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Tenneco Reports Second Quarter 2022 Results

Company reiterates intent to complete pending transaction with Apollo Funds in the second half of 2022.

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Tenneco has announced results for the second quarter ended June 30, 2022. 

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Second Quarter 2022 results include: 

• Second quarter total revenue of $4.7 billion, up 2% year-over-year. Value-add revenue of $3.5 billion was up 6% year-over-year excluding a negative currency impact of $174 million and outperformed global industry light vehicle production, which was flat year-over-year*. Cost recoveries contributed more than $200 million of revenue on a year-over-year basis.

• EBIT** of $15 million, compared with EBIT of $127 million in second quarter 2021. Adjusted EBITDA*** was $212 million, compared with $356 million a year ago. The year-over-year decrease was primarily driven by timing of recoveries on higher inflationary costs for material, freight and energy as well as the profit mix from lower overall volumes in China.

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• Net loss of $121 million, or a loss of $1.44 per diluted share, compared to a net loss of $10 million, or a loss of $0.12per diluted share, in the prior year. Second quarter 2022 adjusted net loss of $69 million, or a loss of $0.82 per diluted share, compared to prior year adjusted net income of $69 million, or $0.84 per diluted share.

• As of June 30, 2022, the company had no outstanding borrowings on its $1.5 billion revolving credit facility.

“Lower volumes, inconsistent production schedules, and inflationary cost pressures created a challenging business environment in the second quarter,” said Brian Kesseler, Tenneco CEO. “The team’s solid progress on inflationary cost recovery coupled with other operational cost and cash optimization actions set the business up well to capitalize on S&P Global Mobility forecasts for improving light vehicle production in the second half of the year and entering 2023.”

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In light of the pending transaction with Apollo Funds, Tenneco says it will not conduct a conference call or give forward-looking guidance. The company expects to complete the transaction in the second half of 2022, and continues to make progress obtaining necessary approval. All conditions to closing under the merger agreement with respect to antitrust and/or foreign direct investment laws have been satisfied or waived except for the European Union and Japan.

During the quarter, the company released its latest Sustainability Report covering operations in 2021 and highlighting the company’s continued achievements and progress toward long-term sustainability goals. The report was prepared in accordance with the Global Reporting Initiative (GRI) Standards and covers metrics within the Sustainability Accounting Standards Board (SASB) Auto Parts Industry Standards.

*     Source: S&P Global Mobility (formerly IHS Markit) July 2022 global light vehicle production forecast.
**   EBIT: Earnings before interest expense, income taxes and noncontrolling interests.
*** Adjusted EBITDA: Adjusted earnings before interest expense, income taxes, noncontrolling interests, and depreciation and amortization.

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