Tenneco has announced results for the fourth quarter and full year ended Dec. 31, 2020, including the following: 

• Fourth quarter 2020 revenue of $4.7 billion was up 12% year-over-year. Value-add revenue for the fourth quarter 2020 was $3.6 billion, or 4% higher versus last year, excluding currency impact of $76 million. 
• The company reported net income for the fourth quarter 2020 of $167 million, or $2.03 per diluted share, and adjusted net income for the fourth quarter 2020 of $138 million, or $1.68 per diluted share. 
• Fourth quarter 2020 EBIT* improved by $404 million to $260 million, versus a loss of $144 million in the prior year, and EBIT as a percent of revenue increased 910 basis points to 5.6% versus -3.5% in the prior year. 
• Fourth quarter adjusted EBITDA was $410 million, up $123 million versus prior year. Adjusted EBITDA as a percent of value-add revenue was 11.5%, a 300 basis point increase year-over-year. The Accelerate+ program drove improved operating performance, and is on or ahead of schedule. 
• Cash generated from operations of $474 million in the fourth quarter 2020 was primarily driven by strong earnings and effective working capital management.
• Strong operational performance helped Tenneco generate significant cash flow and year-over-year debt reduction

“Strong operational performance in the quarter helped Tenneco generate significant cash flow and year-over-year debt reduction,” said Brian Kesseler, Tenneco’s CEO. “Our Accelerate+ program continues to drive margin expansion and is on track to achieve $265 million in annual run rate savings by the end of 2021, and we achieved our working capital efficiency improvement target of $250 million a year ahead of schedule. We are proud of the resilience and commitment of the global Tenneco team as they continue to overcome the challenges of a volatile operating environment.” 

Net Debt and Liquidity
Tenneco’s fourth quarter 2020 performance resulted in significant improvements to the company’s debt net of total cash balances and liquidity position. At 2020 year-end, total debt was $5.3 billion and net debt was $4.5 billion, a reduction of $460 million in net debt compared with 2019 year end.  Total liquidity was $2.3 billion at year end, consisting of $0.8 billion of cash balances and $1.5 billion of available revolving credit facility, up from total liquidity of $1.8 billion at the end of the third quarter 2020. 

Full-Year Results
The global COVID-19 pandemic and its effect on the economy and industry volumes had a negative impact on the company’s full year revenue and earnings, particularly in the first half of 2020.  Full year 2020 total revenue was $15.4 billion versus $17.5 billion in the prior year. Full-year 2020 EBIT was a loss of $724 million, which includes $933 million from non-cash charges, primarily due to COVID related impairment charges, versus earnings of $121 million a year ago, and adjusted EBITDA was $1,045 million versus $1,415 million a year ago.  The company’s performance in the second half of 2020 delivered significant year-over-year improvements in both margin and free cash flow generation.

“We continue to build positive performance momentum off our strong second half of 2020,” added Kesseler. “Our focus on reducing structural costs, expanding margins, and lowering our capital intensity allowed us to reduce our net debt position by nearly $500 million in 2020. The Tenneco team’s relentless commitment to disciplined execution is expected to deliver continuing performance improvements in 2021. We expect this continued focus on cost and cash management to enable significant near-term value creation potential, and at the same time, support investments in our core growth platforms to deliver long-term value to our customers and shareholders.”