Supplemental Guarantor Condensed Consolidating Financial Statements

9 Months Ended

Sep. 30, 2013

Supplemental Guarantor Condensed Consolidating Financial Statements [Abstract]

Supplemental Guarantor Disclosure [Text Block]

13. SUPPLEMENTAL GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

Holdings has no significant assets other than its 100% ownership in AAM, Inc. and no direct subsidiaries other than AAM, Inc.  The 9.25% Notes are senior secured obligations of AAM Inc. and the 7.75% Notes, 6.625% Notes and 6.25% Notes are senior unsecured obligations of AAM Inc.; all of which are fully and unconditionally and joint and severally, guaranteed by Holdings and substantially all domestic subsidiaries of AAM, Inc., which are 100% indirectly owned by Holdings.

These Condensed Consolidating Financial Statements are prepared under the equity method of accounting whereby the investments in subsidiaries are recorded at cost and adjusted for the parent’s share of the subsidiaries’ cumulative results of operations, capital contributions and distributions, and other equity changes.

Condensed Consolidating Statements of Operations
Three Months Ended September 30,
(in millions)
	Holdings		AAM Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Elims			Consolidated
2013
Net sales
External	$	—	$	162.6		$	57.8		$	600.4		$	—		$	820.8
Intercompany	—		5.0			55.2			1.7			(61.9		)	—
Total net sales	—		167.6			113.0			602.1			(61.9		)	820.8
Cost of goods sold	—		170.1			97.2			490.1			(61.9		)	695.5
Gross profit (loss)	—		(2.5		)	15.8			112.0			—			125.3
Selling, general and administrative expenses	—		48.1			—			9.7			—			57.8
Operating income (loss)	—		(50.6		)	15.8			102.3			—			67.5
Non-operating income (expense), net	—		(30.6		)	2.5			(1.7		)	—			(29.8		)
Income (loss) before income taxes	—		(81.2		)	18.3			100.6			—			37.7
Income tax expense	—		0.9			—			5.2			—			6.1
Earnings (loss) from equity in subsidiaries	31.6		50.7			(1.5		)	—			(80.8		)	—
Net income (loss) before royalties and dividends	31.6		(31.4		)	16.8			95.4			(80.8		)	31.6
Royalties and dividends	—		63.0			—			(63.0		)	—			—
Net income after royalties and dividends	31.6		31.6			16.8			32.4			(80.8		)	31.6
Net loss attributable to noncontrolling interests	—		—			—			—			—			—
Net income attributable to AAM	$	31.6	$	31.6		$	16.8		$	32.4		$	(80.8	)	$	31.6
Other comprehensive income (loss)	17.0		17.0			(0.8		)	(1.7		)	(14.5		)	17.0
Comprehensive income attributable to AAM	$	48.6	$	48.6		$	16.0		$	30.7		$	(95.3	)	$	48.6

	Holdings			AAM Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Elims			Consolidated
2012
Net sales
External	$	—		$	162.2		$	55.4		$	485.3		$	—		$	702.9
Intercompany	—			3.5			54.4			10.1			(68.0		)	—
Total net sales	—			165.7			109.8			495.4			(68.0		)	702.9
Cost of goods sold	—			164.3			97.7			418.2			(68.0		)	612.2
Gross profit	—			1.4			12.1			77.2			—			90.7
Selling, general and administrative expenses	—			50.0			—			10.6			—			60.6
Operating income (loss)	—			(48.6		)	12.1			66.6			—			30.1
Non-operating income (expense), net	—			(35.7		)	0.1			(1.8		)	—			(37.4		)
Income (loss) before income taxes	—			(84.3		)	12.2			64.8			—			(7.3		)
Income tax expense	—			0.1			—			0.8			—			0.9
Earnings (loss) from equity in subsidiaries	(8.1		)	34.5			(14.7		)	—			(11.7		)	—
Net income (loss) before royalties and dividends	(8.1		)	(49.9		)	(2.5		)	64.0			(11.7		)	(8.2		)
Royalties and dividends	—			41.8			—			(41.8		)	—			—
Net income (loss) after royalties and dividends	(8.1		)	(8.1		)	(2.5		)	22.2			(11.7		)	(8.2		)
Net loss attributable to noncontrolling interests	—			—			—			0.1			—			0.1
Net income (loss) attributable to AAM	$	(8.1	)	$	(8.1	)	$	(2.5	)	$	22.3		$	(11.7	)	$	(8.1	)
Other comprehensive income (loss)	(95.6		)	(95.6		)	4.1			5.8			85.7			(95.6		)
Comprehensive income (loss) attributable to AAM	$	(103.7	)	$	(103.7	)	$	1.6		$	28.1		$	74.0		$	(103.7	)

Condensed Consolidating Statements of Operations
Nine Months Ended September 30,
(in millions)
	Holdings			AAM Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Elims			Consolidated
2013
Net sales
External	$	—		$	574.2		$	170.5		$	1,631.3		$	—		$	2,376.0
Intercompany	—			13.0			169.1			9.0			(191.1		)	—
Total net sales	—			587.2			339.6			1,640.3			(191.1		)	2,376.0
Cost of goods sold	—			566.3			293.3			1,355.7			(191.1		)	2,024.2
Gross profit	—			20.9			46.3			284.6			—			351.8
Selling, general and administrative expenses	—			149.3			—			28.6			—			177.9
Operating income (loss)	—			(128.4		)	46.3			256.0			—			173.9
Non-operating income (expense), net	—			(101.4		)	7.9			(6.6		)	—			(100.1		)
Income (loss) before income taxes	—			(229.8		)	54.2			249.4			—			73.8
Income tax expense (benefit)	—			(13.0		)	—			22.1			—			9.1
Earnings (loss) from equity in subsidiaries	64.7			115.6			(14.4		)	—			(165.9		)	—
Net income (loss) before royalties and dividends	64.7			(101.2		)	39.8			227.3			(165.9		)	64.7
Royalties and dividends	—			165.9			—			(165.9		)	—			—
Net income after royalties and dividends	64.7			64.7			39.8			61.4			(165.9		)	64.7
Net loss attributable to noncontrolling interests	—			—			—			—			—			—
Net income attributable to AAM	$	64.7		$	64.7		$	39.8		$	61.4		$	(165.9	)	$	64.7
Other comprehensive loss	(0.8		)	(0.8		)	(14.4		)	(17.8		)	33.0			(0.8		)
Comprehensive income attributable to AAM	$	63.9		$	63.9		$	25.4		$	43.6		$	(132.9	)	$	63.9

	Holdings			AAM Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Elims			Consolidated
2012
Net sales
External	$	—		$	542.6		$	164.7		$	1,486.9		$	—		$	2,194.2
Intercompany	—			14.9			174.5			22.3			(211.7		)	—
Total net sales	—			557.5			339.2			1,509.2			(211.7		)	2,194.2
Cost of goods sold	—			544.7			298.3			1,247.2			(211.7		)	1,878.5
Gross profit	—			12.8			40.9			262.0			—			315.7
Selling, general and administrative expenses	—			148.2			—			29.7			—			177.9
Operating income (loss)	—			(135.4		)	40.9			232.3			—			137.8
Non-operating income (expense), net	—			(84.5		)	1.3			(3.0		)	—			(86.2		)
Income (loss) before income taxes	—			(219.9		)	42.2			229.3			—			51.6
Income tax expense	—			0.4			—			4.4			—			4.8
Earnings (loss) from equity in subsidiaries	47.8			133.8			(40.9		)	—			(140.7		)	—
Net income (loss) before royalties and dividends	47.8			(86.5		)	1.3			224.9			(140.7		)	46.8
Royalties and dividends	—			134.3			—			(134.3		)	—			—
Net income after royalties and dividends	47.8			47.8			1.3			90.6			(140.7		)	46.8
Net loss attributable to noncontrolling interests	—			—			—			1.0			—			1.0
Net income attributable to AAM	$	47.8		$	47.8		$	1.3		$	91.6		$	(140.7	)	$	47.8
Other comprehensive loss	(116.7		)	(116.7		)	(7.3		)	(1.0		)	125.0			(116.7		)
Foreign currency translation adjustments attributable to noncontrolling interests	0.2			0.2			—			0.2			(0.4		)	0.2
Comprehensive income (loss) attributable to AAM	$	(69.1	)	$	(69.1	)	$	(6.0	)	$	90.4		$	(15.3	)	$	(69.1	)

Condensed Consolidating Balance Sheets
(in millions)
	Holdings			AAM Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Elims			Consolidated
September 30, 2013
Assets
Current assets
Cash and cash equivalents	$	—		$	25.1		$	—		$	93.5	$	—		$	118.6
Accounts receivable, net	—			124.6			32.1			440.2		—			596.9
Inventories, net	—			55.1			32.3			164.1		—			251.5
Other current assets	—			43.6			3.7			77.4		—			124.7
Total current assets	—			248.4			68.1			775.2		—			1,091.7
Property, plant and equipment, net	—			244.0			80.4			717.4		—			1,041.8
Goodwill	—			—			147.8			8.7		—			156.5
Other assets and deferred charges	—			694.2			44.4			89.9		—			828.5
Investment in subsidiaries	277.3			1,193.9			0.3			—		(1,471.5		)	—
Total assets	$	277.3		$	2,380.5		$	341.0		$	1,591.2	$	(1,471.5	)	$	3,118.5
Liabilities and stockholders’ equity (deficit)
Current liabilities
Accounts payable	$	—		$	106.2		$	49.1		$	329.7	$	—		$	485.0
Other current liabilities	—			120.4			4.7			94.0		—			219.1
Total current liabilities	—			226.6			53.8			423.7		—			704.1
Intercompany payable (receivable)	324.1			(423.9		)	(209.3		)	309.1		—			—
Long-term debt	—			1,487.9			5.4			79.3		—			1,572.6
Other long-term liabilities	—			812.6			0.7			75.3		—			888.6
Total liabilities	324.1			2,103.2			(149.4		)	887.4		—			3,165.3
Total AAM Stockholders’ equity (deficit)	(46.8		)	277.3			490.4			703.8		(1,471.5		)	(46.8		)
Noncontrolling interests in subsidiaries	—			—			—			—		—			—
Total stockholders’ equity (deficit)	(46.8		)	277.3			490.4			703.8		(1,471.5		)	(46.8		)
Total liabilities and stockholders’ equity (deficit)	$	277.3		$	2,380.5		$	341.0		$	1,591.2	$	(1,471.5	)	$	3,118.5

	Holdings			AAM Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Elims			Consolidated
December 31, 2012
Assets
Current assets
Cash and cash equivalents	$	—		$	10.6		$	—		$	51.8	$	—		$	62.4
Accounts receivable, net	—			94.4			25.3			343.7		—			463.4
Inventories, net	—			48.7			31.6			144.0		—			224.3
Other current assets	—			48.8			3.5			69.7		—			122.0
Total current assets	—			202.5			60.4			609.2		—			872.1
Property, plant and equipment, net	—			250.4			84.2			675.1		—			1,009.7
Goodwill	—			—			147.8			8.6		—			156.4
Other assets and deferred charges	—			706.1			40.0			81.7		—			827.8
Investment in subsidiaries	202.9			1,094.6			—			—		(1,297.5		)	—
Total assets	$	202.9		$	2,253.6		$	332.4		$	1,374.6	$	(1,297.5	)	$	2,866.0
Liabilities and stockholders’ equity (deficit)
Current liabilities
Accounts payable	$	—		$	91.4		$	37.3		$	267.4	$	—		$	396.1
Other current liabilities	—			124.5			3.8			76.4		—			204.7
Total current liabilities	—			215.9			41.1			343.8		—			600.8
Intercompany payable (receivable)	323.7			(420.6		)	(188.7		)	285.6		—			—
Long-term debt	—			1,387.5			5.6			61.0		—			1,454.1
Investment in subsidiaries obligation	—			—			7.6			—		(7.6		)	—
Other long-term liabilities	—			867.9			1.2			62.8		—			931.9
Total liabilities	323.7			2,050.7			(133.2		)	753.2		(7.6		)	2,986.8
Total AAM Stockholders’ equity (deficit)	(120.8		)	202.9			465.6			621.4		(1,289.9		)	(120.8		)
Noncontrolling interests in subsidiaries	—			—			—			—		—			—
Total stockholders’ equity (deficit)	(120.8		)	202.9			465.6			621.4		(1,289.9		)	(120.8		)
Total liabilities and stockholders’ equity (deficit)	$	202.9		$	2,253.6		$	332.4		$	1,374.6	$	(1,297.5	)	$	2,866.0

Condensed Consolidating Statements of Cash Flows
Nine Months Ended September 30,
(in millions)
	Holdings			AAM Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Elims		Consolidated
2013
Net cash provided by (used in) operating activities	$	—		$	(52.6	)	$	67.7		$	87.2		$	—	$	102.3
Investing activities
Purchases of property, plant and equipment	—			(43.6		)	(7.0		)	(127.6		)	—		(178.2		)
Proceeds from sale of equipment	—			4.9			0.5			0.4			—		5.8
Proceeds from sale-leaseback of equipment	—			23.5			—			—			—		23.5
Net cash used in investing activities	—			(15.2		)	(6.5		)	(127.2		)	—		(148.9		)
Financing activities
Net debt activity	—			97.0			(0.2		)	19.0			—		115.8
Intercompany activity	0.4			(2.6		)	(61.0		)	63.2			—		—
Debt issuance costs	—			(12.9		)	—			—			—		(12.9		)
Employee stock option exercises	—			0.8			—			—			—		0.8
Purchase of treasury stock	(0.4		)	—			—			—			—		(0.4		)
Net cash provided by (used in) financing activities	—			82.3			(61.2		)	82.2			—		103.3
Effect of exchange rate changes on cash	—			—			—			(0.5		)	—		(0.5		)
Net increase in cash and cash equivalents	—			14.5			—			41.7			—		56.2
Cash and cash equivalents at beginning of period	—			10.6			—			51.8			—		62.4
Cash and cash equivalents at end of period	$	—		$	25.1		$	—		$	93.5		$	—	$	118.6

	Holdings			AAM Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Elims		Consolidated
2012
Net cash provided by (used in) operating activities	$	—		$	(276.8	)	$	42.3		$	37.9		$	—	$	(196.6	)
Investing activities
Purchases of property, plant and equipment	—			(36.2		)	(6.2		)	(101.3		)	—		(143.7		)
Proceeds from sale of equipment	—			0.5			—			1.7			—		2.2
Net cash used in investing activities	—			(35.7		)	(6.2		)	(99.6		)	—		(141.5		)
Financing activities
Net debt activity	—			409.6			(0.2		)	(12.4		)	—		397.0
Intercompany activity	5.9			(19.0		)	(35.9		)	49.0			—		—
Purchase of noncontrolling interest	—			—			—			(4.0		)	—		(4.0		)
Debt issuance costs	—			(10.1		)	—			—			—		(10.1		)
Employee stock option exercises	—			0.1			—			—			—		0.1
Purchase of treasury stock	(5.9		)	—			—			—			—		(5.9		)
Net cash provided by (used in) financing activities	—			380.6			(36.1		)	32.6			—		377.1
Effect of exchange rate changes on cash	—			—			—			0.8			—		0.8
Net increase (decrease) in cash and cash equivalents	—			68.1			—			(28.3		)	—		39.8
Cash and cash equivalents at beginning of period	—			83.7			—			85.5			—		169.2
Cash and cash equivalents at end of period	$	—		$	151.8		$	—		$	57.2		$	—	$	209.0