DETROIT, July 31, 2020 /PRNewswire/ -- American Axle
& Manufacturing Holdings, Inc. (AAM), (NYSE: AXL) today
reported its financial results for the second quarter
2020.
Second Quarter 2020 Results
- Sales of $515.3 million
- Net loss attributable to AAM of $(213.2)
million, or (41.4)% of sales
- Adjusted EBITDA of $(52.1)
million, or (10.1)% of sales
- Diluted loss per share of $(1.88); Adjusted loss per share of $(1.79)
- AAM's second quarter financial results were unfavorably
impacted by global production shutdowns due to the coronavirus
pandemic (COVID-19)
"AAM's financial results for the second quarter of 2020 were
adversely impacted by the extended global production shutdowns
resulting from the COVID-19 pandemic. During the quarter, we
adjusted our operations, structurally reduced costs and took action
to strengthen our financial profile," said AAM's Chairman and Chief
Executive Officer, David C.
Dauch. "As we continue to ramp up production and
adjust our business to the new market demand in the second half of
2020, we are focused on the health and safety of our associates,
supporting customer production schedules and launches, utilizing
our operational excellence to generate positive financial
performance and investing in our future."
AAM's sales in the second quarter of 2020 were $515.3 million as compared to $1.7 billion in the second quarter of
2019. AAM estimates that our sales for the second quarter of
2020 were unfavorably impacted by COVID-19 by approximately
$947 million. In addition, our
second quarter of 2019 sales include $171
million related to our U.S. iron casting operations, which
were sold in December 2019.
AAM's net loss in the second quarter of 2020 was
$(213.2) million, or $(1.88) per
share, as compared to net income of $52.5 million, or $0.45 per share in the second quarter of
2019.
AAM defines Adjusted earnings (loss) per share to be diluted
earnings (loss) per share excluding the impact of restructuring and
acquisition-related costs, debt refinancing and redemption costs,
loss on sale of business, impairment charges and non-recurring
items, including the tax effect thereon. Adjusted loss per
share in the second quarter of 2020 was $(1.79) compared to Adjusted earnings per share
of $0.55 in the second quarter
of 2019.
AAM defines EBITDA to be earnings (loss) before interest
expense, income taxes, depreciation and amortization. Adjusted
EBITDA is defined as EBITDA excluding the impact of restructuring
and acquisition-related costs, debt refinancing and redemption
costs, loss on sale of business, impairment charges and
non-recurring items. In the second quarter of 2020,
Adjusted EBITDA was $(52.1) million, or (10.1)% of sales, as
compared to $266.0 million, or
15.6% of sales, in the second quarter of 2019. AAM
estimates that our pre-tax operating income and Adjusted EBITDA in
the second quarter of 2020 was unfavorably impacted by lower sales
as a result of COVID-19 by approximately $299 million. In addition, our second
quarter of 2019 Adjusted EBITDA includes $17
million related to our U.S. iron casting operations.
AAM's net cash used by operating activities for the
second quarter of 2020 was $(142.5) million. AAM
defines free cash flow to be net cash provided by (used in)
operating activities less capital expenditures net of proceeds from
the sale of property, plant and equipment. Adjusted free cash flow
is defined as free cash flow excluding the impact of cash payments
for restructuring and acquisition-related costs. AAM's Adjusted
free cash flow for the second quarter of 2020 was
$(161.8) million.
AAM's 2020 Financial Outlook
As a result of the
unexpected disruption in light vehicle production and economic
uncertainty due to the impact of the COVID-19 pandemic, AAM
withdrew its 2020 financial outlook on March
25, 2020. Due to the continued uncertainty, we are not
issuing revised 2020 financial targets at this time.
Second Quarter 2020 Conference Call Information
A
conference call to review AAM's second quarter 2020 results is
scheduled today at 10:00 a.m. ET.
Interested participants may listen to the live conference call by
logging onto AAM's investor web site at http://investor.aam.com or
calling (877) 883-0383 from the United
States or (412) 902-6506 from outside the United States with access code 6374523. A
replay will be available one hour after the call is complete until
August 7, 2020 by dialing (877)
344-7529 from the United States or
(412) 317-0088 from outside the United
States. When prompted, callers should enter replay access
code 10144277.
Non-GAAP Financial Information
In addition to the
results reported in accordance with accounting principles generally
accepted in the United States of
America (GAAP) included within this press release, AAM has
provided certain information, which includes non-GAAP financial
measures such as Adjusted EBITDA, Adjusted earnings per share and
Adjusted free cash flow. Such information is reconciled to its
closest GAAP measure in accordance with Securities and Exchange
Commission rules and is included in the attached supplemental
data.
Management believes that these non-GAAP financial measures are
useful to management, investors, and banking institutions in their
analysis of the Company's business and operating performance.
Management also uses this information for operational planning and
decision-making purposes.
Non-GAAP financial measures are not and should not be considered
a substitute for any GAAP measure. Additionally, non-GAAP financial
measures as presented by AAM may not be comparable to similarly
titled measures reported by other companies.
Company Description
AAM (NYSE: AXL) delivers POWER
that moves the world. As a leading global tier 1 automotive
supplier, AAM designs, engineers and manufactures driveline and
metal forming technologies that are making the next generation of
vehicles smarter, lighter, safer and more efficient. Headquartered
in Detroit, AAM has approximately
20,000 associates operating at nearly 80 facilities in 17 countries
to support our customers on global and regional platforms with a
focus on quality, operational excellence and technology
leadership. To learn more, visit aam.com.
Forward-Looking Statements
In this earnings
release, we make statements concerning our expectations, beliefs,
plans, objectives, goals, strategies, and future events or
performance. Such statements are "forward-looking" statements
within the meaning of the Private Securities Litigation Reform Act
of 1995 and relate to trends and events that may affect our future
financial position and operating results. The terms such as "will,"
"may," "could," "would," "plan," "believe," "expect," "anticipate,"
"intend," "project," "target," and similar words or expressions, as
well as statements in future tense, are intended to identify
forward-looking statements. Forward-looking statements should not
be read as a guarantee of future performance or results, and will
not necessarily be accurate indications of the times at, or by,
which such performance or results will be achieved. Forward-looking
statements are based on information available at the time those
statements are made and/or management's good faith belief as of
that time with respect to future events and are subject to risks
and may differ materially from those expressed in or suggested by
the forward-looking statements. Important factors that could cause
such differences include, but are not limited to: a significant
disruption in production, sales and/or supply as a result of public
health crises, including pandemic or epidemic illness such as Novel
Coronavirus (COVID-19); global economic conditions; reduced
purchases of our products by General Motors Company (GM), FCA US
LLC (FCA), Ford Motor Company (Ford) or other customers; our
ability to respond to changes in technology, increased competition
or pricing pressures; our ability to develop and produce new
products that reflect market demand; lower-than-anticipated market
acceptance of new or existing products; our ability to attract new
customers and programs for new products; reduced demand for our
customers' products (particularly light trucks and sport utility
vehicles (SUVs) produced by GM, FCA and Ford); risks inherent in
our global operations (including tariffs and the potential
consequences thereof to us, our suppliers, and our customers and
their suppliers, adverse changes in trade agreements, such as
USMCA, immigration policies, political stability, taxes and other
law changes, potential disruptions of production and supply, and
currency rate fluctuations); a significant disruption in operations
at one or more of our key manufacturing facilities; negative or
unexpected tax consequences; risks related to a failure of our
information technology systems and networks, and risks associated
with current and emerging technology threats and damage from
computer viruses, unauthorized access, cyber attack and other
similar disruptions; supply shortages or price increases in raw
material and/or freight, utilities or other operating supplies for
us or our customers as a result of pandemics, natural disasters or
otherwise; availability of financing for working capital, capital
expenditures, research and development (R&D) or other general
corporate purposes including acquisitions, as well as our ability
to comply with financial covenants; our customers' and suppliers'
availability of financing for working capital, capital
expenditures, R&D or other general corporate purposes; an
impairment of our goodwill, other intangible assets, or long-lived
assets if our business or market conditions indicate that the
carrying values of those assets exceed their fair values;
liabilities arising from warranty claims, product recall or field
actions, product liability and legal proceedings to which we are or
may become a party, or the impact of product recall or field
actions on our customers; our ability or our customers' and
suppliers' ability to successfully launch new product programs on a
timely basis; our ability to maintain satisfactory labor relations
and avoid work stoppages; our suppliers', our customers' and their
suppliers' ability to maintain satisfactory labor relations and
avoid work stoppages; our ability to achieve the level of cost
reductions required to sustain global cost competitiveness; our
ability to realize the expected revenues from our new and
incremental business backlog; price volatility in, or reduced
availability of, fuel; our ability to protect our intellectual
property and successfully defend against assertions made against
us; risks of noncompliance with environmental laws and regulations
or risks of environmental issues that could result in unforeseen
costs at our facilities, or reputational damage; adverse changes in
laws, government regulations or market conditions affecting our
products or our customers' products; our ability or our customers'
and suppliers' ability to comply with regulatory requirements and
the potential costs of such compliance; changes in liabilities
arising from pension and other postretirement benefit obligations;
our ability to attract and retain key associates; and other
unanticipated events and conditions that may hinder our ability to
compete. It is not possible to foresee or identify all such factors
and any or all of the foregoing factors may be exacerbated by
COVID-19. Further, we make no commitment to update any
forward-looking statement or to disclose any facts, events or
circumstances after the date hereof that may affect the accuracy of
any forward-looking statement.
For more information:
Investor Contact
Jason P.
Parsons
Director, Investor
Relations
(313)
758-2404
jason.parsons@aam.com
Media Contact
Christopher M. Son
Vice President, Marketing & Communications
(313) 758-4814
chris.son@aam.com
Or visit the AAM website at www.aam.com.
AMERICAN AXLE
& MANUFACTURING HOLDINGS, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(in millions,
except per share data)
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
515.3
|
|
|
$
|
1,704.3
|
|
|
$
|
1,858.8
|
|
|
$
|
3,423.5
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
614.2
|
|
|
1,456.0
|
|
|
1,762.4
|
|
|
2,953.0
|
|
|
|
|
|
|
|
|
|
Gross profit
(loss)
|
(98.9)
|
|
|
248.3
|
|
|
96.4
|
|
|
470.5
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
73.8
|
|
|
91.3
|
|
|
164.1
|
|
|
182.0
|
|
|
|
|
|
|
|
|
|
Amortization of
intangible assets
|
21.6
|
|
|
24.9
|
|
|
43.4
|
|
|
49.9
|
|
|
|
|
|
|
|
|
|
Impairment
charge
|
—
|
|
|
—
|
|
|
510.0
|
|
|
—
|
|
|
|
|
|
|
|
|
|
Restructuring and
acquisition-related costs
|
11.3
|
|
|
12.2
|
|
|
28.9
|
|
|
24.3
|
|
|
|
|
|
|
|
|
|
Loss on sale of
business
|
—
|
|
|
—
|
|
|
1.0
|
|
|
—
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
(205.6)
|
|
|
119.9
|
|
|
(651.0)
|
|
|
214.3
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
(54.6)
|
|
|
(56.2)
|
|
|
(106.1)
|
|
|
(109.6)
|
|
|
|
|
|
|
|
|
|
Interest
income
|
3.0
|
|
|
0.5
|
|
|
5.8
|
|
|
1.2
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
Debt refinancing and
redemption costs
|
—
|
|
|
(2.4)
|
|
|
(1.5)
|
|
|
(2.4)
|
|
Other income (expense),
net
|
0.1
|
|
|
(3.1)
|
|
|
(2.2)
|
|
|
(6.1)
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
(257.1)
|
|
|
58.7
|
|
|
(755.0)
|
|
|
97.4
|
|
|
|
|
|
|
|
|
|
Income tax expense
(benefit)
|
(43.9)
|
|
|
6.0
|
|
|
(40.6)
|
|
|
3.0
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
(213.2)
|
|
|
52.7
|
|
|
(714.4)
|
|
|
94.4
|
|
|
|
|
|
|
|
|
|
Net income
attributable to noncontrolling interests
|
—
|
|
|
(0.2)
|
|
|
(0.1)
|
|
|
(0.3)
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to AAM
|
$
|
(213.2)
|
|
|
$
|
52.5
|
|
|
$
|
(714.5)
|
|
|
$
|
94.1
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share
|
$
|
(1.88)
|
|
|
$
|
0.45
|
|
|
$
|
(6.33)
|
|
|
$
|
0.81
|
|
AMERICAN AXLE
& MANUFACTURING HOLDINGS, INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
|
|
June 30,
2020
|
|
December 31,
2019
|
|
(in
millions)
|
ASSETS
|
|
|
|
Current
assets
|
|
Cash and cash
equivalents
|
$
|
893.3
|
|
|
$
|
532.0
|
|
Accounts receivable,
net
|
550.2
|
|
|
815.4
|
|
Inventories,
net
|
358.5
|
|
|
373.6
|
|
Prepaid expenses and
other
|
159.5
|
|
|
136.8
|
|
Total current
assets
|
1,961.5
|
|
|
1,857.8
|
|
|
|
|
|
Property, plant and
equipment, net
|
2,209.9
|
|
|
2,358.4
|
|
Deferred income
taxes
|
101.9
|
|
|
64.1
|
|
Goodwill
|
181.9
|
|
|
699.1
|
|
Other intangible
assets, net
|
821.8
|
|
|
864.5
|
|
GM postretirement
cost sharing asset
|
223.3
|
|
|
223.3
|
|
Other assets and
deferred charges
|
554.7
|
|
|
577.4
|
|
Total
assets
|
$
|
6,055.0
|
|
|
$
|
6,644.6
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities
|
|
|
|
Borrowings under
Revolving Credit Facility
|
$
|
200.0
|
|
|
—
|
|
Current portion of
long-term debt
|
373.7
|
|
|
28.7
|
|
Accounts
payable
|
353.2
|
|
|
623.5
|
|
Accrued compensation
and benefits
|
139.8
|
|
|
154.4
|
|
Deferred
revenue
|
22.5
|
|
|
18.9
|
|
Accrued expenses and
other
|
171.1
|
|
|
200.9
|
|
Total current
liabilities
|
1,260.3
|
|
|
1,026.4
|
|
|
|
|
|
Long-term debt,
net
|
3,561.4
|
|
|
3,612.3
|
|
Deferred
revenue
|
78.5
|
|
|
83.7
|
|
Deferred income
taxes
|
44.6
|
|
|
19.6
|
|
Postretirement
benefits and other long-term liabilities
|
911.4
|
|
|
922.2
|
|
Total
liabilities
|
5,856.2
|
|
|
5,664.2
|
|
|
|
|
|
Total AAM
stockholders' equity
|
196.2
|
|
|
977.6
|
|
Noncontrolling
interests in subsidiaries
|
2.6
|
|
|
2.8
|
|
Total stockholders'
equity
|
198.8
|
|
|
980.4
|
|
Total liabilities
and stockholders' equity
|
$
|
6,055.0
|
|
|
$
|
6,644.6
|
|
AMERICAN AXLE
& MANUFACTURING HOLDINGS, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June
30,
|
|
June
30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
(in
millions)
|
Operating
activities
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
|
(213.2)
|
|
|
$
|
52.7
|
|
|
$
|
(714.4)
|
|
|
$
|
94.4
|
|
Adjustments to
reconcile net income (loss) to net cash provided by (used in)
operating activities
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
139.1
|
|
|
136.5
|
|
|
268.7
|
|
|
277.3
|
|
Impairment
charge
|
|
—
|
|
|
—
|
|
|
510.0
|
|
|
—
|
|
Other
|
|
(68.4)
|
|
|
27.9
|
|
|
(67.4)
|
|
|
(234.8)
|
|
Net cash provided
by (used in) operating activities
|
|
(142.5)
|
|
|
217.1
|
|
|
(3.1)
|
|
|
136.9
|
|
|
|
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
(35.9)
|
|
|
(113.3)
|
|
|
(105.6)
|
|
|
(237.5)
|
|
Proceeds from sale of
property, plant and equipment
|
|
0.9
|
|
|
1.4
|
|
|
1.4
|
|
|
1.7
|
|
Other
|
|
(4.6)
|
|
|
(2.2)
|
|
|
(4.6)
|
|
|
(2.2)
|
|
Net cash used in
investing activities
|
|
(39.6)
|
|
|
(114.1)
|
|
|
(108.8)
|
|
|
(238.0)
|
|
|
|
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
|
|
|
Net debt
activity
|
|
393.5
|
|
|
(106.1)
|
|
|
482.6
|
|
|
(120.2)
|
|
Other
|
|
(1.0)
|
|
|
(0.2)
|
|
|
(2.4)
|
|
|
(7.5)
|
|
Net cash provided
by (used in) financing activities
|
|
392.5
|
|
|
(106.3)
|
|
|
480.2
|
|
|
(127.7)
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
0.2
|
|
|
—
|
|
|
(7.0)
|
|
|
1.2
|
|
|
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash, cash equivalents and restricted
cash
|
|
210.6
|
|
|
(3.3)
|
|
|
361.3
|
|
|
(227.6)
|
|
|
|
|
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash at beginning of
period
|
|
682.7
|
|
|
254.6
|
|
|
532.0
|
|
|
478.9
|
|
|
|
|
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash at end of period
|
|
$
|
893.3
|
|
|
$
|
251.3
|
|
|
$
|
893.3
|
|
|
$
|
251.3
|
|
AMERICAN AXLE
& MANUFACTURING HOLDINGS, INC.
SUPPLEMENTAL
DATA
(Unaudited)
|
|
The supplemental data
presented below is a reconciliation of certain financial measures
which is intended to facilitate analysis of American Axle &
Manufacturing Holdings, Inc. business and operating
performance.
|
|
Earnings (loss)
before interest expense, income taxes and depreciation and
amortization (EBITDA) and Adjusted
EBITDA(a)
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
(213.2)
|
|
|
$
|
52.7
|
|
|
$
|
(714.4)
|
|
|
$
|
94.4
|
|
Interest
expense
|
54.6
|
|
|
56.2
|
|
|
106.1
|
|
|
109.6
|
|
Income tax expense
(benefit)
|
(43.9)
|
|
|
6.0
|
|
|
(40.6)
|
|
|
3.0
|
|
Depreciation and
amortization
|
139.1
|
|
|
136.5
|
|
|
268.7
|
|
|
277.3
|
|
EBITDA
|
(63.4)
|
|
|
251.4
|
|
|
(380.2)
|
|
|
484.3
|
|
Restructuring and
acquisition-related costs
|
11.3
|
|
|
12.2
|
|
|
28.9
|
|
|
24.3
|
|
Debt refinancing and
redemption costs
|
—
|
|
|
2.4
|
|
|
1.5
|
|
|
2.4
|
|
Impairment
charge
|
—
|
|
|
—
|
|
|
510.0
|
|
|
—
|
|
Loss on sale of
business
|
—
|
|
|
—
|
|
|
1.0
|
|
|
—
|
|
Adjusted
EBITDA
|
$
|
(52.1)
|
|
|
$
|
266.0
|
|
|
$
|
161.2
|
|
|
$
|
511.0
|
|
Adjusted earnings
(loss) per share(b)
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Diluted earnings
(loss) per share
|
$
|
(1.88)
|
|
|
$
|
0.45
|
|
|
$
|
(6.33)
|
|
|
$
|
0.81
|
|
Restructuring and
acquisition-related costs
|
0.10
|
|
|
0.11
|
|
|
0.26
|
|
|
0.21
|
|
Debt refinancing and
redemption costs
|
—
|
|
|
0.02
|
|
|
0.01
|
|
|
0.02
|
|
Impairment
charge
|
—
|
|
|
—
|
|
|
4.52
|
|
|
—
|
|
Loss on sale of
business
|
—
|
|
|
—
|
|
|
0.01
|
|
|
—
|
|
Non-recurring
items:
|
|
|
|
|
|
|
|
Adjustment to
liability for unrecognized tax benefits
|
(0.06)
|
|
|
—
|
|
|
(0.06)
|
|
|
—
|
|
Tax adjustments
related to the CARES Act and Tax Cuts and Jobs Act
|
—
|
|
|
—
|
|
|
(0.07)
|
|
|
(0.08)
|
|
Other(c)
|
0.08
|
|
|
—
|
|
|
0.14
|
|
|
—
|
|
Tax effect of
adjustments
|
(0.03)
|
|
|
(0.03)
|
|
|
(0.07)
|
|
|
(0.05)
|
|
Adjusted earnings
(loss) per share
|
$
|
(1.79)
|
|
|
$
|
0.55
|
|
|
$
|
(1.59)
|
|
|
$
|
0.91
|
|
|
Adjusted earnings
(loss) per share are based on weighted average diluted shares
outstanding of 113.1 million and 116.1 million for the three months
ended on June 30, 2020 and 2019, respectively, and 112.9 million
and 116.0 million for the six months ended on June 30, 2020 and
2019, respectively.
|
AMERICAN AXLE
& MANUFACTURING HOLDINGS, INC.
SUPPLEMENTAL
DATA
(Unaudited)
|
|
The supplemental data
presented below is a reconciliation of certain financial measures
which is intended
to facilitate
analysis of American Axle & Manufacturing Holdings, Inc.
business and operating performance
|
|
Free cash flow and
Adjusted free cash flow(d)
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(in
millions)
|
Net cash provided by
(used in) operating activities
|
$
|
(142.5)
|
|
|
$
|
217.1
|
|
|
$
|
(3.1)
|
|
|
$
|
136.9
|
|
Capital expenditures
net of proceeds from the sale of property, plant and
equipment
|
(35.0)
|
|
|
(111.9)
|
|
|
(104.2)
|
|
|
(235.8)
|
|
Free cash
flow
|
(177.5)
|
|
|
105.2
|
|
|
(107.3)
|
|
|
(98.9)
|
|
Cash payments for
restructuring and acquisition-related costs
|
15.7
|
|
|
14.1
|
|
|
28.8
|
|
|
29.7
|
|
Adjusted free cash
flow
|
$
|
(161.8)
|
|
|
$
|
119.3
|
|
|
$
|
(78.5)
|
|
|
$
|
(69.2)
|
|
Segment Financial
Information
|
|
In the fourth quarter
of 2019 we completed the sale of our U.S. iron casting
operations. The sale did not include the entities that
conduct AAM's casting operations in El Carmen, Mexico, which are
now included in our Driveline segment.
|
|
As a result, our
business is now organized into Driveline and Metal Forming.
The Casting segment is now comprised entirely of the U.S. casting
operations that were sold. The amounts previously reported in
our Casting segment for the retained operations in El Carmen,
Mexico have been reclassified to our Driveline Segment for the
periods presented.
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(in
millions)
|
Segment
Sales
|
|
|
|
|
|
|
|
Driveline
|
$
|
403.7
|
|
|
$
|
1,181.5
|
|
|
$
|
1,435.4
|
|
|
$
|
2,347.8
|
|
Metal
Forming
|
150.3
|
|
|
484.2
|
|
|
572.6
|
|
|
967.5
|
|
Casting
|
—
|
|
|
179.7
|
|
|
—
|
|
|
373.4
|
|
Total
Sales
|
554.0
|
|
|
1,845.4
|
|
|
2,008.0
|
|
|
3,688.7
|
|
Intersegment
Sales
|
(38.7)
|
|
|
(141.1)
|
|
|
(149.2)
|
|
|
(265.2)
|
|
Net External
Sales
|
$
|
515.3
|
|
|
$
|
1,704.3
|
|
|
$
|
1,858.8
|
|
|
$
|
3,423.5
|
|
|
|
|
|
|
|
|
|
Segment Adjusted
EBITDA(a)
|
|
|
|
|
|
|
|
Driveline
|
$
|
(31.2)
|
|
|
$
|
162.1
|
|
|
$
|
108.1
|
|
|
$
|
304.9
|
|
Metal
Forming
|
(20.9)
|
|
|
86.5
|
|
|
53.1
|
|
|
170.9
|
|
Casting
|
—
|
|
|
17.4
|
|
|
—
|
|
|
35.2
|
|
Total Segment
Adjusted EBITDA
|
$
|
(52.1)
|
|
|
$
|
266.0
|
|
|
$
|
161.2
|
|
|
$
|
511.0
|
|
|
|
(a)
|
We define EBITDA to
be earnings (loss) before interest expense, income taxes,
depreciation and amortization. Adjusted EBITDA is defined as
EBITDA excluding the impact of restructuring and
acquisition-related costs, debt refinancing and redemption costs,
loss on sale of a business, impairment charges, and non-recurring
items. We believe that EBITDA and Adjusted EBITDA are meaningful
measures of performance as they are commonly utilized by management
and investors to analyze operating performance and entity
valuation. Our management, the investment community and the banking
institutions routinely use EBITDA and Adjusted EBITDA, together
with other measures, to measure our operating performance relative
to other Tier 1 automotive suppliers. We also use Segment Adjusted
EBITDA as the measure of earnings to assess the performance of each
segment and determine the resources to be allocated to the
segments. EBITDA and Adjusted EBITDA should not be construed as
income from operations, net income or cash flow from operating
activities as determined under GAAP. Other companies may
calculate EBITDA and Adjusted EBITDA differently.
|
|
|
(b)
|
We define Adjusted
earnings (loss) per share to be diluted earnings (loss) per share
excluding the impact of restructuring and acquisition-related
costs, debt refinancing and redemption costs, loss on sale of a
business, impairment charges, and non-recurring items, including
the tax effect thereon. We believe Adjusted (loss) earnings
per share is a meaningful measure as it is commonly utilized by
management and investors in assessing ongoing financial performance
that provides improved comparability between periods through the
exclusion of certain items that management believes are not
indicative of core operating performance and which may obscure
underlying business results and trends. Other companies may
calculate Adjusted earnings (loss) per share
differently.
|
|
|
(c)
|
Other includes the
accelerated depreciation for certain assets that will be idled as a
result of our largest customer exiting their operations in
Thailand, which they announced in 2020.
|
|
|
(d)
|
We define free cash
flow to be net cash provided by (used in) operating activities less
capital expenditures net of proceeds from the sale of property,
plant and equipment. Adjusted free cash flow is defined as
free cash flow excluding the impact of cash payments for
restructuring and acquisition-related costs. We believe free
cash flow and Adjusted free cash flow are meaningful measures as
they are commonly utilized by management and investors to assess
our ability to generate cash flow from business operations to repay
debt and return capital to our stockholders. Free cash flow
and Adjusted free cash flow are also key metrics used in our
calculation of incentive compensation. Other companies may
calculate free cash flow and Adjusted free cash flow
differently.
|
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SOURCE American Axle & Manufacturing Holdings, Inc.