Auto supplier Dana Inc. said net income dropped by nearly 85 percent in the second quarter, reflecting lower operating earnings caused by the unfavorable impact of foreign currency values, a spike in costs and supply chain challenges.
Dana reported net income of $8 million — a drop of $45 million from a year earlier. The company blamed the plunge primarily on inflation, resulting in higher operating costs including labor, energy, transportation and raw materials.
There were some bright spots for the Maumee, Ohio-based axle and transmission producer. Sales increased by about 17 percent to $2.59 billion, and free cash flow rose to $167 million compared with negative cash flow of $13 million in the same period a year earlier.
Electric vehicle product sales, which CEO James Kamsickas said in April will become a top priority, grew by an incremental $59 million.
Light-vehicle product sales climbed 16 percent from 2021 to about $1.03 billion. Commercial vehicle sales growth was double that, increasing 31 percent to $507 million.
Adjusted earnings before interest, taxes, depreciation and amortization fell about 30 percent to $162 million.
Most of Dana's headwinds are not unique, with the company citing commodity costs, inflation and foreign currency translation as primary obstacles during the quarter and near future.
Dana lowered its 2022 earnings forecast to an average of 75 cents per share, down from the outlook it gave in the first quarter of an average of $1.33 per share.
Dana shares were trading at $15.78 as of Friday afternoon, a decrease of 5.6 percent since the market closed Tuesday.