DOW JONES NEWSWIRES
Dana Holding Corp. (DAN) swung to a first-quarter loss on a
prior-year gain related to its exit from bankruptcy as the company
cut 5,000 more jobs during the quarter.
The auto-parts maker also said it was offering to buy back up to
10% of the existing $1.26 billion under its term loan facility. The
company said the repurchase likely would be finished later this
month.
The company had already cut 5,000 jobs last year and had said it
would close up to 10 more plants than expected this year and
next.
U.S. auto-parts manufacturers are suffering as auto makers
struggle with plunging sales. The drop in business, combined with a
credit crunch that has choked off access to rescue financing, could
prove disastrous to an industry already hit by bankruptcies.
Dana's shares were up 3.5% at $2.05 in recent premarket
action.
"Our first-quarter results were hit hard by the continued global
recession," Chairman and Chief Executive John Devine said. He added
the company was making progress on its cost cuts and improving
margins.
The company posted a loss of $157 million, compared with
year-earlier income of $659 million. The prior year's results
included $754 million in bankruptcy gain. On a per-share basis, the
latest quarter's loss was $1.64.
Revenue decreased 47% to $1.22 billion.
Despite its exit from Chapter 11 last year, Dana has faced
trouble in the past several months. Standard & Poor's Ratings
Services said last week that it would consider another cut to
Dana's ratings, among other auto-parts makers, if General Motors
Corp. (GM) were to file for bankruptcy. Dana's credit ratings were
downgraded deeper into junk territory late last year by S&P and
Moody's Investors Services.
-By Kerry E. Grace, Dow Jones Newswires; 201-938-5089;
kerry.grace@dowjones.com