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Meritor Inc. said its quarterly net profit nearly doubled and revenue grew about 11%, and cited a truck market up in several regions from a year earlier.
For the first quarter of fiscal 2022, ended Dec. 31, Meritor reported net income of $58 million, or 76 cents per diluted share, compared with $33 million, 44 cents, in the prior period. This was primarily due to lower interest charges and higher sales volumes, partially offset by net steel costs, according to the Troy, Michigan-based company.
Revenue reached $984 million, up $95 million from $889 million a year earlier. The increase is primarily attributable to increased truck production in most global markets.
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“Overall, we are pleased with our financial performance and have started the year well,” Meritor CEO Chris Villavarayan said on the latest earnings call. “We are working closely with our customers and suppliers to offset historically high transportation and material costs while managing supply chain constraints and a prolonged labor shortage.”
Revenue from its commercial truck segment jumped to $785 million, 14%, or $94 million, up from the same period of 2020. The increase was primarily due to increased truck production in the most world markets.
“In the North American Class 8 market, the order backlog is estimated at approximately 260,000 trucks representing nearly a full year of industrial production,” said Carl Anderson, Meritor’s chief financial officer, on the call. results.
“As we closely monitor global supply chain constraints, we are beginning to see signs of stabilization. We expect supply chains to continue to improve as we move through of the year,” he added. “And I would say, definitely, as we see from the first to the second quarter, we see more stabilization. And it’s probably too early to declare a victory.
In North America, Meritor expects Class 8 production to be between 270,000 and 290,000 units, an increase of nearly 7% at the midpoint of 2021.
The Aftermarket and Industrial segment reported revenue of $241 million for the first quarter of the fiscal year, up $7 million, or 3%, from the same period a year ago. The increase is mainly due to pricing measures taken in the segment.
Separately, Meritor announced Feb. 2 an extension of its current Paccar agreement through 2025 to supply 14Xe powertrains and battery electric vehicle integration kits for Class 8 Kenworth T680E, Peterbilt 579EV tractors and trucks. 520EV garbage can.
As part of Meritor’s Blue Horizon advanced technology portfolio, the 14Xe ePowertrain is a fully integrated all-electric drive system and is the only production integrated electric powertrain for Class 8 trucks in North America, Meritor noted. .
Meritor is the leading supplier of commercial axles in North America, with a 70% share, Villavarayan said.
“So the electric powertrains are built on that scale,” he said. “We’ve been designing efficiency into axles for over a century. So we think this ability will help us.
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