Tenneco (NYSE: TEN) reported Q4 EPS of $1.68, $0.67 better than the analyst estimate of $1.01. Revenue for the quarter came in at $4.65 billion versus the consensus estimate of $4.3 billion.

• 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 chief executive officer. "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," added Kesseler.

"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."

GUIDANCE:

Tenneco sees Q1 2021 revenue of $4.45-4.55 billion, versus the consensus of $4.28 billion.

Tenneco sees FY2021 revenue of $17.2-17.8 billion, versus the consensus of $17.14 billion.

For earnings history and earnings-related data on Tenneco (TEN) click here.