) adjusted income dropped to $33 million or 34 cents per share in
the third quarter of fiscal 2013 from $37 million or 38 cents a
share in the year-ago quarter. However, earnings per share
surpassed the Zacks Consensus Estimate of 20 cents.
On a reported basis, the company posted a net profit of $37
million or 38 cents per share in the third quarter of fiscal 2013
compared with $50 million or 51 cents in the corresponding
quarter last year.
Revenues went down 10.8% year on year to $993 million and also
missed the Zacks Consensus Estimate of $1.03 billion. The decline
in revenues was due to lower sales in military business in North
America and China.
Adjusted EBITDA declined to $87 million compared with $92 million
in the third quarter of fiscal 2012. Meanwhile, adjusted EBITDA
margin was 8.8% compared with 8.3% in the year-ago quarter.
EBITDA margin was higher than the prior-quarter level by 240
basis points. The improvement in EBITDA margin was driven by
better net material performance and higher volumes.
Revenues from the
Commercial Truck & Industrial segment
fell 13.1% to $784 million in the reported quarter as all
regions, but South Africa, registered lower sales. Segment EBITDA
decreased 5.6% to $67 million from $71 million in the year-ago
quarter. EBITDA margin was 8.5% compared with 7.9% in the
prior-year quarter, due to lower material costs, variable labor
and structural cost reductions, partially offset by lower
Revenues from the
Aftermarket & Trailer segment
decreased 2.9% to $238 million, due to lower volumes in North
America. Segment EBITDA increased 13.6% to $25 million from $22
million a year ago. EBITDA margin improved to 10.5% from 9% in
the third quarter of fiscal 2012, driven by better pricing
actions and lower material and structural costs.
Meritor's cash and cash equivalents decreased to $228 million as
of Jun 30, 2013 from $257 million as of Sep 30, 2012. Total debt
increased to $1.17 billion as of Jun 30, 2013 from $1.06 billion
as of Sep 30, 2012.
In the first nine months of fiscal 2013, the company had cash
outflow of $73 million from operating activities compared with
cash inflow of $22 million in the year-ago period. Capital
expenditures declined to $31 million from $65 million a year ago.
The company had free cash outflow from continuing operations of
$104 million in the period compared with $43 million in the first
nine months of fiscal 2012.
For fiscal 2013, the company expects revenues in the range of
$3.725 billion to $3.775 billion, down from the previous estimate
of $3.8 billion. Adjusted EBITDA margin is likely to be 7.0% and
adjusted earnings per share are expected between 30 cents and 35
cents, increasing from the previous guidance of 25 cents to 35
In addition, the company expects capital expenditures between $50
million and $60 million for the fiscal year. Interest expense is
projected to be $105 million.
Headquartered in Troy, Mich., Meritor is a global automotive
parts manufacturer and supplier to various customers in North
America, Europe and other parts of the world. The company
operates manufacturing facilities in North America, South
America, Europe and Asia-Pacific.
Some of its big customers include
Navistar International Corporation
). Meritor retains a Zacks Rank #3 (Hold).
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