DOW JONES NEWSWIRES ArvinMeritor Inc.'s (ARM) fiscal third-quarter loss narrowed as the auto-parts maker's sales jumped along with the auto industry's recovery, and margins improved. The bottom line results, however, missed analysts' expectations and the company forecast fourth-quarter sales to be "slightly lower" than the third quarter's $1.28 billion due to seasonal customer shutdowns. Analysts polled by Thomson Reuters recently projected $1.16 billion. Shares fell 2% to $16.47 in light premarket trading. As of Monday's close, the stock is up 50% this year. ArvinMeritor has reported improved results in recent quarters as trends in the American and European auto sectors improve. The company has earned an upgrade out of highly speculative territory from all three ratings agencies this year, with Standard & Poor's Ratings Services saying the company's restructuring efforts last year laid the foundation for greater profitability. For the quarter ended June 30, the commercial- and light-vehicle maker posted a loss of $3 million, or 3 cents a share, compared with a year-earlier loss of $164 million, or $2.26 a share. The company reported a 1-cent profit from continuing operations, compared with a year-earlier loss of 47 cents. Analysts expected a profit of 6 cents. Sales climbed 35% to $1.28 billion, beating the company's upbeat May projection of $1.21 billion. Gross margin improved to 11.4% from 7.3%. Sales increased 76% at its commercial-vehicle systems business, its largest, and rose in all three of ArvinMeritor's other business lines. Chairman and Chief Executive Chip McClure said the company was optimistic about the positive volume trends it saw in Europe and North America, with the exception of military products. McClure added there was continued market strength in South America, China and India--particularly as the company moves to expand its business in those regions. The company reiterated its goal to complete the sale of its light-vehicle systems business by the end of the year. As the financial performance of that unit has improved, ArvinMeritor said it no longer expects the sale to have a material effect on the company's cash flows at the time of closing. -By John Kell, Dow Jones Newswires; 212-416-2480; john.kell@dowjones.com
