“In 2019, for the third consecutive year, Dana delivered year-over-year growth in revenue, adjusted EBITDA, and adjusted free cash flow,” says James Kamsickas, Dana chairman and CEO. “Over the past year, the Dana team achieved more than $1 billion of adjusted EBITDA for the first time in the history of the company, while successfully integrating the Graziano and Fairfield business, Dana’s largest acquisition in over two decades.”
Dana says sales for the fourth quarter of 2019 totaled $1.99 billion, compared with $1.97 billion in the same period of 2018, representing a $14 million improvement. The increase was attributable to the benefit of recent acquisitions and backlog conversion, partially offset by lower end-market demand for heavy vehicles and unfavorable currency translation and lower commodity recoveries.
Dana also reported net income of $85 million for the fourth quarter of 2019, compared with net income of $100 million in the same period of 2018. The difference was primarily due to higher interest expense and one-time costs related to refinancing of senior notes and acquisitions. Adjusted EBITDA for the fourth quarter of 2019 was $226 million, compared with $223 million for the same period last year. Dana says profit in the fourth quarter of 2019 benefited from backlog conversion and inorganic growth, partially offset by an unfavorable mix, driven by lower end-market demand for heavy vehicles.
Looking at the entire year, sales for 2019 were $8.6 billion, compared with $8.1 billion, an increase of 6 percent, primarily due to conversion of sales backlog and acquisitions partially offset by lower end-market demand for heavy vehicles, as well as currency headwinds. Net income in 2019 was $226 million, compared with net income of $427 million in 2018. Adjusted EBITDA for 2019 was $1.02 billion, or 11.8 percent of sales. Margin was comparable to the prior year despite unfavorable mix due to lower end-market demand for heavy vehicles, the company says.
The company also reported operating cash flow of $637 million in 2019, an improvement of$69 million compared with 2018. Adjusted free cash flow was $272 million, or 3.2 percent of sales, compared with $243 million, or 3 percent of sales in 2018. The improvement was driven by higher earnings, lower cash taxes, and lower working capital requirements, partially offset by higher capital expenditures to support new programs, higher interest expense, and one-time costs related to acquisitions, Dana says.
“Despite expected softer demand in our heavy-vehicle markets, we continue to successfully manage through this cycle and execute our strategic plan,” says Jonathan Collins, Dana executive vice president and CFO. “We have positioned the company for significant adjusted free cash flow growth this year, and our strong sales backlog and multi-market focus will buffer end-market demand.”
