Meritor Inc. ( MTOR ) reported a profit of $11 million or 12 cents per share in the first quarter of fiscal 2012 compared with a loss of $3 million or 4 cents per share in the same quarter of prior fiscal year (all excluding restructuring charges). However, the profit was lower than the Zacks Consensus Estimate of 20 cents per share.
Including restructuring charges, profit was $13 million or 13 cents per share in the quarter under review compared with a loss of $6 million or 7 cents per share in the prior-year quarter.
Sales went up 21% to $1.2 billion from the first quarter of fiscal 2011. This increase in sales was primarily due to stronger truck demand in all regions.
Adjusted EBITDA rose to $79 million from $65 million in the first quarter of fiscal 2011 due to the positive impact from increased sales, partially offset by higher material costs. Adjusted EBITDA margin was flat at 6.8% compared with the same period last year.
Commercial Truck sales grew 31% to $751 million. Segment EBITDA was $47 million for the quarter, up $14 million from the year-ago level driven by increased sales in all regions, partially offset by higher material costs.
Industrial segment sales rose 8% to $248 million, driven by the company's on-highway business in India. Segment EBITDA was $11 million, down $6 million from the same period last year due to unfavorable changes in sales mix and higher material costs compared with the prior year.
Aftermarket & Trailer segment sales went up 11% to $235 million driven by sales gains in North America. Segment EBITDA was $20 million, up $4 million from the first quarter of fiscal 2011, primarily due to the favorable impact of higher sales.
Meritor had cash and cash equivalents of $211 million as of December 31, 2011, marginally down from $217 million as of September 30, 2011. Long-term debt was flat at to $1.0 billion as of December 31, 2011 compared with the same as of September 30, 2011. The company had a shareholder deficit of $983 million as of December 31, 2011 compared with $961 million as of September 30, 2011.
In the quarter, Meritor's operating cash flow was $5 million compared with an outflow of $49 million in the same quarter of fiscal 2011. Capital expenditures increased to $25 million from $19 million in the prior fiscal year. Free cash flow from continuing operations before restructuring charges was minus $10 million compared with minus $34 million a year ago.
For fiscal 2012, Meritor anticipates revenues to be $4.8 billion, adjusted EBITDA margin in the range of 8.2%-8.6%, adjusted profit in the range of $105 million-$135 million or $1.08-$1.39 per share. It also expects capital expenditures between $100 million and $110 million and free cash flow before restructuring charges in the range of $25 million to $75 million for the fiscal year.
Headquartered in Troy, Michigan, Meritor, a Zacks #3 Rank (short-term Hold rating) stock, is a global automotive parts manufacturer and supplier to various customers in North America, Europe and other parts of the world. It is a worldwide supplier of a broad range of integrated systems, modules and components for commercial, specialty and light vehicles worldwide, and has developed leading positions in most of its markets.
The company operates manufacturing facilities in 19 countries across North America, South America, Europe and Asia-Pacific. Some of its big customers include VolvoAB ( VOLVY ), Navistar International Corporation ( NAV ) and Daimler AG ( DDAIF ).
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