Tenneco Profit Up 50% on Stronger Aftermarket Position

Tenneco Automotive Inc. has reported a 50% jump in third quarter profit, largely on the basis of a stronger position in the North American aftermarket and favourable exchange rates.
In the face of this the auto parts maker still maintained a cautious outlook for the fourth quarter and into 2005.
Lake Forest, Ill., based Tenneco had net income of $6 million, or 14 cents a share, for the latest quarter, up from $4 million, or 10 cents a share, a year earlier. All figures in U.S. dollars.
Excluding restructuring charges and a tax benefit, third-quarter earnings came to $7 million, or 16 cents a share, beating the Thomson First Call analysts’ average estimate of 10 cents a share.
Revenue rose 9.2% in the quarter to $998 million from $914 million a year ago, including a $33 million boost from favourable currency exchange rates.
Shares of Tenneco climbed 73 cents, or 6.6%, to close at $11.85 on the New York Stock Exchange.
Tenneco said it is negotiating 2005 steel contracts and is pursuing material substitutions and other measures to save money.
It also is looking at lowering its cost structure through consolidations, shared services and more aggressive discretionary spending targets, it said. It did not identify specific financial targets.
The company is expected to earn 19 cents a share for the fourth quarter, $1.15 for 2004 and $1.29 for 2005, according to analysts polled by Thomson First Call.