MAUMEE, Ohio—Automotive supplier Dana Inc. will update its financial guidance in response to its customers reducing their production levels because of the coronavirus crisis.
The manufacturer of sealing, thermal and electrodynamic parts and technologies said March 24 it is adapting to rapidly changing demand as it takes steps to protect employees and manage costs.
Last year, the Maumee, Ohio-based company had posted sales of $8.6 billion, which was up 6 percent from 2018.
The company had given 2020 guidance of $8.5 billion—with a give or take of $250 million—back on Feb. 13, noting weaker end-market demand for heavy vehicles had emerged in the second half of 2019 and was expected to continue this year.
However, Dana is now withdrawing that guidance because it didn't factor in a COVID-19 pandemic, which was declared about a month after the February quarterly presentation and conference call. Because of the outbreak, the company said it is adjusting production schedules and idling certain manufacturing facilities, but released no details.
Dana officials said results for the first quarter will be impacted primarily by the changes in customer production schedules in the second half of March.
"We believe Dana has ample liquidity to manage significantly lower production volumes," Jonathan Collins, executive vice president and chief financial officer, said a statement. "We are flexing our cost structure to match the lower level of demand and, combined with our strong balance sheet, positions us to navigate the current environment."
The company had $527 million in cash and marketable securities at the end of 2019 and $979 million available on its committed revolving credit facility for total liquidity of more than $1.5 billion.
The company also noted that it has no meaningful debt maturities before 2024.
Dana will provide an update on market conditions on its first-quarter earnings call, which hasn't been announced yet, according to a Dana spokesman.