TROY, Mich. -- ArvinMeritor, Inc today provided additional details about its expectations for stronger financial results in the third fiscal quarter and full fiscal year.

Third Fiscal Quarter
Despite weaker than anticipated industry conditions in North America, the company expects sales for the third quarter of approximately $2 billion, up 20 percent from the third quarter of 2007. This growth in sales is due primarily to stronger industry conditions and market share in South America and Asia Pacific; a favorable light vehicle platform mix in Europe; and increased specialty sales, including military products in North America and off-highway products in China.

The company expects operating earnings and margins for the quarter to follow normal seasonal patterns when compared to prior quarters, with an additional benefit from increased sales. Our strategy to refocus, restructure and regenerate the business continues to show results, said Chip McClure, chairman, CEO and president of ArvinMeritor. Our balanced geographical footprint and product mix is offsetting the weak market we're experiencing in North America.

In addition to higher sales and operating improvements, the company also will benefit from a lower tax rate in the third fiscal quarter. Previous tax rate guidance reflected an abnormally high rate for the first half of the fiscal year, followed by a low rate for the second half. Inherent in this guidance was an expected one-time benefit of $15 million to $19 million in continuing operations for the second half of the year due to the resolution of certain prior-year tax matters. The company now anticipates this benefit to be realized entirely in the third quarter.

For the full fiscal year, the company now anticipates earnings at the high end of its previous guidance range of $1.40 to $1.60 per diluted share from continuing operations, before special items due to increased sales.

For the 2008 calendar year, the company anticipates light vehicle industry sales in North America to be in the range of 14.4 million to 14.6 million units, down from the previously forecasted estimate of 15.2 million. The company does not expect this change in forecast to affect its plan to spin off its Light Vehicle Systems (LVS) business, given that less than 20 percent of the company's light vehicle sales are to the domestic three manufacturers in North America.

The company's expectation for Class 8 production in North America for the 2008 calendar year is a range of 195,000 to 205,000 units, down from the previous range of 220,000 to 240,000. The company expects higher production in 2009, although the anticipated pre-buy related to the 2010 emissions change is likely to be significantly smaller than originally believed. In Western Europe, the company's expectation for medium- and heavy-duty truck production is 550,000 to 560,000 units for 2008, down from the previous range of 580,000 to 590,000 units.

In spite of the volume decline in Europe and continued depressed sales and production forecasts in North America, our team has worked diligently to make operational improvements across the business, said McClure.

Today, ArvinMeritor, Inc. is a premier global supplier of a broad range of integrated systems, modules and components to the motor vehicle industry. The company serves commercial truck, trailer and specialty original equipment manufacturers and certain aftermarkets, and light vehicle manufacturers.

Courtesy: ArvinMeritor Inc, USA

Add a comment

Posted by Naresh Koshti on 3 July, 2008 10:46:05 AM IST #