1-14303 | 38-3161171 | |
(Commission File Number) | (IRS Employer Identification No.) | |
One Dauch Drive, Detroit, Michigan | 48211-1198 | |
(Address of Principal Executive Offices) | (Zip Code) |
(313) 758-2000 |
(Registrant's Telephone Number, Including Area Code) |
(Former Name or Former Address, if Changed Since Last Report) |
• | AAM is targeting full year sales of approximately $4 billion to $4.1 billion in 2015. This sales projection is based on the anticipated launch schedule of programs in AAM's new and incremental business backlog and the assumption that the U.S. Seasonally Adjusted Annual Rate of sales ("SAAR") is in the range of 16.5 million to 17.0 million light vehicle units for the full year 2015. |
• | AAM is targeting EBITDA in the range of $550 million to $575 million in 2015 (13.75% to 14.00% of sales). |
• | AAM is targeting free cash flow in the range of $175 million to $200 million in 2015. |
• | AAM is targeting full year capital spending of approximately 5% of sales in 2015. |
• | AAM is targeting annual sales to grow at a compounded annual growth rate in excess of 5% during the period from 2015 - 2017. This sales projection is based on the anticipated launch schedule of programs in AAM's new and incremental business backlog and the assumption that the U.S. Seasonally Adjusted Annual Rate of sales ("SAAR") averages approximately 17.0 million light vehicle units during the period from 2015 to 2017. |
• | AAM is targeting EBITDA margin in the range of 13% to 14% during the period from 2015 to 2017. |
• | AAM’s target for the difference between EBITDA and capital spending during the period from 2015 to 2017 is in the range of 8% to 9% of sales. |
• | AAM is targeting free cash flow in the range of 4% to 5% of sales during the period from 2015 to 2017. |
• | AAM expects non-GM sales to range from 40% - 45% of total sales during the period from 2015 to 2017. |
Exhibit No. | Description | ||
99.1 | Press release dated | February 23, 2015 |
AMERICAN AXLE & MANUFACTURING HOLDINGS, INC. | |||||
Date: | February 23, 2015 | By: | /s/ Michael K. Simonte | ||
Michael K. Simonte | |||||
Executive Vice President & Chief Financial Officer (also in the capacity of Chief Accounting Officer) |
• | Fourth quarter 2014 sales of $939.5 million, up approximately 13% on a year-over-year basis |
• | Non-GM sales grew over 13% on a year-over-year basis to $317.2 million |
• | Gross profit of $111.2 million, or 11.8% of sales |
• | Net income of $13.2 million, or $0.17 per share |
• | AAM's quarterly results reflect a non-cash charge of $35.5 million related to a voluntary one-time lump sum cash payment to certain eligible terminated vested participants in our U.S. pension plans (2014 Pension Payout Offer) |
• | Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, excluding the impact of the non-cash charge related to the 2014 Pension Payout Offer) of $135.1 million, or 14.4% of sales |
• | Free cash flow (net cash provided by operating activities less capital expenditures net of proceeds from the sale of property, plant and equipment and government grants) of $39.2 million |
• | Full year 2014 sales of $3.7 billion, up approximately 15% on a year-over-year basis |
• | Non-GM sales grew nearly 30% on a year-over-year basis to $1.2 billion |
• | Gross profit of $522.8 million, or 14.1% of sales |
• | Net income of $143.0 million, or $1.85 per share |
• | Adjusted EBITDA of $512.0 million, or 13.9% of sales |
• | Free cash flow of $123.1 million |
Three months ended | Twelve months ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
(in millions, except per share data) | (in millions, except per share data) | ||||||||||||||
Net sales | $ | 939.5 | $ | 831.3 | $ | 3,696.0 | $ | 3,207.3 | |||||||
Cost of goods sold | 828.3 | 704.4 | 3,173.2 | 2,728.6 | |||||||||||
Gross profit | 111.2 | 126.9 | 522.8 | 478.7 | |||||||||||
Selling, general and administrative expenses | 72.6 | 60.5 | 255.2 | 238.4 | |||||||||||
Operating income | 38.6 | 66.4 | 267.6 | 240.3 | |||||||||||
Interest expense | (24.7 | ) | (28.0 | ) | (99.9 | ) | (115.9 | ) | |||||||
Investment income | 0.8 | 0.2 | 2.1 | 0.6 | |||||||||||
Other income (expense) | |||||||||||||||
Debt refinancing and redemption costs | — | (25.6 | ) | — | (36.8 | ) | |||||||||
Other, net | 6.4 | (0.5 | ) | 6.9 | (1.9 | ) | |||||||||
Income before income taxes | 21.1 | 12.5 | 176.7 | 86.3 | |||||||||||
Income tax expense (benefit) | 7.9 | (17.3 | ) | 33.7 | (8.2 | ) | |||||||||
Net income | $ | 13.2 | $ | 29.8 | $ | 143.0 | $ | 94.5 | |||||||
Diluted earnings per share | $ | 0.17 | $ | 0.39 | $ | 1.85 | $ | 1.23 | |||||||
Three months ended | Twelve months ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
(in millions) | |||||||||||||||
Net income | $ | 13.2 | $ | 29.8 | $ | 143.0 | $ | 94.5 | |||||||
Other comprehensive income (loss), net of tax | |||||||||||||||
Defined benefit plans, net of tax | (49.0 | ) | 60.9 | (42.7 | ) | 76.6 | |||||||||
Foreign currency translation adjustments | (18.4 | ) | (11.9 | ) | (30.3 | ) | (26.2 | ) | |||||||
Change in derivatives | (6.6 | ) | 0.2 | (7.7 | ) | (2.0 | ) | ||||||||
Other comprehensive income (loss ) | (74.0 | ) | 49.2 | (80.7 | ) | 48.4 | |||||||||
Comprehensive income (loss) | $ | (60.8 | ) | $ | 79.0 | $ | 62.3 | $ | 142.9 |
December 31, 2014 | December 31, 2013 | ||||||
(in millions) | |||||||
ASSETS | |||||||
Current Assets | |||||||
Cash and cash equivalents | $ | 249.2 | $ | 154.0 | |||
Accounts receivable, net | 532.7 | 458.5 | |||||
Inventories, net | 248.8 | 261.8 | |||||
Deferred income taxes | 40.2 | 34.9 | |||||
Prepaid expenses and other current assets | 68.6 | 87.1 | |||||
Total current assets | 1,139.5 | 996.3 | |||||
Property, plant and equipment, net | 1,061.1 | 1,058.5 | |||||
Deferred income taxes | 368.8 | 341.8 | |||||
Goodwill | 155.0 | 156.4 | |||||
GM postretirement cost sharing asset | 274.5 | 242.0 | |||||
Other assets and deferred charges | 260.3 | 232.5 | |||||
Total assets | $ | 3,259.2 | $ | 3,027.5 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current Liabilities | |||||||
Current portion of long-term debt | $ | 13.0 | $ | — | |||
Accounts payable | 444.3 | 437.4 | |||||
Accrued compensation and benefits | 109.1 | 110.1 | |||||
Deferred revenue | 22.1 | 17.0 | |||||
Deferred income taxes | 0.1 | 0.1 | |||||
Accrued expenses and other current liabilities | 98.6 | 94.1 | |||||
Total current liabilities | 687.2 | 658.7 | |||||
Long-term debt | 1,523.4 | 1,559.1 | |||||
Deferred income taxes | 9.1 | 9.8 | |||||
Deferred revenue | 94.2 | 76.4 | |||||
Postretirement benefits and other long-term liabilities | 831.9 | 683.0 | |||||
Total liabilities | 3,145.8 | 2,987.0 | |||||
Total stockholders' equity | 113.4 | 40.5 | |||||
Total liabilities and stockholders' equity | $ | 3,259.2 | $ | 3,027.5 |
Three months ended | Twelve months ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
(in millions) | (in millions) | |||||||||||||||
Operating Activities | ||||||||||||||||
Net income | $ | 13.2 | $ | 29.8 | $ | 143.0 | $ | 94.5 | ||||||||
Adjustments to reconcile net income to net cash provided by operating activities | ||||||||||||||||
Depreciation and amortization | 53.8 | 47.6 | 199.9 | 177.0 | ||||||||||||
Other | 19.8 | 43.3 | (24.5 | ) | (48.5 | ) | ||||||||||
Net cash provided by operating activities | 86.8 | 120.7 | 318.4 | 223.0 | ||||||||||||
Investing Activities | ||||||||||||||||
Purchases of property, plant & equipment | (50.3 | ) | (73.7 | ) | (206.5 | ) | (251.9 | ) | ||||||||
Proceeds from sale of property, plant & equipment | 0.6 | 3.3 | 9.1 | 9.1 | ||||||||||||
Proceeds from sale-leaseback of equipment | — | 0.6 | — | 24.1 | ||||||||||||
Proceeds from government grants | 2.1 | — | 2.1 | — | ||||||||||||
Net cash used in investing activities | (47.6 | ) | (69.8 | ) | (195.3 | ) | (218.7 | ) | ||||||||
Financing Activities | ||||||||||||||||
Net increase (decrease) in long-term debt and other | (5.3 | ) | (11.0 | ) | (22.0 | ) | 104.8 | |||||||||
Debt issuance costs | — | (3.8 | ) | (0.3 | ) | (16.7 | ) | |||||||||
Purchase of treasury stock | — | — | (0.3 | ) | (0.4 | ) | ||||||||||
Employee stock option exercises | — | 0.3 | 1.2 | 1.1 | ||||||||||||
Net cash provided by (used in) financing activities | (5.3 | ) | (14.5 | ) | (21.4 | ) | 88.8 | |||||||||
Effect of exchange rate changes on cash | (3.7 | ) | (1.0 | ) | (6.5 | ) | (1.5 | ) | ||||||||
Net increase in cash and cash equivalents | 30.2 | 35.4 | 95.2 | 91.6 | ||||||||||||
Cash and cash equivalents at beginning of period | 219.0 | 118.6 | 154.0 | 62.4 | ||||||||||||
Cash and cash equivalents at end of period | $ | 249.2 | $ | 154.0 | $ | 249.2 | $ | 154.0 |
Three months ended | Twelve months ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
(in millions) | (in millions) | ||||||||||||||
Net income | $ | 13.2 | $ | 29.8 | $ | 143.0 | $ | 94.5 | |||||||
Interest expense | 24.7 | 28.0 | 99.9 | 115.9 | |||||||||||
Income tax expense (benefit) | 7.9 | (17.3 | ) | 33.7 | (8.2 | ) | |||||||||
Depreciation and amortization | 53.8 | 47.6 | 199.9 | 177.0 | |||||||||||
EBITDA | 99.6 | 88.1 | 476.5 | 379.2 | |||||||||||
Debt refinancing and redemption costs | — | 25.6 | — | 36.8 | |||||||||||
Other special charges and restructuring costs(b) | 35.5 | — | 35.5 | 5.8 | |||||||||||
ADJUSTED EBITDA | $ | 135.1 | $ | 113.7 | $ | 512.0 | $ | 421.8 |
December 31, 2014 | December 31, 2013 | ||||||
(in millions, except percentages) | |||||||
Total debt | $ | 1,536.4 | $ | 1,559.1 | |||
Less: cash and cash equivalents | 249.2 | 154.0 | |||||
Net debt at end of period | 1,287.2 | 1,405.1 | |||||
Stockholders' equity | 113.4 | 40.5 | |||||
Total invested capital at end of period | $ | 1,400.6 | $ | 1,445.6 | |||
Net debt to capital(d) | 91.9 | % | 97.2 | % |
Three months ended | Twelve months ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
(in millions) | (in millions) | ||||||||||||||
Net cash provided by operating activities | $ | 86.8 | $ | 120.7 | $ | 318.4 | $ | 223.0 | |||||||
Less: Capital expenditures net of proceeds from the sale of property, plant & equipment, the sale-leaseback of equipment and government grants | (47.6 | ) | (69.8 | ) | (195.3 | ) | (218.7 | ) | |||||||
Free cash flow | $ | 39.2 | $ | 50.9 | $ | 123.1 | $ | 4.3 |
(a) | We define EBITDA to be earnings before interest, taxes, depreciation and amortization. For 2014, adjusted EBITDA is defined as EBITDA excluding the impact of the non-cash charge associated with a voluntary one-time lump sum cash payment to certain eligible terminated vested participants in our U.S. pension plans in the fourth quarter of 2014 (“the 2014 Pension Payout Offer”). For 2013, Adjusted EBITDA is defined as EBITDA excluding the impact of debt refinancing and redemption costs and other special charges and restructuring costs. 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) | Special charges of $35.5 million for the three and twelve months ended December 31, 2014 relate to the 2014 Pension Payout Offer. Special charges of $5.8 million for the twelve months ended December 31, 2013 primarily relate to a net charge of $5.3 million related to the acceleration of expense for stock-based compensation and other benefits earned and vested due to the passing of our Co-Founder and Executive Chairman of the Board of Directors and $0.5 million for the settlement of a National Labor Relations Board proceeding related to the closure of our Detroit Manufacturing Complex and Cheektowaga Manufacturing Facility. |
(c) | Net debt is equal to total debt less cash and cash equivalents. |
(d) | Net debt to capital is equal to net debt divided by the sum of stockholders' equity 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. |
(e) | We define free cash flow to be net cash provided by (or used in) operating activities less capital expenditures net of proceeds from the sale of property, plant and equipment, the sale-leaseback of equipment and government grants. 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. |
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