…Third Quarter 2019 Financial Webcast and Conference Call. My name is Carmen and I will be your conference facilitator today. Please be advised that our meeting today, both the speakers' remarks and Q&A session, will be recorded for replay purposes. There will be a question-and-answer period after the speakers' remarks and we will take questions from the telephone only. [Operator Instructions] At this time, I would like to begin the presentation by turning today’s call over to Dana's Director of Investor Relations and Strategic Planning, Craig Barber. Please go ahead, Mr. Barber.

Thank you, Carmen, and good morning, everyone. Thank you for joining us today for our 2019 third quarter earnings call. You'll find this morning's press release and presentation are now posted on our investor website. Today's call is being recorded and supporting materials are the property of Dana, Incorporated. They may not be recorded, copied, or rebroadcast without our written consent. Today's presentation includes forward-looking statements about our expectations for Dana's future performance. Actual results could differ from those suggested by our comments today. Additional information about the factors that could affect future results are summarized in our Safe Harbor statement and found in our public filings, including our reports with the SEC. Presenting this morning are Jim Kamsickas, President and Chief Executive Officer; and Jonathan Collins, Executive Vice President and Chief Financial Officer. Now it's my pleasure to turn the call over to Jim.

Good morning and thank you for joining us. I'm pleased to report that Dana achieved record third quarter sales of $2.2 billion, resulting in our 12th consecutive quarter of year-over-year sales growth. This continued growth was not achieved by accident, but instead by providing exceptional customer satisfaction, which has led to very strong organic growth plus accretive inorganic growth resulting in a very disciplined and highly effective M&A strategy. Our adjusted EBITDA for the quarter was $250 million, $10 million higher than the third quarter of 2018, resulting in an 11.6% margin. Our diluted EPS was $0.74. We have several highlights this quarter, and I will briefly cover them before turning the call over to Jonathan. We saw our overall sales and profits grow yet again. This was only possible because our team continued to perform very well launching our strong, organic backlog while on the organic side successfully -- inorganic side integrating the Oerlikon Drive Systems business. In our heavy vehicle markets, we experienced high level end market demand volatility in construction and agricultural equipment end markets, as well as a significant drop in demand in India and China, which especially impacted our higher profit margin off-highway business. In addition, we were impacted by the General Motors' autoworkers labor strike, primarily in our light vehicle segment but also in our commercial vehicle and power technologies groups. We are navigating through the volatility, largely a result of our flexible manufacturing, selected vertical integration and our balanced end market exposure. We also accelerated the flexing of our cost structure thus largely offsetting the impact of market volatility and bolstering our strong free cash flow. I will share some additional color around this in just a few minutes. In addition, we announced the acquisition on Nordresa Motors, a recognized leader in the…

Thank you, Jim. Good morning everyone. Slide 11 is an overview of our third quarter results compared with the same period last year. Third quarter sales were $2.16 billion, an increase of $186 million compared to the same period last year or 9% growth driven by the conversion of our backlog and the accretive acquisition in our Off-Highway segment. Adjusted EBITDA for the quarter was $250 million, a $10 million increase from the prior year or 4% growth for a profit margin of 11.6%. The primary margin headwind this quarter was unfavorable segment mix, which I'll cover in detail in a moment. Net income was $111 million, an increase of $16 million over 2018 or 17% growth, which is largely attributable to favorable income taxes due to the release of valuation allowances in Brazil as market prospects in that country have improved. Diluted adjusted EPS, which excludes the impact of nonrecurring items was $0.74, slightly lower than last year as higher adjusted EBITDA was offset by higher depreciation and interest expenses. Adjusted free cash flow was $125 million, $91 million higher than last year for a 6% margin. The growth is primarily attributable to lower cash taxes and working capital requirements. Please turn with me now to slide 12 for a closer look at the sales and profit growth in the third quarter. The growth in third quarter sales and adjusted EBITDA compared to last year is driven by four key factors. First, organic growth added $27 million in sales, primarily driven by continued conversion of our strong backlog, which was partially offset by lower market demand, principally in our heavy vehicle businesses. The unfavorable mix generated by lower off-highway sales in the high margin construction markets that Jim discussed a few months ago generated an $11 million profit headwind…

[Operator Instructions] Your first question comes from the line of Aileen Smith with Bank of America.

Good morning. First question to follow-up on Slide 18 of the deck. I appreciate you're not giving explicit estimates or targets at this point. But if we think about the margin target that you've had out there for a few years 12.7%, when you referenced that in the past was it based on any particular assumption for segment mix between your end markets? And has this changed substantially in any way given some of the volatility that we've seen over the past few months?

Sure. It certainly did not contemplate the level of softness that we're seeing in the Off-Highway markets in the second half of this year. So given we're going to be just under 12% this year, that target is not going to be in reach for next year. I would say it's primarily due to the overall volume decline in the heavy vehicle segments. However, as I mentioned on the slide, we do believe that there's margin expansion next year due to the cost synergies as well as the opportunity for commodity cost to continue to subside. But that's basically our perspective on the margins for next year.

Great. That's helpful. And then focusing in on Slide 22 and Off-Highway, the conversion on organic growth in the quarter was almost 100%, if I'm reading that chart correctly. Was this type of flow-through just attributable to the velocity with which end markets deteriorated in the quarter? Or is there anything notable from a cost perspective that was more one-off in nature?

Yeah. In that walk, I think it's about $10 million on $14 million. So it's a much higher contribution margin than you would typically see. It's principally two factors. The first is the one that you mentioned. Within our off-highway segments, we saw very rapid decline. And when we start to pull the levers to flex cost as Jim mentioned, there's a little bit of a period of time that it takes for those to take effect. So we do expect for the impact to be lessened significantly in the fourth quarter. The other factor is a little bit of inter-segment mix. Even within the off-highway segment, construction from a profitability perspective is very high. And some of what helped offset that decline is backlog coming online at slightly softer margins. So when you think about new backlog, at little lower margins, construction falling at higher margins, you get a little bit of a, inter-segment mix which puts a little pressure on that. But I think the principal comment is that's something, that's going to be pretty unique to the third quarter. As we move forward, we would expect the year-over-year declines to have a lower conversion than what we saw in Q3.

And your next question is from the line of Brian Johnson with Barclays.

Yes. A couple of a little bit more strategic questions, so, with the Valeo deal -- they're obviously very strong in 48-volt. But, what do you -- they haven't been as active in hybrids and B2s and B4s. So, what are they bringing to the table that you didn't have before? Will it involve their, Siemens joint venture as well? And just where do you see that going? And given your point on reviews that I see across vehicle on-highway, off-highway commercial light vehicle segments, how does that fit and given their light vehicle focus?

Good morning, Brian. This is Jim. Thanks for the questions. I appreciate it. Let me kind of dimension it for the entire audience, how we're thinking about it. Even back to the beginning of the scripting of our enterprise strategy in late 2016, refreshed again earlier this year, we are not interested in focusing on the 48-volt in passenger car business just as Dana hasn't been for decades and we're not now. What this is a relationship. And essentially let's keep it simple, in the gearbox mechanical piece only in that market. We're going to have the Valeos and the participants in those areas continue to compete. But we're going to be a partner with Valeo relative to gearboxes only. Your question specifically getting up into trucks and larger vehicles, it's not applicable. That's what we've completed. Our full suite of products, are full electrodynamic products as well as integration systems et cetera et cetera. That's where we'll continue to basically manage the business like we have for years.

Okay. So are you saying that, what you're doing with Valeo will go into 48-volt systems Valeo is offering not into their higher voltage efforts, they're pursuing with another joint venture?

That's correct. That's exactly right.

Okay. And second question is around just the free cash flow conversion. And I think a couple of things. One any changes contemplated with capital allocation in terms of returning cash to shareholders? And second, and maybe before that, any update on CapEx because it has been -- it's obviously with your guidance continues to be up year-over-year. You got Toledo coming online, should have had some and obviously had an influence on the CapEx. So, again you're not giving 2020 guidance. But just you can give fade on the cadence to CapEx and what implies for capital allocation?

Sure. I'll take those in reverse order Brian. So relative to the CapEx, we did make a few decisions to incur a little more CapEx this year in 2019. So as you know that, we green lighted a few things a little bit of that. It turned out to be somewhat of a pull ahead from next year. So we continue to believe that as we move into next year, you will see CapEx trend down closer to 4%. That's going to be part of the free cash flow improvement on a year-over-year basis. And that does contemplate the growth in electrification that, Jim announced this morning, and some other areas where we'll continue to spend the majority of our CapEx on growing the business. Relative to the use of cash flow, nothing meaningful has changed from the outlook that we laid out earlier in the year. We'll take a balanced approach towards allocating that free cash flow. We have low-cost opportunities to continue to reduce our leverage. We're starting that this year, with the pay down on our Term Loan B. We'll generate enough cash flow next year to make a meaningful delevering in 2020, as well. So I think that's our general outlook for next year.

Your next question is from the line of Dan Levy with Credit Suisse.

Hi. Good morning. Thanks.

Good morning, Dan.

Good morning. Hi. I wanted to just continue to dig in on off-highway following up on Aileen's question. So, first of all, if you could just a give us an update in terms of the lead time of how quickly you are getting visibility or updates on this and then just, in terms of the margins, if I go back to sort of the Dana's story of call it 2015, 2016. We actually saw your off-highway margins hold up pretty well despite pretty horrific end markets. So what does that tell us about the Off-Highway margins now, especially as you've added Oerlikon and Brevini? And does this slide that you put out on cost structure flexibility is that largely in line for all the segments? Or does it vary segment by segment?

Sure. So I'll take the first part touching on the Off-Highway outlook and visibility. As we've indicated before in this segment, we usually get a production calendar that's a couple of months out. What's unique about the Off-Highway space, certainly compared to the light-vehicle segment and even operates differently than commercial vehicles is the rate at which that can change. So orders can move in the order book within a narrow period of time. And that's what we saw happen in the third quarter. So it's that rapid change where production schedules in the very near term drop pretty significantly in a number of regions around the world. So it is more volatile in the short-term from that perspective. Relative to the long-term margin outlook for the Off-Highway segment, this is something that we've shown to as a proof point that that say we can manage through the cycle. Nothing has fundamentally changed in that business. What I would highlight is that there's a significant difference between the near-term flexing and what we can do once we get a few months out. So what we really saw in the third quarter of this year was just the short-term impact. Now that we've taken the actions to take labor out of our operations and flex a lot of that cost structure that Jim highlighted, we would expect to see a much better flex on the lower volumes in the fourth quarter and moving into next year? And just on your last point relative to the cost structure side that Jim walked everyone through, I just want to highlight, that is relatively comparable. As you look across our businesses, obviously that 12% profit margin is blended. But generally speaking, the engineering spend portion, the SG&A portion and the composition of cost of goods sold, those proportions are comparable as you move across all of our business segments.

Great. Thank you. That's helpful. And then just a follow-up on capital allocation. Your stock price was obviously depressed in the third quarter. And I realize the cash priority is really more to focus on the balance sheet right now to deleverage and also to fund your future growth endeavors. But I guess, wondering why you wouldn't have been somewhat opportunistic in the third quarter in terms of buying back some stocks given the depressed levels? It looks like you didn't buy back stock. So I was just wondering how you're looking at stock buybacks in the capital allocation framework amid some of the movement in the stock price?

Sure. Fair question. We have an existing authorization with plenty of capacity. It's something that we continue to evaluate. At this point, we've made the judgment that the near-term priority for us given where we are in the cycle is just to continue to bolster and strengthen the balance sheet. So we decided to initiate the delivering even though we have a lot of conviction that the stock price is lower. We think that over time as we continue to strengthen the balance sheet and differentiate ourselves there, it should help in the long run with providing an appreciation in the value of the business.

Great. Thank you.

Sure.

Your next question is from the line of Joseph Spak with RBC Capital Markets.

Thanks. Good morning, everyone.

Good morning.

I guess, first just wanted to start. I was focusing on the Off-Highway bridge. I actually want to move over to Power Technologies for a second. I know the bridge is shown year-over-year. But if you look at it more sequentially, sales were 5% lower but the EBITDA was flat. So it actually seems like there could be some evidence of improvement. And I know this is a segment that's gotten some attention in the past couple of quarters. So I just wanted to better understand what you're seeing in that business.

Sure. Good morning, Joe, it's Jonathan. As you remember at the end of the second quarter last year, Jim highlighted that this is a segment that we were not particularly concerned about and that we would continue to see improvement there. You'll remember the things that are really putting pressure on this segment were product mix. Geographically, we saw some pressure outside of the U.S., which is really important for that segment. We also had some self-help issues. We had some premium cost on launches. And then the third is commodity. While the end market outlook hasn't changed meaningfully, it's really those self-help categories that we continue to see driving the improvements from the second to the third quarter and we expect to continue to see upward movement here. Launches the big ones that we mentioned last time are behind us. Costs are contained there. And then we've also started to see some progress on commodities, alleviating a bit but also working with customers to improve recovery. And the combination of those are really driving that sequential improvement.

Okay. I'm sorry, if I missed this, but did you see any impact from the GM strike in either this segment or in LVD?

Yes. A little bit in both of those segments. As Jim mentioned in his comments, the Colorado Canyon, we produce here in North America was the largest impact that we saw in the quarter.

Okay. And then just going back to the Valeo agreement. To Brian's question, I guess, I want to better understand. Like you've taken on most other initiatives a more integrated approach with the motor. Was this -- is this just -- like on 48-volt an area you didn't invest in as much as this is sort of just an opportunity you see and that's why you sort of decided to partner there? And is there any exclusivity? And also like I don't think this was in your backlog and I believe the release said it starts in late 2020. So can you help us understand the opportunity you see here?

Yes. Thanks for the question. This is Jim. I think, you used the right word, the perfect word. It is just opportunity. We don't define this as core. In fact, we argue it is to a degree non-core. But it also comes back to exactly what Dana has built itself upon which is the gearing aspect of it. And there will be some -- they'll be sophisticated gearings certainly to support e-Propulsion in the 48-volt range and that's what we'll participate. So coming back to our enterprise strategy we always said that it's non-core, but we would capitalize on opportunities. Again, we have a good relationship with Valeo. We both obviously meet with the same customers and the customers are asking us to support. So it's kind of a win-win. But our major focus will continue to be on the SUV light truck large truck off-highway and everything as such.

Your next question is from the line of James Picariello with KeyBanc.

Hey, good morning, guys.

Good morning.

Just going back to Off-Highway, if -- for the quarter, if we exclude ODS contribution and FX your Off-Highway course sales were only down 3% call it $12 million. And so I mean you said ODS is now on track to be down $100 million for the full year versus prior expectation. I could get to an implied year-over-year decline in the low double-digits for ODS. So what's driving the more notable weakness for that business relative to your legacy Off-Highway mix?

Yes. It's just a function of where their sales are concentrated. So if you think about the past Off-Highway business larger segments construction followed by ag and then followed by mining and material handling. And within the Off-Highway segments that we support in ODS you see a heavier concentration in the construction segment and also a more meaningful presence in the India market. So Jim highlighted earlier in the call that from a geographic standpoint India saw very soft sales in the third quarter. We see it moving into the fourth quarter. And we highlighted when we made the acquisition it came with a very strong footprint in India and a meaningful portion of that supporting the local market. So those are a couple of the drivers as to why we're seeing a softer impact within the ODS business versus the rest of the Off-Highway segment.

Would you be willing to share what India represents as a total sales mix?

Yes. For overall Dana, it's still in the mid-single digits but certainly higher when you look at the Off-Highway segment and even higher -- just ODS again.

Just ODS. I'm sorry I meant for ODS.

Yes. It's a meaningful portion. I don't have the exact number at my fingertips…;

Okay.

But it is a meaningful piece of that business.

Got it. And then I think you made the comment that ODS cost-out synergies are running 2x. What your original expectation was which I think is -- was $10 million. So is -- that would imply another $20 million next year to get to the original target of $40 million. Can we assume some upside into next year regarding that number based on accelerated progress to-date? There are clear market challenges for ODS so maybe you have an additional opportunity to take out costs in the interim. So just any color there.

Yes. We'll continue to attract that $40 million on an apples-to-apples basis. So the typical cost flex we will have to do because of volumes being lower really won't be reflected in that number. But overall, I think, that number is still pretty good at about $40 million. There will be a little bit of pull ahead. But from a year-over-year impact it'll probably be pretty close to what we indicated last time keeping in mind that what we were really able to accelerate from a cost standpoint or the structural cost actions. And then a lot of the work that we'll be doing on the material cost will continue on the normal cadence as we were expecting. That stuff takes a little bit of time. But certainly the levers that we had to pull that were completely in our control, we've pulled and we're really pleased with what the team has done there.

Got it. Okay. And then if I then just can ask one more on -- I'll just keep it tied to ODS. For free cash flow can you just quantify what the onetime costs are this year so we could easily back that out when thinking about next year?

Yes. Maybe a better way to do it is I would expect onetime costs for next year to be half of what they are this year and the majority of that change is going to be driven by ODS.

Your next question is from the line of Rod Lache with Wolfe Research.

Great. Thank you for the question. So just going back to slide 22, you addressed the decrementals on Off-Highway talking about how that's due to the intersegment mix and the velocity of the decline. Can you just maybe talk a little bit about when you would expect the decrementals to normalize to the -- and maybe closer to 30% range? And what specific actions are coming into play now to normalize that? And similar question on the Power Tech segment?

Sure. So the short answer is we would expect to see a relatively normal conversion in the fourth quarter. So some of the things as Jim was walking through that cost structure side that we highlighted on the left-hand side, certainly the material cost component we're addressing. It's really on the conversion cost that takes a little bit of time. A lot of our manufacturing for this segment is in Europe. And while we have tools to flex that labor it's not something that we can do immediately. That burn-in period usually is weeks to a couple of months and we've initiated all of that activity in the third quarter. So I would expect to see a more normal conversion on the year-over-year change in the sales for the Off-Highway segment even in the fourth quarter. And that's why we think that margins for the fourth quarter can be comparable with Q3 even on lower sales. I think to your point Rod on the Power Tech segment, I think we've continued to see the team pull cost levers there and we should see some modest continued improvement in the margin profile of that business as we move into next year.

Okay. Great. Thanks. And could you maybe give us a sense of the magnitude of the production changes that you're starting to look at off-highway and maybe also for commercial vehicle just given the unique exposures that you have there?

Sure. And maybe the best way to dimension it when we gave of our guidance earlier this year, we thought that the declines in -- principally in those markets from this year to next was going to be a couple of hundred million dollars. Right now, what we see is that it's going to be higher than that. So we would expect more of a decline. However, what I indicated in my comments in our outlook for next year is that our backlog for next year is expected to be higher than what we originally thought earlier this year as well. Certainly, the new electrification win that Jim mentioned this morning is a big driver of the higher backlog. But also we took a pretty conservative perspective on a couple of a key compact truck vehicles that were coming online next year. Now that we've got a couple of those in production already and we have good line of sight into next year, the volumes on those programs are going to be stronger than what we conservatively expected. So on balance, even with a sharper decline in the heavy vehicle segments than what we expected earlier this year, we do believe organically we still see a path to the business being about flat 2019 to 2020.

Great. Thanks. And just lastly on these new awards that are coming in, it sounds like they're coming in in a relatively short time frame, which is truly impressive to see how you guys are doing there. And it obviously becomes meaningful to growth relatively soon. How should we be thinking about the incremental margins on backlog as you start to transition? Is it very different manufacturing than what you guys have done in the past? Is there some kind of a -- like a grow in period while these are still relatively mature products?

Sure. We continue to believe that there is margin expansion potential as we move from purely mechanical systems to software control mechatronic systems. We'll be conservative and thoughtful as we roll on the backlog and what we incorporate in our guidance. But certainly having more systems responsibility and having smart systems become a bigger piece of the equation, we believe drives long-term margin expansion potential. And that should give you a general sense on the financial side.

And just to add some color, good morning Rod I'd add on the manufacturing question you added there which is -- it's the beauty of being able to get the assets, while they are still in the market the companies we bought they are actually been in high volume. Motor manufacturing, inverter manufacturing so with them come a lot of folks. So I think you should recall when we first met I was with Lear I have a lot of experience on that electrification side as well albeit wiring and PCB boards and all that stuff. I think we're in pretty good shape there, but we also don't underestimate that or minimize that as we all come up the curve in a much higher volume environment and these type of electrodynamic products that we're going to -- we have to be ready for it. So that's a major focus of ours.

Your next question is from the line of Ryan Brinkman with JPMorgan.

Hi. Thanks for taking my question, which is relative to the 2020 outlook slide. I know you're looking for company-specific factors backlog and acquisition and to roughly more than offset the end market headwinds to revenue. Can you please elaborate on that second point about the potential for margin expansion? What contribution margin are you assuming from the backlog revenue? And would it will be really be the decremental to softer volume from industry headwinds will be higher than the incremental on the backlog revenue? So when you consider that, what does that imply about the magnitude of the tailwind that you're expecting from lower cost in commodities? And how would you rate your visibility into those savings?

Sure. So maybe I'll just touch on the organic mix first. The piece that's related to the market is principally made up of the heavy vehicle segments. We're going to see a meaningful decline in the Class 8 market in North America where you would expect the downward contribution margin to be less than 20%. We've highlighted before that at mid-cycle, the heavy vehicle segment represents only about one-third of the commercial vehicle segment and it is the least profitable in that area. So it helps out a little bit there. However, the other part of the organic decline that's related to market is on the off-highway segment, where we would expect it to be above 20%. So I would say on balance, on a blend, you're going to see around 20% is what I would expect for the market declines. The backlog will come online at a comparable margin, which is why we still believe similar to what we indicated at the beginning of this year when we laid out an outlook for next year is that relatively flat top line organically and the negligible impact on the bottom line there. I think what we wanted to highlight with the organic or the inorganic cost synergies in the lower commodity cost is that both of those have trended better than we expected in 2019, which just increases our confidence that those will be meaningful tailwinds moving into next year. So the impact of those is not meaningfully different than what we indicated earlier this year. I would just say our confidence in those providing a little bit of margin tailwind remains intact. I would say that's basically how things have changed since our outlook from earlier this year.

Okay. That's very helpful. Thanks. And just a follow-up on Nordresa. How should we think about the progression of the $200 million in backlog over the next several years? And understanding this is a development phase company, but what would be the rough impact on the financials near term on revenue and EBIT? Or does it replace any of what would have been internally generated R&D, anything to think about there?

Yeah. Just on the top line, the impact in next year will be pretty small. So the program launches towards the end of next year. You'll see a full -- first full year of sales in 2021. And then the program will really hit its stride from a volume perspective in 2022. So it will be -- most of the $200 million will be fully reflected in the backlog that we introduced next year. Some of that will fall outside that three-year period into 2023. But most of it, you'll see in our three-year backlog number, it's all incremental. So this is entirely new content on the program that we were awarded. And from an engineering spend perspective, we remain convicted based on what we see now that engineering spend is still going to be about 3% of sales moving into next year. I'll just highlight, as Jim mentioned in his comments, that's a lever that we will look at carefully. We discuss with all of our customers on any program, the level of engineering investment that we can make and what we'll look for subsidies on. So, I would say that's nothing meaningfully has changed in our outlook there.

And your final question will come from the line of Emmanuel Rosner with Deutsche Bank.

Good morning.

Good morning.

Good morning, Emmanuel.

Apologies, I joined the call a little bit late. On the off-highway outlook specifically, can you talk a little bit about how what you've seen in the third quarter, and then expect to the fourth quarter? How do you expect that to translate into early trends in 2020?

Yeah. Yeah fair. So, we saw a meaningful step down in production levels, particularly in the construction segment, a little less felt in agriculture and mining compared to the first half of the year. We would expect the run rate to be comparable to what we're seeing the third quarter, in the fourth quarter, although obviously we're going to see some production downtime in the November and December more so than what we would see in Q3. But, on a run rate basis pretty comparable. We think we'll move into next year a little bit softer. And then, we would probably have a full year outlook that would imply slightly higher volume outlook from a run rate standpoint towards the end of next year. So the high level gives you a sense of the cycle within off-highway.

Okay. That's helpful. And then still on 2020, just wanted to double check some numbers that I think were said in the prepared remarks. I think you spoke about $100 million of additional revenue growth from getting a full year of the recent acquisition. Could you also quantify the updated backlog for 2020?

No, I didn't. I just indicated that next year -- when we gave the original guidance for next year, we thought that markets would be down about $200 million in the backlog would cover that. What we're saying is we think the market decline will be more than $200 million now. I didn't give that number. We'll refine that over the next 60 to 90 days. But that, based on line of sight that we had into our backlog, we will be able to offset that. Some of the things I pointed to, Emmanuel were stronger volumes in the electrified area compared to what we had in our backlog. We had a limited amount of electrified sales in our backlog. And with the exciting announcements that Jim shared earlier, it's certainly going to put some wind at our backs there. And then in addition to that, we were a bit conservative on some of the volumes on the compact truck segment that are in our backlog. And now that some of those programs launched partway through this year and we have a sense of what the volumes are and we have a better sense of program volumes for next year, we think that we'll get a benefit there. So, right now we think those two will offset, but we won't be giving the revised three-year backlog until we give you our Q4 results early next year.

Great. Thank you very much.

Okay. Well, thanks every -- sorry, go ahead.

I was going to turn it back over to management for closing remarks.

Okay. Thank you, Amy. Just in closing, this is Jim again. Thank you all very much for your interest in Dana and for taking the time with us today. Just a quick recap. Hopefully, the take away from today's call, it's the 12th conservative quarter of year-over-year profitable growth very proud of our entire team for doing that. We did that, at the same time, while acquiring very strategic important e-Powertrain assets, which led us to today to be updating you relative to a significant award across the business. I would say this. From my standpoint, interesting after the enterprise strategy that we rolled out in Q1 this year is kind of an update for you. We received very, very fair feedback from many of you about potentially over-saturating the audience with our electrification plan and the things that we are working on, and we appreciate that feedback. But I'd also say at this point in time, we're very happy that we think we got it right. We think we got it right relative to if you look at the megatrends, you look at the markets and you look at the activities that we've taken to make sure we secure the assets while they were still available. It's parlaying into what we're trying to accomplish at Dana and we're going to move forward from here. So, thank you for all your support and attention, and we look forward to talking to you very soon.

Thank you for joining today's conference call. You may now disconnect.