and will cut its workforce this year more than planned.
The company reported sales of $1,929 million, a 9-percent decrease compared with 2007, primarily because of lower vehicle production in North America. A net loss of $271 million included $123 million of non-cash goodwill and other impairment charges. This compares with a third-quarter 2007 net loss of $69 million.
Earnings before interest, taxes, depreciation, amortization, and restructuring (EBITDA) were $15 million, compared with $126 million in 2007. Lower production and higher steel costs of $140 million more than account for this reduction. Results also included higher pricing, cost savings, and unfavorable currency changes. The company reported a strong cash balance of $1 billion and total liquidity of $1.3 billion as of Sept. 30. Net debt was $380 million.
"The economic and market challenges we've faced all year were particularly difficult in the third quarter," said Executive Chairman John Devine. "The combination of lower industry volumes and peaking steel prices hit us sharply this quarter."
Dana is planning up to 10 additional plant closures in 2009 and 2010, and will reduce its workforce this year by 5,000, compared to the previously announced 3,000.
Sales for the nine months of the year were were $6,574 million, which compares to $6,564 million for the same period in 2007. Year to date, the company reported net income of $274 million compared with a net loss of $294 million for the same period in 2007. The nine-month 2008 results include a net gain of $754 million recognized in connection with the company's emergence from bankruptcy and application of fresh start accounting in January.
Year-to-date EBITDA of $290 million compares to $373 million for the same period in 2007, as the earnings reduction related to lower North American vehicle production and higher steel costs more than offset cost reduction actions and pricing improvements.
Based on current production estimates, Dana expects full-year 2008 sales of approximately $8,200 million and EBITDA of approximately $300 million.
"The second half of this year has been extremely challenging with sharply lower North American vehicle production, volatile steel prices, and turmoil in the financial markets," said Jim Yost, executive vice president and chief financial officer. "With respect to our credit facility, Dana is in compliance with financial covenants through September 30, 2008; however, we will not be able to comply with these requirements, as presently structured, at December 31, 2008. We expect to complete an amendment to the facility with our lenders in the next few weeks."
In 2009 Dana expects to improve EBITDA by at least $150 million, primarily through pricing actions and cost reductions, and is targeting break-even or better free cash flow.