Meritor's sales in its first fiscal quarter were $1.159 billion, up $202 million or 21% from the same period last year.


This increase in sales was mainly due to stronger truck demand in all regions. Compared to the fourth quarter of fiscal year 2011, sales in the first quarter were down almost 5% due to normal seasonality and lower defense revenue.

"Our performance this quarter was in line with our expectations, driven primarily by higher commercial truck sales in all regions that helped us to deliver a 22% increase in Adjusted EBITDA year-over-year," says Chairman, CEO and President Chip McClure. "In addition, we completed key initiatives, including our European footprint rationalization and commercial truck pricing negotiations, which we expect to drive improving margins in the coming quarters."

Loss from continuing operations, on a GAAP basis, was $13 million or 13 cents per diluted share, compared to a loss from continuing operations of $6 million or 7 cents per diluted share in the prior year. Loss from continuing operations includes $24 million of restructuring charges (including $19 million of non-cash charges) primarily associated with the sale of the company's St. Priest, France, facility.

Adjusted income from continuing operations in the first quarter of fiscal year 2012 was $11 million, or $0.12 per diluted share, compared to an adjusted loss from continuing operations of $3 million, or $0.04 per diluted share, a year ago.

For the commercial truck segment, sales were $751 million, up $176 million from the same period last year. Segment EBITDA for the Commercial Truck segment was $47 million for the quarter, up $14 million from the first quarter of fiscal year 2011, primarily driven by increased sales in all regions partially offset by higher material costs.

For fiscal year 2012, the company expects the following results from continuing operations:

- Revenue to be approximately $4.8 billion.
- Adjusted EBITDA margin in the range of 8.2% to 8.6%.
- Adjusted income from continuing operations in the range of $105 million to $135 million.
- Adjusted earnings per share in the range of $1.08 to $1.39.
- Free cash flow before restructuring payments in the range of $25 million to $75 million.
- Effective tax rate of approximately 40%.

The company continues to plan the following for its continuing operations:

- Capital expenditures in the range of $100 million to $110 million.
- Interest expense in the range of $85 million to $95 million.
- Cash interest in the range of $75 million to $85 million.
- Cash income taxes in the range of $75 million to $95 million.
- Restructuring cash of approximately $20 million.