class 8 truck production to be in the range of 195,000 to 205,000 units; and heavy and medium truck volumes in Western Europe to be in the range of 550,000 to 560,000.
ArvinMeritor's fiscal year 2008 forecast for North American Class 8 truck production is in the range of 185,000 to 195,000 units. The company's fiscal year 2008 forecast for heavy and medium truck volumes in Western Europe is 565,000 to 575,000.