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Tenneco Reports Fourth Quarter And Full-Year 2012 Financial Results

Stocks in this article: TEN

Outlook

The company will provide its annual guidance and outlook for 2013 on February 14 during its previously announced investor and analyst meeting in New York. Chairman and Chief Executive Officer, Gregg Sherrill, Chief Operating Officer, Hari Nair, Chief Financial Officer, Ken Trammell, and other members of the global management team will review the company’s strategy, discuss business operations, and provide guidance including revenue, capital expenditures, interest expense and cash taxes.

Based on IHS Automotive forecasts for first quarter 2013, Tenneco anticipates global OE light vehicle production volumes will be slightly lower, down 2% year-over-year. North America is expected to be down 2%, Europe down 10%, India down 12%, China up 8% and South America up 5%. Tenneco also expects that commercial vehicle volumes will be lower year-over-year in the first quarter, as Power Systems Research is forecasting a 17% decline in North America class 4-7 production, and the company expects no improvement in the emissions regulated off-road market, Tenneco’s largest commercial vehicle business.

The aftermarket business in the first quarter is expected to be essentially flat year-over-year in North America, with the European aftermarket remaining weak due to ongoing macroeconomic conditions throughout the region.

Given the lower global OE light vehicle production and continued weakness in commercial vehicle markets, Tenneco anticipates its total revenue in the first quarter will be down slightly year-over-year.

Tenneco continues to take actions to address the ongoing challenges in Europe. In the third quarter, the company announced plans to close an aftermarket facility in Vittaryd, Sweden, and today, the company is announcing its intention to make additional fixed cost reductions in Europe. Including the Vittaryd closure, the company plans to reduce structural costs in Europe by $60 million annually, and anticipates related costs of approximately $120 million. Tenneco expects that most of the expense will be recorded in late 2013 and 2014, and that the company will reach a full savings run rate in 2016.

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