Slide 1: Dana Corporation Second-Quarter Conference Call
Dana Corporation Second-Quarter Conference Call July 21, 2004 (c) Dana Corporation, 2004
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements herein about our forecasts, beliefs, and expectations constitute "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on our current information and assumptions. Forward-looking state
Slide 3: Key Topics
Key Topics Solid Second-Quarter Performance Aftermarket Sale & Potential Use of Anticipated Proceeds New Business Growth New Global Purchasing Initiative Financial Review 5
Slide 4: Financial Summary
Financial Summary Q2 - 2004 Q2 - 2003 Sales $2.3 billion $2.0 billion Net Income Earnings per Share $108 million $0.72 $52 million $0.35 Net Income, excluding unusual items $75 million $47 million Earnings Per Share, excluding unusual items $0.50 $0.31 7
Slide 5: 2nd Quarter Segment Comparison
2nd Quarter Segment Comparison Sales OPAT 2004 2004 2003 2003 Chg. Chg. (Millions) 9 Automotive 1,767 1,532 15 72 66 9 Heavy Vehicle 601 519 16 31 19 63 DCC 5 6 (16) Other (37) (39) 5 (51) (52) 2 Results from Cont. Operations 2,331 2,012 16 57 39 46 Discontinued Ops.* 18 8 Unusual Items 33 5 Consoli
Slide 6: 2004 Consecutive Quarter Segment Comparison
2004 Consecutive Quarter Segment Comparison Sales OPAT 2nd Qtr 2nd Qtr 1st Qtr 1st Qtr Chg. Chg. (Millions) 11 * 2004 Sales from Discontinued Operations were $557 in Q2 vs. $510 in Q1. Automotive 1,767 1,757 1 72 71 1 Heavy Vehicle 601 587 2 31 24 29 DCC 5 7 (29) Other (37) (33) (12) (51) (54) 6 Res
Slide 7: Aftermarket Business Divestiture
Aftermarket Business Divestiture Signed definitive agreement to sell aftermarket business to The Cypress Group for $1.1 billion in cash Transaction expected to close in third quarter Will provide strategic and financial flexibility Potential uses of proceeds: Contribute to pension plans Reduce lever
Slide 8: Where We've Been, Where We're Going
Dana Corporation Where We've Been Where We're Going Decentralized Company SBU Organization Disconnected Functions OE/Aftermarket Global Footprint w/NA Bias 2001 Restructuring Program Integrated Company Top-Line Growth & Continually Improving Cost Structure Market-Focused Organization Fully Leveraged
Slide 9: Net New Business
Net New Business ($ Millions) Estimates based on Dana's review of the projected production schedules of our customers 17 Automotive Systems Group Heavy Vehicle Technologies & Systems Group Net $420M vs. 2003 2004 2005 2006 Pluses Minuses $2,000 $1,600 $1,200 $800 - -$400 - -$800 $400 - -$1,200 Cumul
Slide 10: Exciting New Programs
Exciting New Programs 19 (c) Dana Corporation. Dated July 21, 2004. Slide may contain forward-looking information. Actual results may differ materially due to factors discussed on slide 2 F-150 Tacoma Navistar X3/X5 Model 357 Colorado Titan Gator Blue Diamond
Slide 11: NAFTA Heavy-Truck Overview
21 NAFTA Heavy-Truck Overview Backlog (000) Net Orders, Sales, Inventory & Build (000) Backlog Net Orders Build Sales Inventory 2001 69963 14785 13119 13888 47703 70726 12300 12184 13042 47415 67233 11085 13633 15836 44381 65214 10947 12199 15688 40345 60894 9656 13629 16679 38557 58728 10710 12863
Slide 12: N.A. Light-Vehicle Overview
N.A. Light-Vehicle Overview Production, U.S. Sales & U.S. Inventory (Units by Month) 2004 2002 Production/Sales 2003 Inventory 23 May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Se
Slide 13: Global Purchasing Initiative
Global Purchasing Initiative Goals: Transform decentralized structure Harmonize processes Drive "commonization" Achieve economies of scale Deliver savings Actions to Date: Appointed Paul Miller Global V.P. of Purchasing Established matrix organizational structure Two Supplier Week events - have met
Slide 14: Q2 Income Statement With DCC on an Equity Basis
2003 2002 27 Excluding Unusual Items Tax Adjustment * NOTE: Comparable GAAP measures available at www.dana.com Transaction Costs As Reported Q2 Income Statement With DCC on an Equity Basis* Unusual Items Aftermarket DCC
Slide 15: Income Statement With DCC on an Equity Basis
2003 2002 29 2004 2003 Second Quarter * NOTE: Comparable GAAP measures available at www.dana.com 2004 2003 Year-to-Date Income Statement With DCC on an Equity Basis*
Slide 16: Cash Flow Statement With DCC on an Equity Basis
Cash Flow Statement With DCC on an Equity Basis * (Millions) 31 2004 2003 Second Quarter 2004 2003 Year-to-Date * NOTE: Comparable GAAP measures available at www.dana.com
Slide 17: Capital Structure With DCC on an Equity Basis
33 Capital Structure With DCC on an Equity Basis* * NOTE: Comparable GAAP measures available at www.dana.com
Slide 18: June 30, 2004 Debt Portfolio
June 30, 2004 Debt Portfolio ($ Millions) 32 16 35 2004 2005 2006 2008 2009 2010 2011 2028 2029 A/R Sec'n 180 Revolver Sr Notes 150 350 250 819 165 268 Other 32.7 15.8 Maturities do not reflect swap valuation adjustments
Slide 19: June 30, 2004 Liquidity Excluding DCC
5-year bank facility $ 400 $ - $ 400 Accts receivable program* 300 180 120 Bridge facility* 100 - 100 Total short-term committed facilities $ 800 $ 180 $ 620 Plus: Cash 498 Total $1,118 Committed Drawn Available 37 (Millions) June 30, 2004 Liquidity Excluding DCC * Maximum size of Bridge facility is
Slide 20: DCC Portfolio Analysis
12/01 Total Portfolio Assets - $2,200 DCC Portfolio Analysis ($ Millions) VASG 85 50 45 RESG 170 705 195 CMG 610 Value-Added Services Retained Real Estate Capital Markets 6/04 Total Portfolio Assets - $1,210 VASG 120 10 50 RESG 170 900 0 CMG 410 39
Slide 21: 2004 Guidance
2004 Guidance ($ Millions, except per share data) Sales > $8,500 Net Income* > 285 EPS* > 1.90 41 * Excludes unusual items
Slide 22: 2004 Free Cash Flow Projection Excluding DCC
2004 Free Cash Flow Projection Excluding DCC * Excludes proceeds from aftermarket divestiture 43 (Millions)
Slide 23: Summary
Summary 45 Q2 performance: 16% Sales, 60% Profit* Pleased, but not satisfied We are taking action ... ASG Consolidation Better focus on markets we serve Improvement in Structures Purchasing Initiatives Help offset raw material costs Close AAG transaction Redeployment of proceeds Enhanced Customer Ap
Slide 24: Questions
47 Questions
Slide 25: Capital Structure Reconciliation as of December 31, 2003
49 Capital Structure Reconciliation as of December 31, 2003
Slide 26: Capital Structure Reconciliation as of June 30, 2004
51 Capital Structure Reconciliation as of June 30, 2004