Allison Transmission Holdings Inc. said Monday (April 15) that it expects its first-quarter net income to fall by more than half, but that would still beat current Wall Street predictions.
According to an Associated Press report, the Indianapolis-based company, which makes automatic transmissions for commercial, military and transit vehicles, also said it’s doubling its quarterly cash dividend and announced that some of its shareholders plan to sell 22 million shares of its stock in an offering.
For the quarter ended March 31, Allison projected net income of $27.5 million, down from $58 million in the year-ago period. Revenue is expected to total $455 million to $460 million, compared with $601.9 million a year ago.
Analysts, on average, expect earnings of $21.2 million on $459.3 million in revenue, according to FactSet.
The company said the quarter’s results reflect considerably lower North American demand for equipment used in hydraulic fracturing, along with lower defense sales.
Allison reaffirmed its full-year guidance of a sales decline of between 6% and 8%. Based on the company’s 2012 results, the guidance implies 2013 revenue of between $1.97 billion and $2.01 billion. Analysts expect $1.99 billion.
The company said that for the full-year, it still expects low demand from the North Americas hydraulic fracturing market and reductions to U.S. defense spending, along with lower demand for North American hybrid-propulsion systems used in buses.
Indianapolis-based Allison Transmission Holdings Inc. announced that members of the International Union, United Automobile, Aerospace and Agricultural Workers of America (UAW) Local 933 ratified a new five-year collective bargaining agreement (CBA) which becomes effective Dec. 3 and will expire on Nov. 14, 2017.
According to a press release, some of the key economic provisions from the new CBA include a $5,000 ratification bonus, maintenance of a multi-tier wage and benefit system, and an annual incentive compensation program.
Pension rates under the CBA are unchanged and the company match for tier two employee contributions to the 401(k) plan increased from 5% to 6%. The parties also agreed to modify retiree healthcare, more closely aligning it with the benefits offered in the Voluntary Employee Beneficiary Association (VEBA) trust covering retired U.S. auto workers from Ford Motor Co., Chrysler Group and General Motors Co.
The new CBA covers approximately 1,550 hourly employees who primarily work in the Indianapolis area. Allison is a major suppliers of motorhome transmissions.
Allison Transmission Inc. reported earnings of nearly $413 million in the second quarter after losing $17.2 million in the same period a year ago.
Indiana Business Journal reported that despite the healthy profit, the Indianapolis-based manufacturer cut its full-year sales-growth forecast to a range of 1% to 3% compared to a prior estimate of 5% to 7%.
Allison, a supplier of motorhome transmissions to the RV industry, said quarterly profit was boosted significantly by a one-time $350 million income tax benefit. On a per-share basis, earnings were $2.28 compared to a loss of 9 cents in last year’s second period.
Quarterly revenue rose 1%, to $559 million.
Allison’s performance was boosted by a 43% sales increase in parts for overseas off-highway vehicles and a 16% rise in military sales. Revenue fell almost equally in North America markets.
The earnings report was Allison’s second since its initial public offering, which raised $600 million earlier this year.
The company reported a $58 million profit on $602 million in the first quarter.
Allison said its new full-year sales forecast reflects “a cautious approach given heightened market uncertainty.”
Allison Transmission Inc. says it is investing more than $130 million to make drive systems for commercial hybrid trucks at a facility that will employ nearly 100 workers.
The company says it is gutting a dormant Indianapolis plant and transforming it into a high-tech facility that, once fully operational, will be capable of producing 20,000 propulsion systems for hybrid vehicles with pick up and delivery, shuttle and utility applications, according to a news release.
Allison Transmission, Remy International Inc. and Delphi Automotive Systems LLC are partnering on production of the hybrid system that is expected to be available by the end of 2013.
During a visit to Elkhart, Ind., last August, President Obama awarded Allison Transmission a $62.8 million U.S. Department of Energy grant to increase hybrid manufacturing capacity.
Allison Transmission has been producing hybrid systems for city buses since 2003. The company says nearly 3,000 buses worldwide are using its hybrid propulsion systems. Just last week, it was announced that transit systems in Indianapolis, Lafayette and Fort Wayne will be receiving new hybrid buses.
Allison Transmission Inc., the premier global designer and manufacturer of medium and heavy-duty automatic transmissions and hybrid propulsion systems, today (June 3) announced it has manufactured its one millionth 1000/2000 Series transmission.
Jim Wanaselja, vice president of North American Marketing Sales and Service for Allison Transmission, will present Bob Mann, vice president of Dealer Sales for Navistar International Inc., with the milestone transmission during a ceremony held at Allison’s world headquarters this afternoon, according to a news release.
“Allison Transmission is proud to be able to share this important milestone with our valued customer Navistar,” said Wanaselja.
Mann appreciated Navistar’s involvement with the celebration. “On behalf of Navistar, I would like to express how much we value our corporate relationship with Allison Transmission, and what an honor it is to receive not only a great product, but a legendary one at that,” said Mann.
1000/2000 Series transmissions are used in a variety of applications including, distribution, construction, school buses, emergency vehicles and motorhomes. Allison fully automatic transmissions, with torque converter technology, provide superior vehicle performance, increased productivity, reduced driveline wear and tear and lower overall vehicle life cycle costs.