Dana (DAN) Investor update summary

Strategic achievements and portfolio transformation

• Completed sale of Off-Highway business for $2.7 billion, netting $2.4 billion after costs and debt, streamlining operations and focusing on core on-highway markets.

• Achieved cost reduction target of $250 million in 2025, with a cumulative target raised to $325 million by 2026.

• Integrated Power Technologies into core segments and completed the buyout of the TM4 joint venture for under $200 million.

• Returned over $700 million to shareholders in 2025 through buybacks and dividends, with $200–$300 million in repurchases planned for 2026 and a $1 billion capital return plan.

• Paid down nearly $2 billion in debt, resulting in a strong balance sheet with low leverage and no near-term maturities.

Financial performance and guidance

• 2025 revenue reached $7.5 billion with adjusted EBITDA of $600 million (8% margin) and free cash flow of $315 million.

• 2026 guidance projects sales of $7.5 billion, adjusted EBITDA of $800 million (10.5% margin), and free cash flow of $300 million.

• Margin expansion is driven by cost savings, elimination of stranded costs, accretive new business, and improved plant performance.

• CapEx for 2026 is expected at around 4% of sales, with working capital improvements anticipated.

• Achieved high end of 2025 guidance ranges for sales, EBITDA, and free cash flow.

Market outlook and backlog

• Three-year backlog increased to $750 million, with $200 million of growth expected in 2026, primarily from light trucks.

• Backlog growth offsets a slightly down market, with new programs and added content on key platforms like Ford Super Duty and Jeep Wrangler.

• Commercial vehicle share gains are driven by investments in low-cost manufacturing and expansion into new platforms and regions.

• Aftermarket business, now a strategic focus, is expected to grow in 2026 and beyond, leveraging strong brands and new contracts.

• Conservative market assumptions for 2026 may provide upside if conditions improve, especially in North America heavy duty.