Tenneco Automotive Reports 2001 First Quarter Earnings

- Company reports net loss of $16 million, or 44 cents per diluted share,

before restructuring and other unusual charges;

- Revenue declines two percent year-over-year to $864 million;

- Working capital, as a percent of sales, improves from 16.7% to 13.7%

($100 million improvement);

- SGA&E, as a percent of sales, decreases from 13.8% to 11.9% ($18 million

improvement).



Apr 24, 2001, 01:00 ET from Tenneco Automotive

    LAKE FOREST, Ill., April 24 /PRNewswire Interactive News Release/ --
 Tenneco Automotive (NYSE:   TEN) reported a net loss of $31 million, or 84 cents
 per diluted share, for the first quarter of 2001.  These results include
 pre-tax restructuring charges of $12 million (23 cents per share), pre-tax
 environmental charges of $6 million (12 cents per share), and pre-tax charges
 associated with the company's re-negotiation of its senior debt agreements of
 $2 million (5 cents per share).
     The company reported a net loss of $16 million, or 44 cents per diluted
 share, for the first quarter of 2001, before restructuring charges and other
 unusual charges, compared to net income of $1 million, or 3 cents per diluted
 share, for the first quarter of 2000.
     The company's revenue and profitability continue to be impacted by
 downturns in North American light vehicle and heavy-duty truck production as
 well as the depressed global aftermarket, despite strong performances during
 the quarter by its European original equipment and rest of world operations.
 Revenue for the quarter was $864 million versus $878 million in the first
 quarter of 2000.  EBITDA for the quarter, excluding restructuring and other
 unusual charges, was $63 million compared with $86 million the previous year,
 a 27 percent decline.
     The company reported that cash flow from operations during the quarter,
 while negative, did not decline as much as the decline in EBITDA.  At quarter
 end, working capital, before factored receivables, improved by $100 million
 compared to the first quarter 2000, as the company enhanced its receivables
 performance by three days and shrunk inventory levels by six days.  A
 $9 million decrease in capital spending and lower taxes also contributed to
 this cash flow improvement.  Additionally, the company reduced its SGA&E
 expense by $18 million year-over-year, as a result of previously announced
 restructuring initiatives.
     "We continue to focus on the key areas that we can control --
 manufacturing costs, SGA&E, discretionary spending, and working capital -- in
 order to meet the immediate challenges caused by the difficult industry
 conditions," said Mark P. Frissora, chairman and CEO, Tenneco Automotive.
     The company reported the following geographical results before
 restructuring and other unusual charges:
 
     NORTH AMERICA
     North American original equipment revenue declined 15 percent during the
 quarter to $324 million versus $382 million in the first quarter of 2000.
 North American aftermarket revenue decreased 13 percent to $111 million from
 $128 million in the previous year.
     North American EBIT declined to $6 million versus $34 million in the first
 quarter of 2000.  EBIT was primarily impacted by lower revenues, including a
 significant downturn in the high margin heavy-duty elastomer business.
 Operating inefficiencies and aftermarket bad debt expense also contributed to
 the decline.
 
     EUROPE
    Driven by increased original equipment exhaust volumes, European original
 equipment revenue increased 36 percent to $275 million compared to
 $202 million in the previous year.  European aftermarket revenue declined 20
 percent to $74 million versus $92 million in first quarter of 2000.
     European EBIT increased 33 percent to $16 million for the quarter.  This
 increase was driven primarily by operational improvements in the European
 original equipment exhaust business.
 
     REST OF WORLD
     The company's Australian operations reported a 10 percent revenue decline
 from $29 million to $26 million; however, revenue would have increased 5
 percent if currency exchange rates had been the same in the first quarter of
 2000 as in the first quarter of 2001.
     The launch of new original equipment programs in South America fueled a 9
 percent increase in revenue to $36 million, from $33 million in 2000.
     Revenue from Asian operations grew 64 percent to $18 million from
 $11 million in the first quarter of 2000, driven by production from the
 company's new facility in Shanghai and aftermarket volumes.
     Combined EBIT for South America, Australia, and Asia was $4 million
 compared to $2 million in the previous year, primarily the result of volume
 increases.
 
     "We are by no means satisfied with our results," Frissora said. "However,
 we are encouraged by progress we've made in reducing our overhead costs and
 spending, and our entire organization is determined to make additional
 improvement in these areas in the second quarter and throughout 2001."
     The attached exhibits provide additional information on Tenneco
 Automotive's first quarter 2001 operating results.
     The company will host a conference call on April 24, 2001 at 10:30 a.m.
 EDT.  The dial-in number is 877-915-2770 domestic or 1-312-470-0017
 international.  Passcode is Tenneco Auto.  A recording of this call will be
 available from 1:00 p.m. EDT on April 24 through May 1.  To access this
 recording, dial 800-568-4850 domestic or 402-220-2274 international, and enter
 passcode 8400.  The call will also be available on the Tenneco Automotive web
 site at www.tenneco-automotive.com .
     Tenneco Automotive is a $3.5 billion manufacturing company headquartered
 in Lake Forest, Ill., with 23,000 employees worldwide.  Tenneco Automotive is
 one of the world's largest producers and marketers of ride control and exhaust
 systems and products, which are sold under the Monroe(R) and Walker (R) global
 brand names.  Among its products are Sensa-Trac(R) and Reflex(TM) shocks and
 struts, Rancho(R) shock absorbers, Walker(R) Quiet-Flow(TM) mufflers and
 DynoMax(TM) performance exhaust products, and Monroe(R) Clevite(TM) vibration
 control components.
 
 
              TENNECO AUTOMOTIVE INC CONSOLIDATED EARNINGS RESULTS
                                   Unaudited
                          THREE MONTHS ENDED MARCH 31,
 
                                                         2001           2000
     Net sales and operating revenues:                   $864          $878(d)
 
     Costs and Expenses
       Cost of Sales (exclusive of depreciation
        shown below)                                      706(a)(b)      672
       Engineering, Research and Development               13             15
       Selling, General and Administrative                101(a)(c)    106(d)
       Depreciation and Amortization                       37             39
         Total Costs and Expenses                         857            832
 
     Other Income (Expense)                                (1)             1
 
     Operating Income (Loss)
       North America                                       (3)(a)(b)(c)   34
       Europe                                               8(a)(b)(c)    12
       Rest of World                                        1(a)(b)        1
                                                            6             47
     Less.
       Interest expense (net of interest capitalized)      47             45
       Income tax expense (benefit)                       (10)            (1)
       Minority interest                                    -              2
     Net income (loss)                                   $(31)            $1
 
     Average common shares outstanding
       Basic                                             36.6           33.7
       Diluted                                           36.8           33.9
 
     Earnings (loss) per share of common stock:
       Basic-                                         $ (0.84)         $0.03
       Diluted-                                       $ (0.84)         $0.03
 
     (a) Includes restructuring and other charges of $12 million pre-tax,
         $9 million after-tax or $0.23 per share. Of the charge, $10 million is
         recorded in SG&A and the remaining $2 million is in cost of sales.
         Geographically, $8 million is recorded in North America, $2 million in
         Europe and $2 million in Rest of World.
 
     (b) Includes environmental charges of $6 million pre-tax, $5 million
         after-tax or $0.12 per share. The entire charge is recorded in cost
         of sales. Geographically, $5 million is recorded in Europe and $1
         million is in North America.
 
     (c) Includes costs associated with the renegotiation of senior debt of
         $2 million pre-tax, $2 million after-tax or $0.05 per share. The
         entire charge is recorded in SG&A. Geographically, $1 million is
         recorded in both North America and Europe.
 
     (d) Pursuant To EITF Issue No. 00-14. Accounting for Certain Sales
         Incentives, some incentives that were previously recorded in SG&A are
         now classified as a reduction in revenues. Results for 2000 were
         reclassified accordingly, with net sales and SG&A each reduced by
         $4 million with no impact on income.
 
             Tenneco Automotive Inc. and Consolidated Subsidiaries
                                 Balance Sheet
                                  (unaudited)
                                   (Millions)
 
                                                      March 31,   December 31,
                                                         2001            2000
                                                        Actual          Actual
 
     ASSETS
       CASH                                                56             35
       RECEIVABLES, Net                                   499            487
       INVENTORIES                                        409            422
       OTHER CURRENT ASSETS                               163            165
       TOTAL CURRENT ASSETS                             1,127          1,109
       INVESTMENTS AND OTHER ASSETS                       778            772
       PLANT, PROPERTY, AND EQUIPMENT, NET                964          1,005
       TOTAL ASSETS                                    $2,869         $2,886
 
     LIABILITIES AND SHAREOWNERS' EQUITY
       SHORT-TERM DEBT                                    188             92
       ACCOUNTS PAYABLE                                   465            464
       OTHER CURRENT LIABILITIES                          187            202
       ACCRUED TAXES                                       17             16
       ACCRUED INTEREST                                    47             35
       LONG-TERM DEBT                                   1,409          1,435
       DEFERRED INCOME TAXES                              136            144
       DEFERRED CREDITS AND OTHER LIABILITIES             158            154
       MINORITY INTEREST                                   15             14
       TOTAL SHAREHOLDERS' EQUITY                         247            330
       TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY      $2,869         $2,886
 
 
             Tenneco Automotive Inc. and Consolidated Subsidiaries
                            Statement of Cash Flows
                                   (Millions)
 
                                                         Three Months Ended
                                                              March 31,
                                                        2001             2000
     Operating activities:
       Income (loss) from continuing operations          $(31)            $1
       Adjustments to reconcile income (loss) from
        continuing operations to net cash provided
        (used) by operating activities --
          Depreciation and amortization                    37             39
          Deferred income taxes                           (18)            --
          (Gain)/loss on sale of businesses and
           assets, net                                      2             --
          Changes in components of working capital --
           (Inc)/dec in receivables                       (35)           (71)
           (Inc)/dec in inventories                        (4)           (13)
           (Inc)/dec in prepayments and other current
             assets                                        (5)            (4)
           Inc./(dec) in payables                          16             50
           Inc./(dec) in taxes accrued                     --            (11)
           Inc./(dec) in interest accrued                  13             17
           Inc./(dec) in other current liabilities         (6)           (13)
          Other                                             2              1
     Net cash provided (used) by operating activities     (29)            (4)
 
     Investing activities:
       Net proceeds from sale of assets                    --              2
       Expenditures for plant, property & equipment       (25)           (34)
       Acquisition of businesses                            -              -
       Investments and other                               (5)            (4)
     Net cash provided (used) by investing activities     (3O)           (36)
 
     Net Cash provided (used) before financing activities
      - continuing operations                             (59)           (40)
 
     Financing activities:
       Issuance of common and treasury shares               3             --
       Proceeds from subsidiary equity issuance            --             --
       Purchase of common stock                            --             --
       Issuance of equity securities by a subsidiaries     --             --
       Issuance of long-term debt                          --             --
       Retirement of long-term debt                        (5)             -
       Net inc./(dec.) in Short-term debt excluding
        current maturities an long-term debt               78             13
       Dividends (common)                                  --             (2)
       Other                                               --             --
     Net cash provided (used) by financing activities      76             11
 
     Effect of foreign exchange rate changes on cash and
      temporary cash investments                            4             (2)
     Inc./(dec.) in cash and temporary cash investments    21            (31)
     Cash and temporary cash investments, January 1        35             84
     Cash and temporary cash investments, March 31        $56            $53
 
     Cash paid during the period for interest             $34            $29
     Cash paid during the period for income taxes          $8            $15
 
                     MAKE YOUR OPINION COUNT -  Click Here
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SOURCE Tenneco Automotive
    LAKE FOREST, Ill., April 24 /PRNewswire Interactive News Release/ --
 Tenneco Automotive (NYSE:   TEN) reported a net loss of $31 million, or 84 cents
 per diluted share, for the first quarter of 2001.  These results include
 pre-tax restructuring charges of $12 million (23 cents per share), pre-tax
 environmental charges of $6 million (12 cents per share), and pre-tax charges
 associated with the company's re-negotiation of its senior debt agreements of
 $2 million (5 cents per share).
     The company reported a net loss of $16 million, or 44 cents per diluted
 share, for the first quarter of 2001, before restructuring charges and other
 unusual charges, compared to net income of $1 million, or 3 cents per diluted
 share, for the first quarter of 2000.
     The company's revenue and profitability continue to be impacted by
 downturns in North American light vehicle and heavy-duty truck production as
 well as the depressed global aftermarket, despite strong performances during
 the quarter by its European original equipment and rest of world operations.
 Revenue for the quarter was $864 million versus $878 million in the first
 quarter of 2000.  EBITDA for the quarter, excluding restructuring and other
 unusual charges, was $63 million compared with $86 million the previous year,
 a 27 percent decline.
     The company reported that cash flow from operations during the quarter,
 while negative, did not decline as much as the decline in EBITDA.  At quarter
 end, working capital, before factored receivables, improved by $100 million
 compared to the first quarter 2000, as the company enhanced its receivables
 performance by three days and shrunk inventory levels by six days.  A
 $9 million decrease in capital spending and lower taxes also contributed to
 this cash flow improvement.  Additionally, the company reduced its SGA&E
 expense by $18 million year-over-year, as a result of previously announced
 restructuring initiatives.
     "We continue to focus on the key areas that we can control --
 manufacturing costs, SGA&E, discretionary spending, and working capital -- in
 order to meet the immediate challenges caused by the difficult industry
 conditions," said Mark P. Frissora, chairman and CEO, Tenneco Automotive.
     The company reported the following geographical results before
 restructuring and other unusual charges:
 
     NORTH AMERICA
     North American original equipment revenue declined 15 percent during the
 quarter to $324 million versus $382 million in the first quarter of 2000.
 North American aftermarket revenue decreased 13 percent to $111 million from
 $128 million in the previous year.
     North American EBIT declined to $6 million versus $34 million in the first
 quarter of 2000.  EBIT was primarily impacted by lower revenues, including a
 significant downturn in the high margin heavy-duty elastomer business.
 Operating inefficiencies and aftermarket bad debt expense also contributed to
 the decline.
 
     EUROPE
    Driven by increased original equipment exhaust volumes, European original
 equipment revenue increased 36 percent to $275 million compared to
 $202 million in the previous year.  European aftermarket revenue declined 20
 percent to $74 million versus $92 million in first quarter of 2000.
     European EBIT increased 33 percent to $16 million for the quarter.  This
 increase was driven primarily by operational improvements in the European
 original equipment exhaust business.
 
     REST OF WORLD
     The company's Australian operations reported a 10 percent revenue decline
 from $29 million to $26 million; however, revenue would have increased 5
 percent if currency exchange rates had been the same in the first quarter of
 2000 as in the first quarter of 2001.
     The launch of new original equipment programs in South America fueled a 9
 percent increase in revenue to $36 million, from $33 million in 2000.
     Revenue from Asian operations grew 64 percent to $18 million from
 $11 million in the first quarter of 2000, driven by production from the
 company's new facility in Shanghai and aftermarket volumes.
     Combined EBIT for South America, Australia, and Asia was $4 million
 compared to $2 million in the previous year, primarily the result of volume
 increases.
 
     "We are by no means satisfied with our results," Frissora said. "However,
 we are encouraged by progress we've made in reducing our overhead costs and
 spending, and our entire organization is determined to make additional
 improvement in these areas in the second quarter and throughout 2001."
     The attached exhibits provide additional information on Tenneco
 Automotive's first quarter 2001 operating results.
     The company will host a conference call on April 24, 2001 at 10:30 a.m.
 EDT.  The dial-in number is 877-915-2770 domestic or 1-312-470-0017
 international.  Passcode is Tenneco Auto.  A recording of this call will be
 available from 1:00 p.m. EDT on April 24 through May 1.  To access this
 recording, dial 800-568-4850 domestic or 402-220-2274 international, and enter
 passcode 8400.  The call will also be available on the Tenneco Automotive web
 site at www.tenneco-automotive.com .
     Tenneco Automotive is a $3.5 billion manufacturing company headquartered
 in Lake Forest, Ill., with 23,000 employees worldwide.  Tenneco Automotive is
 one of the world's largest producers and marketers of ride control and exhaust
 systems and products, which are sold under the Monroe(R) and Walker (R) global
 brand names.  Among its products are Sensa-Trac(R) and Reflex(TM) shocks and
 struts, Rancho(R) shock absorbers, Walker(R) Quiet-Flow(TM) mufflers and
 DynoMax(TM) performance exhaust products, and Monroe(R) Clevite(TM) vibration
 control components.
 
 
              TENNECO AUTOMOTIVE INC CONSOLIDATED EARNINGS RESULTS
                                   Unaudited
                          THREE MONTHS ENDED MARCH 31,
 
                                                         2001           2000
     Net sales and operating revenues:                   $864          $878(d)
 
     Costs and Expenses
       Cost of Sales (exclusive of depreciation
        shown below)                                      706(a)(b)      672
       Engineering, Research and Development               13             15
       Selling, General and Administrative                101(a)(c)    106(d)
       Depreciation and Amortization                       37             39
         Total Costs and Expenses                         857            832
 
     Other Income (Expense)                                (1)             1
 
     Operating Income (Loss)
       North America                                       (3)(a)(b)(c)   34
       Europe                                               8(a)(b)(c)    12
       Rest of World                                        1(a)(b)        1
                                                            6             47
     Less.
       Interest expense (net of interest capitalized)      47             45
       Income tax expense (benefit)                       (10)            (1)
       Minority interest                                    -              2
     Net income (loss)                                   $(31)            $1
 
     Average common shares outstanding
       Basic                                             36.6           33.7
       Diluted                                           36.8           33.9
 
     Earnings (loss) per share of common stock:
       Basic-                                         $ (0.84)         $0.03
       Diluted-                                       $ (0.84)         $0.03
 
     (a) Includes restructuring and other charges of $12 million pre-tax,
         $9 million after-tax or $0.23 per share. Of the charge, $10 million is
         recorded in SG&A and the remaining $2 million is in cost of sales.
         Geographically, $8 million is recorded in North America, $2 million in
         Europe and $2 million in Rest of World.
 
     (b) Includes environmental charges of $6 million pre-tax, $5 million
         after-tax or $0.12 per share. The entire charge is recorded in cost
         of sales. Geographically, $5 million is recorded in Europe and $1
         million is in North America.
 
     (c) Includes costs associated with the renegotiation of senior debt of
         $2 million pre-tax, $2 million after-tax or $0.05 per share. The
         entire charge is recorded in SG&A. Geographically, $1 million is
         recorded in both North America and Europe.
 
     (d) Pursuant To EITF Issue No. 00-14. Accounting for Certain Sales
         Incentives, some incentives that were previously recorded in SG&A are
         now classified as a reduction in revenues. Results for 2000 were
         reclassified accordingly, with net sales and SG&A each reduced by
         $4 million with no impact on income.
 
             Tenneco Automotive Inc. and Consolidated Subsidiaries
                                 Balance Sheet
                                  (unaudited)
                                   (Millions)
 
                                                      March 31,   December 31,
                                                         2001            2000
                                                        Actual          Actual
 
     ASSETS
       CASH                                                56             35
       RECEIVABLES, Net                                   499            487
       INVENTORIES                                        409            422
       OTHER CURRENT ASSETS                               163            165
       TOTAL CURRENT ASSETS                             1,127          1,109
       INVESTMENTS AND OTHER ASSETS                       778            772
       PLANT, PROPERTY, AND EQUIPMENT, NET                964          1,005
       TOTAL ASSETS                                    $2,869         $2,886
 
     LIABILITIES AND SHAREOWNERS' EQUITY
       SHORT-TERM DEBT                                    188             92
       ACCOUNTS PAYABLE                                   465            464
       OTHER CURRENT LIABILITIES                          187            202
       ACCRUED TAXES                                       17             16
       ACCRUED INTEREST                                    47             35
       LONG-TERM DEBT                                   1,409          1,435
       DEFERRED INCOME TAXES                              136            144
       DEFERRED CREDITS AND OTHER LIABILITIES             158            154
       MINORITY INTEREST                                   15             14
       TOTAL SHAREHOLDERS' EQUITY                         247            330
       TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY      $2,869         $2,886
 
 
             Tenneco Automotive Inc. and Consolidated Subsidiaries
                            Statement of Cash Flows
                                   (Millions)
 
                                                         Three Months Ended
                                                              March 31,
                                                        2001             2000
     Operating activities:
       Income (loss) from continuing operations          $(31)            $1
       Adjustments to reconcile income (loss) from
        continuing operations to net cash provided
        (used) by operating activities --
          Depreciation and amortization                    37             39
          Deferred income taxes                           (18)            --
          (Gain)/loss on sale of businesses and
           assets, net                                      2             --
          Changes in components of working capital --
           (Inc)/dec in receivables                       (35)           (71)
           (Inc)/dec in inventories                        (4)           (13)
           (Inc)/dec in prepayments and other current
             assets                                        (5)            (4)
           Inc./(dec) in payables                          16             50
           Inc./(dec) in taxes accrued                     --            (11)
           Inc./(dec) in interest accrued                  13             17
           Inc./(dec) in other current liabilities         (6)           (13)
          Other                                             2              1
     Net cash provided (used) by operating activities     (29)            (4)
 
     Investing activities:
       Net proceeds from sale of assets                    --              2
       Expenditures for plant, property & equipment       (25)           (34)
       Acquisition of businesses                            -              -
       Investments and other                               (5)            (4)
     Net cash provided (used) by investing activities     (3O)           (36)
 
     Net Cash provided (used) before financing activities
      - continuing operations                             (59)           (40)
 
     Financing activities:
       Issuance of common and treasury shares               3             --
       Proceeds from subsidiary equity issuance            --             --
       Purchase of common stock                            --             --
       Issuance of equity securities by a subsidiaries     --             --
       Issuance of long-term debt                          --             --
       Retirement of long-term debt                        (5)             -
       Net inc./(dec.) in Short-term debt excluding
        current maturities an long-term debt               78             13
       Dividends (common)                                  --             (2)
       Other                                               --             --
     Net cash provided (used) by financing activities      76             11
 
     Effect of foreign exchange rate changes on cash and
      temporary cash investments                            4             (2)
     Inc./(dec.) in cash and temporary cash investments    21            (31)
     Cash and temporary cash investments, January 1        35             84
     Cash and temporary cash investments, March 31        $56            $53
 
     Cash paid during the period for interest             $34            $29
     Cash paid during the period for income taxes          $8            $15
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X55369308
 
 SOURCE  Tenneco Automotive