Dana Incorporated · NYSE:DAN
Dana — Q1 2008 Earnings Presentation
33 slides from Dana's earnings presentation, May 14, 2008
Slide 1: First-Quarter 2008 Conference Call
May 14, 2008 Dana Holding Corporation First-Quarter 2008 Conference Call
Slide 2: To Print This Presentation
To Print This Presentation ... Please visit: www.dana.com/investors
Slide 3: Safe Harbor Statement
Safe Harbor Statement Certain statements and projections contained in this presentation 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
Slide 4: Agenda
Agenda Introduction Steve Superits Vice President Investment Management & Investor Relations Opening Remarks John Devine Executive Chairman Financial Review Ken Hiltz Chief Financial Officer Operations Excellence Gary Convis Chief Executive Officer Closing Remarks John Devine Q&A Session All
Slide 5: First-Quarter Highlights
First-Quarter Highlights Emerged from Chapter 11 Reorganization on Jan. 31 More profitable Clean balance sheet and good liquidity position Conservatively capitalized, enhanced flexibility Complex financial statements because of Chapter 11 emergence Rebuilding Management Team Executive Chairman Chief
Slide 6: Market Outlook Mixed
Market Outlook Mixed Dana Outlook First-Quarter '08 Full-Year '08 Revenue $2.3B $9.0B+ Net New Business Market Outlook First-Quarter '08 (vs. '07) Full-Year '08 (vs. '07) Dana Industry Dana Industry Automotive: North America Rest of World Commercial Vehicle: North America Rest of World Off-Highway:
Slide 7: Steel Impact
Steel Impact Steel prices at unprecedented levels Average scrap and hot-rolled steel prices up roughly 30% during Q1 2008 vs. Q1 2007 Prices of both indices continue to climb Dana purchases approximately 1.5 million tons of steel and products with significant steel content annually Agreements with c
Slide 8: Diversification: An Important Strength for Dana
Diversification: An Important Strength for Dana Strength for Dana Strength for Dana 67% of '07 Sales to Customers Other than Detroit 3 38% of '07 Sales to Non-Automotive Markets
Slide 9: Product Mix Also Diversified
Product Mix Also Diversified
Slide 10: Income Statement First Quarter Combined 2008
Income Statement First Quarter Combined 2008 Reorganization Adjustments Fresh Start Adjustments Adjusted 2008 Sales $2,312 $ -- $ -- $2,312 Cost of sales (2,179) 19 (2,160) SG&A (99) (99) Amortization of intangibles (12) 12 -- Other income, net 40 40 Income from continuing operations before realignm
Slide 11: Income Statement First Quarter (vs. '07 & '06)
Income Statement First Quarter (vs. '07 & '06) Adjusted 2008 2007 2006 Sales $2,312 $2,145 $2,197 Cost of sales (2,160) (2,043) (2,092) SG&A (99) (96) (119) Other income, net 40 46 31 Income from continuing operations before realignment, interest, impairment, reorganization items, and income taxes 9
Slide 12: Segment Sales & Profit
Segment Sales & Profit First Quarter 2008 2007 2008 2007 Light Axle $ 641 $ 610 $ 28 $ 12 Driveshaft 335 286 38 18 Structures 270 270 22 23 Sealing 195 176 22 18 Thermal 80 72 7 7 Commercial Vehicle 306 340 15 17 Off Highway 479 384 47 41 Other 6 7 (10) (8) Segment operations $2,312 $2,145 169 128 S
Slide 13: Cash Flow First Quarter Combined 2008
Cash Flow First Quarter Combined 2008 Reorganization Adjustments Fresh Start Adjustments Adjusted 2008 Net income (loss) $ 685 $ (754) $ 24 $ (45) Depreciation and amortization 105 (31) 74 Deferred income taxes 189 (178) 7 18 Fresh start adjustments (1,009) 1,009 -- Gain on settlement of liabilities
Slide 14: Cash Flow First Quarter (vs. 2007)
Cash Flow First Quarter (vs. 2007) Adjusted 2008 2007 Net loss $ (45) $ (92) Depreciation and amortization 74 70 Deferred income taxes 18 Gain on settlement of liabilities and reorganization costs 30 27 Working capital (185) (52) Other operating, net 8 30 Cash used for operations (100) (17) Divestit
Slide 15: Cash Flow: Impact of Reorganization & Related Items
Cash Flow First Quarter 2008 2007 Cash used for operations $(1,049) $(17) Reorganization and related items: VEBA payments 788 Payment of claims 88 Reorganization expenses 73 10 $ (100) $ (7) Impact of Reorganization & Related Items ($ in millions)
Slide 16: Global Liquidity
Global Liquidity ($ in millions) Cash $1,283 Less: Deposits supporting obligations (118) Cash in less than wholly-owned subsidiaries (85) Available cash 1,080 Additional cash availability from: Lines of credit (U.S. and Europe) 515 Additional lines of credit supported by letters of credit from the R
Slide 17: Reorganized Balance Sheet
Reorganized Balance Sheet Assets - Cash and other current assets $3,740 $948 $137 $4,825 Property, plant, and equipment 1,763 278 2,041 Intangibles 1 679 680 Goodwill 352 (50) 302 Other non-current assets 466 22 (61) 427 Total assets $6,322 $970 $983 $8,275 Liabilities and Equity - Current liabiliti
Slide 18: Balance Sheet
Balance Sheet Assets ^ Cash and other current assets $4,231 Property, plant, and equipment 2,049 Intangibles 678 Goodwill 310 Other non-current assets 435 Total assets $7,703 Liabilities and Equity ^ Current liabilities other than debt $2,179 Short-term debt 127 Long-term debt 1,321 Non-current liab
Slide 19: Fresh Start Accounting
Fresh Start Accounting Inventory valuation accounting Amortization of intangibles Depreciation NOLs Goodwill accounting
Slide 20: Operations Excellence
Operations Excellence "Jump-starting" our operations is a top priority - "Operations Excellence" Starting with manufacturing - our core and largest business activity Realigned and added resources to support new initiatives Rolling out three key initiatives: Shared metrics Dana Operating System Footp
Slide 21: Operations Excellence: Shared Metrics
Operations Excellence Develop shared, standardized, targeted metrics across the enterprise Key Performance Indicators (KPIs) Cost-reduction focus Standard review cadence Pilot underway at 14 plants Targeting global roll-out in June
Slide 22: Operations Excellence: Dana Operating System
Operations Excellence Develop and deploy Dana Operating System Using many tools and concepts derived from experience at Toyota Train people on various tools, processes, and rules to enable continuous improvement Learn by doing Value and encourage perseverance Phase I roll-out focused in North Americ
Slide 23: Operations Excellence: Manufacturing Footprint Optimization
Operations Excellence Manufacturing Footprint Optimization Operating improvements will be paralleled by regular reviews of global manufacturing footprint Ensure we are producing the right products in the right places to best serve customers
Slide 24: Operational Excellence Group
Operational Excellence Group Support organization formed to expedite progress in three operations initiatives Led by Gilberto Ceratti, president of Structural Products and Driveshaft Products groups Highly capable in-house staff and talented new additions Team will engage plant leadership and union
Slide 25: Extending Principles to the Entire Enterprise
Extending Principles to the Entire Enterprise All of Dana must improve operational effectiveness Dana Operating System disciplines and tools will be used across our organization to improve efficiency in support organizations: Supply Chain Management, Human Resources, Information Technology, Finance
Slide 26: Key Priorities: 2008
Key Priorities: 2008 Priorities Recent Actions Goals for Balance of Year Continue to strengthen organization Rebuild the Team Jump-Start Operations Address Strategic Issues Financial Performance & Plans Roll-out across organization Continue to attack cost structure Prioritize investments by business
Slide 27: Q&A Session
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Slide 28: Supplemental Slides
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Slide 29: Non-GAAP Financial Information
29 (c) Dana Limited Non-GAAP Financial Information In connection with Dana's emergence from bankruptcy on January 31, 2008 and the application of fresh start accounting in accordance with the provisions of the American Institute of Certified Public Accountants' Statement of Position 90-7, the post-e
Slide 30: Consolidated Statement of Operations
DANA HOLDING CORPORATION Consolidated Statement of Operations For the Quarters ended March 31, 2008 and 2007 ‘Unavdtea) ‘Seing, gener andadrnaiabe expenses ‘rtaton ct tangs Feat cage et Inet espns crac rst $17 fer "hore morn ended Saray 31, 2008 538 fern oe monn ee Mare 3, 2007) rah ta acouring agit
Slide 31: Consolidated Statement of Cash Flows
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Slide 32: Segment EBITDA Reconciliation
32 DANAHOLDING CORPORATION SEGMENT EBITDA RECONCILIATION Reconciliation of Segment EBITDA to Income (Loss) from Continuing Operations Before Income Taxes ‘Three Months Ended March 31, 2008 Dana Prior Dana [Combined Prior Dana TwoMonths One Month Three Months Three Months Ended Ended Ended Ended Marc
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