Truck component manufacturer Meritor Inc. on Wednesday reported quarterly financial results showing a big increase in profit despite a small drop in sales.
During its fiscal first quarter ending Dec. 31 of last year, net income totaled $29 million compared to $11 million a year earlier with earnings per diluted share of 29 cents compared to 11 cents.
Revenue fell to $870 million from $900 million a year earlier, primarily due to lower commercial truck production and unfavorable exchange rates in Europe and South America, as well as lower revenue from Meritor’s defense business, according to the company. This was partially offset by higher sales in North America as the Class 8 truck market continued to strengthen.
Commercial truck and industrial sales totaled $703 million during the quarter, down $24 million compared to the same period last year. Segment earnings before certain expenses totaled $56 million for the quarter, up $3 million over the same time period.
The aftermarket and trailer segment posted sales of $208 million, up $6 million from the same period a year ago. Segment earnings before certain expenses totaled $25 million, up $4 million from a year earlier. The increase was primarily due to slightly higher revenue in North America and pricing actions the company took last year, according to Meritor.
Meritor also revised its 2015 guidance by forecasting revenue to be approximately $3.7 billion, down from an earlier expectation of $3.8 million, while adjusted earnings per share from continuing operations was unchanged at between $1.20 and $1.30.
Meritor also announced a long-term contract with the parent of truck makers Kenworth, Peterbilt and others. A seven-year agreement with Paccar gives it preferred product positioning for rear axles in North America and Australia. In addition, Meritor now has enhanced optional positioning for brakes, drivelines and front axles, according to the company.