Detroit, Michigan, October 26, 2012 -- American
Axle & Manufacturing Holdings, Inc. (AAM), which is traded as
AXL on the NYSE, today reported its financial results for the third
quarter of 2012.
Third Quarter 2012
Results
-
Third quarter 2012 sales of $702.9 million, up
8.5% from the third quarter of 2011
-
Non-GM sales grew approximately 14% on a
year-over-year basis to $198.8 million
-
Gross profit of $90.7 million, or 12.9% of sales
-
Operating income of $30.1 million, or 4.3% of
sales
-
Net loss of $8.1 million, or $0.11 per
share
-
AAM's quarterly results reflect the impact of
$10.1 million (or $0.14 per share) of debt refinancing and
redemption costs and $3.2 million (or $0.04 per share) of
restructuring costs related to the closure of our Detroit
Manufacturing Complex and Cheektowaga Manufacturing
Facility
AAM's results in the third quarter were a net loss
of $8.1 million or $0.11 per share. This compares to net
earnings of $24.8 million or $0.33 per share in the third quarter
of 2011.
In the third quarter of 2012, AAM's quarterly
results reflect the impact of $10.1 million (or $0.14 per share) of
debt refinancing and redemption costs and $3.2 million (or $0.04
per share) of restructuring costs related to the closure of our
Detroit Manufacturing Complex and Cheektowaga Manufacturing
Facility.
"AAM's results in the third quarter of 2012
reflect an increased level of global launch activity. The
complexity of these new product, process and facility launches, as
well as lower capacity utilization resulting from planned customer
downtime on certain existing programs, adversely impacted our
financial performance in the quarter," said AAM's President and
Chief Executive Officer, David C. Dauch. "While we are
focused on taking the necessary actions to improve AAM's operating
performance, we are very excited about the strong sales growth and
improved business diversification resulting from our global launch
activity."
Dauch also stated, "AAM's results in the third
quarter of 2012 also reflect the impact of a number of successful
financing actions we completed in the quarter. These actions
included increasing commitments under our revolving bank credit
facility by approximately $116 million and issuing $550 million of
6.625% Senior Unsecured Notes due 2022. The net proceeds were
used for general corporate purposes, including to fund the
repurchase and redemption of all of the 5.25% Senior Notes due in
2014. As a result of these actions and related initiatives,
AAM now has no significant debt maturities scheduled until 2017."
Net sales in the third quarter of 2012 increased
approximately 8.5% to $702.9 million as compared to $647.6 million
in the third quarter of 2011. Non-GM sales in the third
quarter of 2012 increased approximately 14% on a year-over-year
basis to $198.8 million.
AAM's content-per-vehicle is measured by the
dollar value of its product sales supporting our customers' North
American light truck and SUV programs. In the third quarter of
2012, AAM's content-per-vehicle was $1,466, approximately the same
as in the third quarter of 2011.
AAM's net sales of approximately $2.2 billion in
the first three quarters of 2012 increased by $214.8 million, or
10.9%, as compared to approximately $2.0 billion in the first three
quarters of 2011. Non-GM sales for the year-to-date period of
$588.5 million grew by approximately 10.0% on a year-over-year
basis as compared to the first three quarters of 2011.
AAM's gross profit in the third quarter of 2012
was $90.7 million, or 12.9% of sales as compared to $103.5 million
or 16.0% sales in the third quarter of 2011. In the
first three quarters of 2012, AAM's gross profit was $315.7
million, or 14.4% of sales, as compared to $349.4 million for the
first three quarters of 2011.
AAM's operating income in the third quarter of
2012 was $30.1 million or 4.3% of sales as compared to $44.5
million or 6.9% of sales in the third quarter of 2011. In the
first three quarters of 2012, AAM's operating income was $137.8
million, or 6.3% of sales, as compared to $174.9 million for the
first three quarters of 2011.
AAM's SG&A spending in the third quarter of
2012 was $60.6 million as compared to $59.0 million in the third
quarter of 2011. AAM's R&D spending in the quarter was
$31.4 million as compared to $31.8 million in the third quarter of
2011.
In the first three quarters of 2012, AAM's
SG&A spending was $177.9 million as compared to $174.5 million
in the first three quarters of 2011. AAM's R&D spending
for the first three quarters of 2012 increased by $4.9 million on a
year-over-year basis to $90.3 million as compared to $85.4 million
in the first three quarters of 2011.
AAM defines Adjusted EBITDA to be earnings before
interest, taxes, depreciation and amortization excluding the impact
of curtailment gains, asset impairments, restructuring costs and
special charges related to the closure of the Detroit Manufacturing
Complex and Cheektowaga Manufacturing Facility, and debt
refinancing and redemption costs, to the extent applicable.
AAM's Adjusted EBITDA in the third quarter of 2012 was $70.1
million, or 10.0% of sales.
In the first three quarters of 2012, AAM's
Adjusted EBITDA was $282.2 million, or 12.9% of sales.
AAM defines free cash flow to be net cash provided
by (or used in) operating activities less capital expenditures net
of proceeds from the sales of equipment. Net cash used in
operating activities in the first three quarters of 2012 was $196.6
million. Capital spending, net of proceeds from the sale of
equipment for the first three quarters of 2012, was $141.5 million.
Reflecting the impact of this activity, AAM's free cash flow
was a use of $338.1 million in the first three quarters of 2012.
AAM's free cash flow in the first three quarters
of 2012 reflects the impact of $225 million of contributions to our
defined benefit pension plans. On September 27, 2012 AAM and the
Pension Benefit Guaranty Corporation entered into an agreement in
connection with the closures of the Detroit Manufacturing Facility
and Cheektowaga Manufacturing Facility. As part of this agreement,
in September 2012, we contributed $114.7 million in excess of our
statutory minimums to our hourly pension plan which is included in
the contributions described above. AAM's free cash flow in
the first three quarters of 2012 also reflects cash used for
restructuring activities of $37.4 million.
A conference call to review AAM's third quarter
2012 results and new business backlog 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) 278-1452 from the United
States or (973) 200-3383 from outside the United States. A
replay will be available from Noon ET on October 26, 2012 until
5:00 p.m. ET November 2, 2012 by dialing (800) 642-1687 from the
United States or (706) 645-9291 from outside the United States.
When prompted, callers should enter conference reservation
number 32991103.
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 information is reconciled to its closest GAAP
measure in accordance with the Securities and Exchange Commission
rules and is included in the attached supplemental data.
Management believes that these non-GAAP financial
measures are useful to both management and its stockholders 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.
AAM is a world leader in the manufacture,
engineering, design and validation of driveline and drivetrain
systems and related components and modules, chassis systems and
metal-formed products for light trucks, sport utility vehicles,
passenger cars, crossover vehicles and commercial vehicles.
In addition to locations in the United States (Michigan,
Ohio, Pennsylvania and Indiana), AAM also has offices or facilities
in Brazil, China, Germany, India, Japan, Luxembourg, Mexico,
Poland, Scotland, South Korea, Sweden and Thailand.
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," and similar words of 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: global economic conditions, including
the impact of the current sovereign debt crisis in the Euro-zone; reduced
purchases of our
products by General Motors Company (GM), Chrysler
Group LLC (Chrysler)
or other customers; reduced demand for our customers'
products (particularly light trucks and SUVs produced by GM and
Chrysler); liabilities arising from warranty claims, product recall, product liability and legal proceedings to which we are or may become a party; our ability to
realize the
expected revenues
from our new business
backlog; our ability or our customers'
and suppliers'
ability to successfully launch new product programs on a timely basis; our ability to
achieve the
level of cost
reductions required
to sustain global cost competitiveness; our ability to
attract new customers
and programs
for new products; supply shortages or price increases in raw materials, utilities
or other operating
supplies for us or our
customers as a result of natural disasters or otherwise; our ability to
respond to changes
in technology, increased competition or pricing
pressures; price volatility in, or reduced availability
of, fuel; 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 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; risks inherent in our international operations (including
adverse changes
in political
stability, taxes and other law
changes, potential disruptions of production
and supply and currency rate fluctuations);
availability of financing for working capital, capital
expenditures, R&D
or other general
corporate purposes,
including 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; adverse changes
in laws, government
regulations or market
conditions affecting our products or our customers' products (such as
the Corporate Average Fuel Economy ("CAFE") regulations); changes
in liabilities
arising from
pension and
other postretirement
benefit obligations; our
ability to consummate and integrate acquisitions
and joint ventures; risks of noncompliance with environmental laws and regulations or risks of environmental issues
that could result in unforeseen costs at our facilities; our
ability to attract and retain key associates; other unanticipated
events and conditions that may hinder our ability to compete. It is not possible to foresee or
identify all such
factors and 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...
Christopher M. Son
Director, Investor Relations,
Corporate Communications & Marketing
(313) 758-4814
chris.son@aam.com
David Tworek
Manager, Communications
(313) 758-4883
david.tworek@aam.com
Or visit the AAM website at www.aam.com.
| AMERICAN
AXLE & MANUFACTURING HOLDINGS, INC. |
| CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
| (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended |
|
Nine
months ended |
|
September 30, |
|
September 30, |
|
2012 |
|
2011 |
|
2012 |
|
2011 |
|
(In
millions, except per share data) |
|
(In
millions, except per share data) |
| Net sales |
$ 702.9 |
|
$ 647.6 |
|
$ 2,194.2 |
|
$ 1,979.4 |
|
|
|
|
|
|
|
|
| Cost of goods sold |
612.2 |
|
544.1 |
|
1,878.5 |
|
1,630.0 |
|
|
|
|
|
|
|
|
| Gross profit |
90.7 |
|
103.5 |
|
315.7 |
|
349.4 |
|
|
|
|
|
|
|
|
| Selling, general and administrative expenses |
60.6 |
|
59.0 |
|
177.9 |
|
174.5 |
|
|
|
|
|
|
|
|
| Operating income |
30.1 |
|
44.5 |
|
137.8 |
|
174.9 |
|
|
|
|
|
|
|
|
| Interest expense |
(25.3) |
|
(19.7) |
|
(72.7) |
|
(61.5) |
| Investment income |
0.2 |
|
0.3 |
|
0.6 |
|
0.9 |
| Other income (expense), net |
|
|
|
|
|
|
|
| Debt refinancing and redemption costs |
(10.1) |
|
- |
|
(10.1) |
|
(3.1) |
| Other, net |
(2.2) |
|
(0.2) |
|
(4.0) |
|
0.1 |
|
|
|
|
|
|
|
|
| Income (loss) before income taxes |
(7.3) |
|
24.9 |
|
51.6 |
|
111.3 |
|
|
|
|
|
|
|
|
| Income tax expense |
0.9 |
|
2.3 |
|
4.8 |
|
4.2 |
|
|
|
|
|
|
|
|
| Net income (loss) |
(8.2) |
|
22.6 |
|
46.8 |
|
107.1 |
|
|
|
|
|
|
|
|
| Net loss attributable to
noncontrolling interests |
0.1 |
|
2.2 |
|
1.0 |
|
4.6 |
|
|
|
|
|
|
|
|
| Net income (loss) attributable to AAM |
$ (8.1) |
|
$ 24.8 |
|
$ 47.8 |
|
$ 111.7 |
|
|
|
|
|
|
|
|
| Diluted earnings (loss) per share |
$ (0.11) |
|
$ 0.33 |
|
$ 0.63 |
|
$ 1.48 |
|
|
|
|
|
|
|
|
| Diluted shares outstanding |
74.9 |
|
75.4 |
|
75.2 |
|
75.4 |
| AMERICAN
AXLE & MANUFACTURING HOLDINGS, INC. |
| CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME |
| (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended |
|
Nine
months ended |
|
September 30, |
|
September 30, |
|
2012 |
|
2011 |
|
2012 |
|
2011 |
|
(In
millions) |
|
(In
millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) |
$
(8.2) |
|
$ 22.6 |
|
$ 46.8 |
|
$ 107.1 |
|
|
|
|
|
|
|
|
| Other comprehensive income (loss), net of tax |
|
|
|
|
|
|
|
| Defined benefit plans |
(102.7) |
|
0.4 |
|
(117.2) |
|
3.9 |
| Foreign currency translation
adjustments |
4.9 |
|
(30.2) |
|
(7.1) |
|
(16.7) |
| Change in derivatives |
2.2 |
|
(9.0) |
|
7.6 |
|
(7.9) |
| Other comprehensive income (loss) |
(95.6) |
|
(38.8) |
|
(116.7) |
|
(20.7) |
|
|
|
|
|
|
|
|
| Comprehensive income (loss) |
(103.8) |
|
(16.2) |
|
(69.9) |
|
86.4 |
|
|
|
|
|
|
|
|
| Net loss attributable to
noncontrolling interests |
0.1 |
|
2.2 |
|
1.0 |
|
4.6 |
Foreign currency
translation adjustments
attributable to noncontrolling interests |
- |
|
0.5 |
|
(0.2) |
|
(0.3) |
|
|
|
|
|
|
|
|
|
|
|
| Comprehensive income (loss) attributable to AAM |
$ (103.7) |
|
$ (13.5) |
|
$ (69.1) |
|
$ 90.7 |
| AMERICAN
AXLE & MANUFACTURING HOLDINGS, INC. |
| CONDENSED CONSOLIDATED BALANCE SHEETS |
| (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
|
2012 |
|
2011 |
|
|
(In
millions) |
| ASSETS |
|
|
|
|
|
|
|
|
| Current assets |
|
|
|
|
| Cash and cash equivalents |
|
$
209.0 |
|
$ 169.2 |
| Accounts receivable, net |
|
465.3 |
|
333.3 |
| Inventories, net |
|
242.3 |
|
177.2 |
| Prepaid expenses and other current
assets |
|
105.5 |
|
83.4 |
| Total current assets |
|
1,022.1 |
|
763.1 |
|
|
|
|
|
| Property, plant and equipment, net |
|
1,007.6 |
|
971.2 |
| Goodwill |
|
156.3 |
|
155.9 |
| GM postretirement cost sharing asset |
|
288.3 |
|
260.2 |
| Other assets and deferred charges |
|
199.9 |
|
178.3 |
| Total assets |
|
$
2,674.2 |
|
$ 2,328.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| LIABILITIES AND STOCKHOLDERS' DEFICIT |
|
|
|
|
|
|
|
|
| Current liabilities |
|
|
|
|
| Accounts payable |
|
$
429.5 |
|
$ 337.1 |
| Accrued compensation and benefits |
|
110.1 |
|
110.6 |
| Deferred revenue |
|
20.6 |
|
32.9 |
| Accrued expenses and other |
|
89.6 |
|
95.5 |
| Total current liabilities |
|
649.8 |
|
576.1 |
|
|
|
|
|
| Long-term debt |
|
1,579.9 |
|
1,180.2 |
| Deferred revenue |
|
81.2 |
|
88.2 |
| Postretirement benefits and other long-term
liabilities |
|
861.0 |
|
903.8 |
| Total liabilities |
|
3,171.9 |
|
2,748.3 |
|
|
|
|
|
|
|
|
|
|
| Stockholders' deficit |
|
(497.7) |
|
(419.6) |
| Total liabilities and stockholders' deficit |
|
$
2,674.2 |
|
$ 2,328.7 |
| AMERICAN
AXLE & MANUFACTURING HOLDINGS, INC. |
| CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
| (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended |
|
Nine
months ended |
|
September 30, |
|
September 30, |
|
2012 |
|
2011 |
|
2012 |
|
2011 |
|
(In
millions) |
|
(In
millions) |
| Operating activities |
|
|
|
|
|
|
|
| Net income (loss) |
$ (8.2) |
|
$ 22.6 |
|
$ 46.8 |
|
$ 107.1 |
| Depreciation and amortization |
38.7 |
|
35.0 |
|
112.4 |
|
103.8 |
| Other |
(251.7) |
|
(239.5) |
|
(355.8) |
|
(276.3) |
|
|
|
|
|
|
|
|
| Net cash flow used in operating
activities |
(221.2) |
|
(181.9) |
|
(196.6) |
|
(65.4) |
|
|
|
|
|
|
|
|
| Investing Activities |
|
|
|
|
|
|
|
| Purchases of property, plant & equipment |
(50.8) |
|
(39.4) |
|
(143.7) |
|
(111.0) |
| Proceeds from sales of property, plant &
equipment |
1.0 |
|
0.1 |
|
2.2 |
|
7.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net cash flow used in investing
activities |
(49.8) |
|
(39.3) |
|
(141.5) |
|
(103.1) |
|
|
|
|
|
|
|
|
| Financing Activities |
|
|
|
|
|
|
|
| Net increase in long-term debt |
404.3 |
|
88.0 |
|
397.0 |
|
40.6 |
| Debt issuance costs |
(10.1) |
|
(0.4) |
|
(10.1) |
|
(5.7) |
| Employee stock option exercises |
- |
|
- |
|
0.1 |
|
4.6 |
| Purchase of treasury stock |
-
|
|
-
|
|
(5.9) |
|
(0.1) |
| Purchase of noncontrolling interest |
-
|
|
-
|
|
(4.0) |
|
-
|
|
|
|
|
|
|
|
|
| Net cash flow provided by financing
activities |
394.2 |
|
87.6 |
|
377.1 |
|
39.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Effect of exchange rate changes on cash |
0.6 |
|
(2.3) |
|
0.8 |
|
(1.1) |
|
|
|
|
|
|
|
|
| Net increase (decrease) in cash and
cash equivalents |
123.8 |
|
(135.9) |
|
39.8 |
|
(130.2) |
|
|
|
|
|
|
|
|
| Cash and cash equivalents at beginning of period |
85.2 |
|
250.3 |
|
169.2 |
|
244.6 |
|
|
|
|
|
|
|
|
| Cash and cash equivalents at end of
period |
$
209.0 |
|
$
114.4 |
|
$
209.0 |
|
$
114.4 |
| 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
before interest expense, income taxes and depreciation and
amortization (EBITDA) and adjusted EBITDA(a) |
|
|
|
|
|
|
|
|
|
Three
months ended |
|
Nine
months ended |
|
September 30, |
|
September 30, |
|
2012 |
|
2011 |
|
2012 |
|
2011 |
|
(In
millions) |
|
(In
millions) |
|
|
|
|
|
|
|
|
| Net income (loss) attributable to AAM |
$ (8.1) |
|
$ 24.8 |
|
$ 47.8 |
|
$ 111.7 |
| Interest expense |
25.3 |
|
19.7 |
|
72.7 |
|
61.5 |
| Income tax expense |
0.9 |
|
2.3 |
|
4.8 |
|
4.2 |
| Depreciation and amortization |
38.7 |
|
35.0 |
|
112.4 |
|
103.8 |
|
|
|
|
|
|
|
|
| EBITDA |
$ 56.8 |
|
$ 81.8 |
|
$ 237.7 |
|
$ 281.2 |
|
|
|
|
|
|
|
|
| Debt refinancing and redemption costs |
10.1 |
|
- |
|
10.1 |
|
3.1 |
| Other special charges, asset impairments, curtailment
gains and restructuring costs (e) |
3.2 |
|
11.4 |
|
34.4 |
|
11.4 |
| ADJUSTED EBITDA |
$ 70.1 |
|
$ 93.2 |
|
$ 282.2 |
|
$ 295.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net
debt(b) to
capital |
|
|
|
|
|
September 30, |
|
December 31, |
|
|
|
|
|
2012 |
|
2011 |
|
|
|
|
|
(In
millions, except percentages) |
|
|
|
|
|
|
|
|
| Total debt |
|
|
|
|
$ 1,579.9 |
|
$ 1,180.2 |
| Less: cash and cash equivalents |
|
|
|
|
209.0 |
|
169.2 |
|
|
|
|
|
|
|
|
| Net debt at end of period |
|
|
|
|
1,370.9 |
|
1,011.0 |
|
|
|
|
|
|
|
|
| Stockholders' deficit |
|
|
|
|
(497.7) |
|
(419.6) |
| Total invested capital at end of period |
|
|
|
|
$ 873.2 |
|
$ 591.4 |
| Net debt to
capital(c) |
|
|
|
|
157.0% |
|
171.0% |
| Net
Operating Cash Flow and Free Cash Flow(d) |
|
Three
months ended |
|
Nine
months ended |
|
September 30, |
|
September 30, |
|
2012 |
|
2011 |
|
2012 |
|
2011 |
|
(In
millions) |
|
(In
millions) |
|
|
|
|
|
|
|
|
| Net cash used in operating activities |
$(221.2) |
|
$(181.9) |
|
$(196.6) |
|
$ (65.4) |
| Less: Purchases of property, plant & equipment, net of
proceeds from sale of equipment |
(49.8) |
|
(39.3) |
|
(141.5) |
|
(103.1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net operating cash
flow |
(271.1) |
|
(221.2) |
|
(338.1) |
|
(168.5) |
|
|
|
|
|
|
|
|
| Free cash flow |
$(271.0) |
|
$(221.2) |
|
$(338.1) |
|
$(168.5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (a) We
define EBITDA to be earnings before interest, taxes, depreciation
and amortization. Adjusted EBITDA is defined as EBITDA
excluding the impact of curtailment gains, asset impairments,
restructuring costs, and special charges related to the closure of
the Detroit Manufacturing Complex and Cheektowaga Manufacturing
Facility, and debt refinancing and redemption costs, to the extent
applicable. 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, together with
other measures, to measure our operating performance relative to
other Tier 1 automotive suppliers. 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) Net
debt is equal to total debt less cash and cash equivalents.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (c) Net
debt to capital is equal to net debt divided by the sum of
stockholders' deficit and net debt. We believe that net debt
to capital is a meaningful measure of financial condition as it is
commonly utilized by management, investors and creditors to assess
relative capital structure risk. Other companies may
calculate net debt to capital differently. |
|
|
|
|
|
|
|
|
| (d) We
define free cash flow as net cash provided by (used in) operating
activities less purchases of property, plant and equipment, net of
proceeds from sales of equipment. For purposes of calculating
free cash flow, AAM excludes the impact of purchase buyouts of
leased equipment, if any. We believe free cash flow is a
meaningful measure as it is 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 is also a key metric used in our calculation
of incentive compensation. Other companies may calculate free
cash flow differently. |
|
|
|
|
|
|
|
|
| (e)
Special charges and restructuring costs of $3.2 million for
three months ended September 30, 2012 and $34.4 million for the
nine months ended September 30 , 2012 primarily relate to the
closure of our Detroit Manufacturing Complex and Cheektowaga
Manufacturing Facility. This special charge activity includes
$28.7 million of expense related to pension and postretirement
benefits to be provided to certain eligible UAW associates as a
result of the Detroit Manufacturing Complex and Cheektowaga
Manufacturing Facility plant closures, $27.5 million of expense
primarily related to asset redeployment and other restructuring
costs associated with the closures of Detroit Manufacturing Complex
and Cheektowaga Manufacturing Facility and a $21.8 million
postretirement benefit curtailment gain recorded in the first
quarter of 2012. |
This
announcement is distributed by Thomson Reuters on behalf of Thomson
Reuters clients.
The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the
information contained therein.
Source: American Axle & Manufacturing Holdings, Inc via Thomson
Reuters ONE
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