Go Search
            Home   Contact Us
Our Company
Products and Services
Advanced Solutions
Work With Us
Investors
Suppliers
 
 
 
 
Investors
 
 
News Release
Printer Friendly Version View printer-friendly version
·Back
ArvinMeritor Reports Fourth-Quarter and Fiscal Year 2005 Results

Achieves Full-Year Income from Continuing Operations, Before Special Items, at Upper End of Guidance Range

TROY, Mich., Nov. 15 /PRNewswire-FirstCall/ -- ArvinMeritor, Inc. (NYSE: ARM) today reported financial results for its full fiscal year and fourth quarter ended Sept. 30, 2005.

    (Logo:  http://www.newscom.com/cgi-bin/prnh/20010524/ARVINLOGO )

    * In line with guidance previously provided, full-year income from
      continuing operations, before special items, was $110 million, or $1.57
      per diluted share.
    * On a GAAP basis, income from continuing operations was $33 million, or
      $0.47 per diluted share, which includes $72 million of after-tax
      restructuring charges the company incurred to reshape the business.
    * Sales from continuing operations for fiscal year 2005 were $8.9 billion,
      up $870 million, or 11 percent, compared to the same period last year.
    * Fourth-quarter income from continuing operations before special items
      was $29 million, or $0.41 per diluted share. On a GAAP basis, income
      from continuing operations was $12 million, or $0.17 per diluted share.
    * Fourth-quarter sales were $2.1 billion, up 6 percent from the same
      period last year.

"ArvinMeritor delivered a strong performance in the fourth quarter and throughout our 2005 fiscal year, despite the tough challenges confronting the entire automotive industry," said Chairman, CEO and President Chip McClure. "Our experienced management team and dedicated employees delivered excellent performance, enabling ArvinMeritor to achieve full-year income from continuing operations, before special items, at the high end of our guidance range."

Fourth-Quarter Results 2005

For the fourth quarter of fiscal year 2005, ArvinMeritor posted sales of $2.1 billion, a 6-percent increase over the same period last year. The increase in sales was driven by continued strength in commercial vehicle markets and an increase in sales from the company's new Commercial Vehicle Systems (CVS) axle joint ventures with the Volvo group in Europe. Currency translation also increased sales by approximately $40 million.

Operating income, before special items, was $60 million in the fourth quarter of fiscal 2005. Restructuring costs in the fourth quarter of fiscal 2005 were $36 million, of which $33 million related to actions announced in May. Steel costs, net of recovery, were approximately $15 million higher in the fourth quarter than in the same period last year. Operating income was $58 million in the fourth quarter of fiscal year 2004.

Income from continuing operations, excluding special items, was $29 million, or $0.41 per diluted share. Special items included $20 million of after-tax restructuring costs associated with actions announced in May and $3 million of after-tax costs associated with the debt exchange completed in September. In addition, income from continuing operations excludes $6 million of one-time favorable tax benefits.

Jim Donlon, ArvinMeritor's CFO, said, "We are pleased with the results of our CVS business, which saw sales of $997 million in the fourth quarter of fiscal year 2005. Excluding $5 million of new restructuring costs and higher net steel costs of $11 million, CVS operating margins would have been 6.3 percent, compared to the reported 5.3 percent in the fourth quarter of fiscal year 2004." Donlon added, "Light Vehicle Systems (LVS) is leading the way with our restructuring efforts and have made excellent progress in reshaping the business. Restructuring costs are on target and actions are proceeding as planned."

With regard to the Light Vehicle Aftermarket (LVA) business, "Due to evolving industry dynamics, we now believe selling the businesses individually, rather than as a whole, appears to be the right course of action to maximize our shareowners' value," McClure said. "This change in strategy has not materially impacted our view of the total expected proceeds. It does, however, for accounting purposes, require us to evaluate fair value on an individual business basis rather than LVA as a whole." This resulted in an after-tax non-cash impairment charge of $28 million, or $0.40 per diluted share in certain LVA businesses. Loss from discontinued operations, including the impairment charge, was $31 million, or $0.44 per diluted share, compared to a loss of $183 million, or $2.67 per diluted share, last year.

Outlook for 2006

The company's fiscal year 2006 forecast for light vehicle production is 15.6 million vehicles in North America and 16.4 million vehicles in Western Europe.

ArvinMeritor's forecast for North American Class 8 truck production is 305,000 units in fiscal year 2006. The forecast for heavy and medium truck volumes in Western Europe is 421,000 units.

For the first quarter of fiscal year 2006, the sales forecast for continuing operations is $2.1 billion. The company's outlook for diluted earnings per share from continuing operations is $0.13 to $0.17, before special items.

ArvinMeritor's sales outlook for continuing operations in 2006 is expected to be approximately $8.6 billion, and the outlook for full-year diluted earnings per share from continuing operations is in the range of $1.50 to $1.70. This guidance excludes gains or losses on divestitures, restructuring costs, and other special items, including extended customer shutdowns or production interruptions.

"We are encouraged by the ongoing strong demand and volume in our commercial vehicle business -- and the growth opportunities we see for both CVS and LVS in diesel emissions technology," said McClure. "We are actively pursuing these and many other growth opportunities both in U.S. and international markets, while aggressively implementing actions to improve the profitability of our business."

About ArvinMeritor

ArvinMeritor, Inc. is a premier global supplier of a broad range of integrated systems, modules and components to the motor vehicle industry. The company serves light vehicle, commercial truck, trailer and specialty original equipment manufacturers and certain aftermarkets. Headquartered in Troy, Mich., ArvinMeritor employs approximately 29,000 people at more than 120 manufacturing facilities in 25 countries. ArvinMeritor common stock is traded on the New York Stock Exchange under the ticker symbol ARM. For more information, visit the company's Web site at: http://www.arvinmeritor.com/.

Forward-Looking Statements

All earnings per share amounts are on a diluted basis. The company's fiscal year ends on the Sunday nearest Sept. 30, and its fiscal quarters end on the Sundays nearest Dec. 31, March 31 and June 30. All year and quarter references relate to the company's fiscal year and fiscal quarters, unless otherwise stated.

This press release contains statements relating to future results of the company (including certain projections and business trends) that are "forward- looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by words or phrases such as "believe," "expect," "anticipate," "estimate," "should," "are likely to be," "will," and similar expressions. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including, but not limited to, global economic and market conditions; the demand for commercial, specialty and light vehicles for which the company supplies products; risks inherent in operating abroad (including foreign currency exchange rates and potential disruption of production and supply due to terrorist attacks or acts of aggression); availability and cost of raw materials, including steel; OEM program delays; demand for and market acceptance of new and existing products; successful development of new products; reliance on major OEM customers; labor relations of the company, its customers and suppliers; including potential disruptions in supply of parts to our facilities or demand for our products due to work stoppages; the financial condition of the company's suppliers and customers, including potential bankruptcies; successful integration of acquired or merged businesses; the ability to achieve the expected annual savings and synergies from past and future business combinations; success and timing of potential divestitures; potential impairment of long-lived assets, including goodwill; competitive product and pricing pressures; the amount of the company's debt; the ability of the company to access capital markets; credit ratings of the company's debt; the outcome of existing and any future legal proceedings, including any litigation with respect to environmental or asbestos-related matters; as well as other risks and uncertainties, including, but not limited to, those detailed from time to time in the filings of the company with the Securities and Exchange Commission.

Non-GAAP Measures

In addition to the results reported in accordance with accounting principles generally accepted in the United States of America (GAAP), the company has provided information regarding income from continuing operations, diluted earnings per share, and segment operating income and margins before special items which are non-GAAP financial measures. These non-GAAP measures are defined as reported income or loss from continuing operations, reported diluted earnings or loss per share and segment operating income plus or minus special items.

Management believes these non-GAAP financial measures are useful to both management and investors in the analysis of the company's results of operations and financial position. These non-GAAP measures should not be considered a substitute for the reported results of operations prepared in accordance with GAAP. These non-GAAP financial measures may not be comparable to related or other similarly titled measures reported by other companies.

Included is a reconciliation of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP.

Fourth-Quarter and Fiscal Year 2005 Results Conference Call

The company will host a telephone conference call and Web cast to discuss the company's fiscal year 2005 fourth-quarter and full year financial results on Tuesday, Nov. 15, 2005, at 9 a.m. (ET). To participate, call (706) 643- 7449 approximately 10 minutes prior to the start of the call. Please reference ArvinMeritor when dialing in to participate. Investors can also listen to the conference call in real time -- or by recording for 90 days - by visiting http://www.arvinmeritor.com.

A replay of the call will be available from 11 a.m. Nov. 15, until midnight, Nov. 17, 2005, by calling (800) 642-1687 (within the United States and Canada) or (706) 645-9291 (international calls). Please refer to conference ID number 1436150.

To access the listen-only audio Web cast, visit the ArvinMeritor Web site at http://www.arvinmeritor.com/ and click on the Web cast link on either the home page or investor page.


                               ARVINMERITOR, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                (Unaudited, in millions, except per share amount)


                                           Quarter Ended  Twelve Months Ended
                                             September 30,    September 30,
                                            2005      2004     2005     2004
                                              (Unaudited)

     Sales                                 $2,126   $2,014   $8,903   $8,033
     Cost of Sales                         (1,974)  (1,853)  (8,267)  (7,366)
     GROSS MARGIN                             152      161      636      667
       Selling, General, & Administrative     (88)     (96)    (376)    (385)
       Restructuring Costs                    (36)      (4)    (117)     (15)
       Gain on Divestitures, Net                -        -        4       20
       Environmental Remediation Costs         (1)      (3)      (7)     (11)
       Customer Bankruptcies                    -        -      (10)       -
       Costs for Withdrawn Tender Offer         -        -        -      (16)
     OPERATING INCOME                          27       58      130      260
       Equity in Earnings of Affiliates         8        7       28       19
       Gain on Sale of Marketable Securities    -        -        -        7
       Interest Expense, Net and Other        (38)     (30)    (127)    (107)
     INCOME (LOSS) BEFORE TAXES                (3)      35       31      179
       Benefit (Provision) for Income Taxes    14       (5)       5      (44)
       Minority Interests                       1        -       (3)      (8)
     Income From Continuing Operations         12       30       33      127
     Loss from Discontinued Operations        (31)    (183)     (21)    (169)

     NET INCOME (LOSS)                       $(19)   $(153)     $12     $(42)

     DILUTED EARNINGS (LOSS) PER SHARE
       Continuing Operations                $0.17    $0.44    $0.47    $1.85
       Discontinued Operations              (0.44)   (2.67)   (0.30)   (2.46)
     Diluted Earnings (Loss) Per Share     $(0.27)  $(2.23)   $0.17   $(0.61)

     Diluted Shares Outstanding              70.1     68.7     69.9     68.6



                               ARVINMERITOR, INC.
                    CONSOLIDATED BUSINESS SEGMENT INFORMATION
                                  (In millions)


                                         Quarter Ended     Twelve Months Ended
                                           September 30,     September 30,
                                           2005     2004     2005     2004
                                            (Unaudited)
    Sales:
      Light Vehicle Systems                $1,129   $1,115   $4,849   $4,818
      Commercial Vehicle Systems              997      899    4,054    3,215
    Total Sales                            $2,126   $2,014   $8,903   $8,033

    Operating Income (Loss):
      Light Vehicle Systems                  $(18)     $13     $(53)    $123
      Commercial Vehicle Systems               47       48      193      164
    Segment Operating Income                   29       61      140      287
      Unallocated Corporate Costs              (2)      (3)     (10)     (27)
    Total Operating Income                    $27      $58     $130     $260



                               ARVINMERITOR, INC.
                       SUMMARY CONSOLIDATED BALANCE SHEET
                                  (In millions)

                                                  September 30,  September 30,
                                                      2005              2004

     ASSETS
     Cash and Cash Equivalents                        $187              $132
     Receivables, Net                                1,655             1,478
     Inventories                                       541               523
     Other Current Assets                              256               238
     Assets of Discontinued Operations                 531               615
     Net Property                                    1,013             1,032
     Goodwill                                          801               808
     Other Assets                                      886               813
     TOTAL ASSETS                                   $5,870            $5,639

     LIABILITIES AND SHAREOWNERS' EQUITY
     Short-Term Debt                                  $131                $3
     Accounts Payable                                1,483             1,366
     Other Current Liabilities                         667               622
     Liabilities of Discontinued Operations            242               282
     Other Liabilities                                 963               830
     Long-Term Debt                                  1,451             1,487
     Minority Interests                                 58                61
     Shareowners' Equity                               875               988
     TOTAL LIABILITIES AND SHAREOWNERS' EQUITY      $5,870            $5,639




                               ARVINMERITOR, INC.
             SUMMARY CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (In millions)

                                                       Twelve Months Ended
                                                          September 30,
                                                      2005              2004
    OPERATING ACTIVITIES
    Income from Continuing Operations                  $33              $127
      Adjustments to Income From Continuing Operations
        Depreciation and Amortization                  182               183
        Gains on Divestitures and
         Marketable Securities, Net                     (4)              (27)
        Restructuring Costs, Net of Expenditures        75                (3)
        Pension and Retiree Medical Expense            110               130
        Pension and Retiree Medical Contributions     (164)             (212)
    Proceeds from Termination of Interest Rate Swaps    22                 -
    Changes in Receivable Securitization and Factoring (19)             (187)
    Changes in Assets and Liabilities                 (136)              164
    Cash Flows Provided By Continuing Operations        99               175
    Cash Flows Provided By (Used For)
     Discontinued Operations                          (131)               44
    CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES   (32)              219

    INVESTING ACTIVITIES
      Capital Expenditures                            (146)             (152)
      Acquisitions of Businesses and
       Investments, Net of Cash Acquired               (31)               (3)
      Proceeds from Disposition of
       Property and Businesses                          49                85
      Proceeds from Sale of Marketable Securities        -                18
      Net Cash Flows Provided By (Used For)
       Discontinued Operations                         153               (68)
    CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES    25              (120)

    FINANCING ACTIVITIES
        Net Decrease in Revolving Credit Facilities      -               (53)
        Borrowings on Accounts Receivable
         Securitization Program                        112                 -
        Purchase of Notes                              (21)                -
        Payments on Lines of Credit and Other           (5)               (2)
      Net Change in Debt                                86               (55)
      Payment of Issuance Costs Associated with
       Debt Exchange                                   (10)                -
      Proceeds from Exercise of Stock Options            6                 6
      Cash Dividends                                   (28)              (28)
    CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES    54               (77)

    EFFECT OF CHANGES IN FOREIGN CURRENCY EXCHANGE
     RATES ON CASH                                       8                 7

    CHANGE IN CASH AND CASH EQUIVALENTS                 55                29
    CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR     132               103
    CASH AND CASH EQUIVALENTS AT END OF YEAR          $187              $132


                                ARVINMERITOR, INC.
                 SELECTED FINANCIAL INFORMATION - RECONCILIATION
                                     Non-GAAP
                             (Unaudited, in millions)


   (in millions, except per share amounts)

                                     Q4 FY 05    New Restructuring    Debt
                                     Reported       Actions         Exchange

    Sales                            $2,126              $-              $-
    Gross Margin                        152               -               -
    Operating Income                     27              33               -
    Income from Continuing Operations    12              20               3
    Diluted Earnings (Loss)
     Per Share - Continuing
     Operations                       $0.17           $0.28           $0.04

    Segment Operating Income

      LVS Operating Income (Loss)     $ (18)            $28             $ -
      CVS Operating Income               47               5               -

    Segment Operating Income             29              33               -
       Unallocated corporate costs       (2)              -               -
    Total Operating Income              $27             $33             $ -

    Operating Margins
      LVS                              -1.6%
      CVS                               4.7%
    Segment Operating Margins           1.4%
    Total Operating Margins             1.3%




                                     Income Taxes          Q4 FY05 Adjusted
    Sales                                 $-                    $2,126
    Gross Margin                           -                       152
    Operating Income                       -                        60
    Income from Continuing Operations     (6)                       29
    Diluted Earnings (Loss)
     Per Share - Continuing
     Operations                       $(0.08)                    $0.41

    Segment Operating Income

      LVS Operating Income (Loss)         $-                       $10
      CVS Operating Income                 -                        52
    Segment Operating Income               -                        62
       Unallocated corporate costs         -                        (2)
    Total Operating Income                $-                       $60

    Operating Margins
      LVS                                                          0.9%
      CVS                                                          5.2%
    Segment Operating Margins                                      2.9%
    Total Operating Margins                                        2.8%



                                ARVINMERITOR, INC.
                 SELECTED FINANCIAL INFORMATION - RECONCILIATION
                                     Non-GAAP
                             (Unaudited, in millions)

        (in millions, except per share amounts)
                                             New
                            FY 05         Restructuring             Customer
                          Reported         Actions   Environmental Bankruptcy
    Sales                   $8,903        $    -       $    -         $    -
    Gross Margin               636             -            -              4
    Operating Income           130           101            6              9
    Income from Continuing
     Operations                 33            62            4              6
    Diluted Earnings Per
     Share - Continuing
     Operations             $ 0.47        $ 0.89       $ 0.06         $ 0.09

    Guidance

    Segment Operating Income
    LVS Operating Income
     (Loss)                   $(53)       $   82       $    -         $  9
    CVS Operating Income       193            19            -            -
    Segment Operating Income   140           101            -            9
    Unallocated corporate
     costs                     (10)            -            6            -
    Total Operating Income    $130        $  101       $    6         $  9

    Operating Margins
    LVS                      -1.1%
    CVS                       4.8%
    Segment Operating Margins 1.6%
    Total Operating Margins   1.5%


                              ARVINMERITOR, INC.
               SELECTED FINANCIAL INFORMATION - RECONCILIATION
                                   NON-GAAP

                           (Unaudited, in millions)

                                                   Income
                                   Debt Exchange   Taxes     FY05 Adjusted
    (in millions, except
      per share amounts)
    Sales                            $  -         $   -          $  8,903
    Gross Margin                        -             -               640
    Operating Income                    -             -               246
    Income from Continuing Operations   3             2               110
    Diluted Earnings Per Share -
     Continuing Operations          $0.04         $0.02          $   1.57

    Guidance                                                $1.40 - $1.60

    Segment Operating Income        $   -             -          $     38
      LVS Operating Income (Loss)       -             -               212
      CVS Operating Income              -             -               250
    Segment Operating Income
      Unallocated corporate costs       -             -                (4)
    Total Operating Income          $   -         $   -          $    246

    Operating Margins
      LVS                                                             0.8%
      CVS                                                             5.2%
    Segment Operating Margins                                         2.8%
    Total Operating Margins                                           2.8%

SOURCE ArvinMeritor, Inc.

CONTACT:
Media:
Lin Cummins
248-435-7112
linda.cummins@arvinmeritor.com

Investors:
Brian Casey
248-435-0015
brian.casey@arvinmeritor.com
both of ArvinMeritor, Inc.

 
 
 
 
2014 Meritor, Inc. All Rights Reserved.

Minimize Restore Close Delete Modify Shared Web Part Connections Export...