Why Dana's profits surged in Q2
New contracts and a richer product mix at drivetrain supplier Dana Inc. boosted net income nearly 75 percent to $ 124 million for the second quarter, on a 12 percent rise in revenue to $ 2.1 billion.
The outsize second-quarter increase included one-time tax benefits of $ 39 million but also a one-time charge of $ 20 million.
Year to date, net income was $ 232 million, up from $ 146 million in the same period a year ago, the company said Wednesday.
In a conference call, company executives said Dana was on track to grow revenue 12 percent for the full year, to come in at the high end of its previous estimate of $ 7.8 billion to $ 8.1 billion.
Dana logged additional profits from new contracts during the second quarter. But the Maumee, Ohio, supplier also is pursuing “inorganic” growth from strategic acquisitions, CEO James Kamsickas said during the call Wednesday.
Just before the end of the quarter, on June 22, Dana purchased a majority stake in Canada’s TM4 Inc. for $ 165 million Canadian ($ 127 million). That deal makes Dana more vertically integrated in producing components for electric vehicles and increases its reach in China.
Dana already makes electric gearboxes and thermal-management technologies for batteries, motors and inverters. Its product lineup overall includes axles, driveshafts, transmissions, gaskets and thermal-management technologies such as transmission and engine-oil cooling, battery and electronics cooling, and exhaust-gas heat recovery.
TM4, a subsidiary of Canada’s largest electricity producer, Hydro-Quebec, makes electric motors, power inverters and control systems for light vehicles as well as for commercial vehicles, marine, mining, rail, motorsports and recreational-vehicle applications.
Hydro-Quebec retains 45 percent of TM4, based in Boucherville, Quebec.
Dana ranks No. 36 on the Automotive News list of the top 100 global suppliers, with worldwide parts sales to automakers of $ 7.21 billion in 2017.
Let’s block ads! (Why?)