ArvinMeritor Loss Widens

The auto-parts supplier has a brighter outlook for fiscal 2007.
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ArvinMeritor

(ARM)

posted a wider fourth-quarter loss, hit by restructuring costs and one-time charges.

The Troy, Mich.-based auto-parts supplier recorded a loss of $274 million, or $3.95 a share, in the quarter ended Sept. 30, compared with a loss of $19 million, or 27 cents a share, a year ago.

Excluding a $310 million goodwill impairment charge and other one-time items, the company earned 40 cents a share from continuing operations. Analysts surveyed by Thomson First Call were expecting earnings of 40 cents a share in the most recent quarter.

Fourth-quarter revenue rose 7% to $2.27 billion due to strength in the North American commercial vehicle markets and increased sales from its axle joint ventures with the Volvo group in Europe.

The top line exceeded analysts' average forecast for revenue of $2.13 billion.

For fiscal 2007, ArvinMeritor anticipates earnings from continuing operations of $1.15 a share to $1.25 a share, before items. Wall Street expects earnings of $1.07 a share.

The company fiscal 2007 revenue of $8.7 billion to $8.9 billion, above Wall Street's forecast of $8.58 billion.

ArvinMeritor also announced a new program called "Performance Plus" aimed toward improving profitability.

"While our performance has been respectable compared to peers in our segment, we believe we have the potential to deliver better results," the company said. "To that end, we are announcing a major new profit improvement initiative designed to improve cash flow, drive earnings power, and ultimately improve shareowner value.

"With the launch of Performance Plus, and the leadership of a talented executive management team, we are positioning ArvinMeritor for profitable growth and sustainable results above industry returns."

The company's shares recently advanced 55 cents, or 3.4%, to $16.75 in after-hours trading.

This story was created through a joint venture between TheStreet.com and IRIS.