American Axle & Manufacturing Holdings, Inc. (AAM), which is traded as AXL on the NYSE, today reported its financial results for the second quarter 2013.
Second Quarter 2013 Results
- Second quarter 2013 sales of $799.6 million, up 8.1% on a year-over-year basis
- Non-GM sales grew 12.9% on a year-over-year basis to $223.8 million
- Gross profit of $122.2 million, or 15.3% of sales
- Operating income of $61.7 million, or 7.7% of sales
- Net income of $25.8 million, or $0.34 per share
- Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization excluding the impact of non-recurring or extraordinary items) of $102.3 million or approximately 12.8% of sales
AAM’s net income in the second quarter of 2013 was $25.8 million, or $0.34 per share. This compares to net income of $4.7 million or $0.06 per share in the second quarter of 2012. In the second quarter of 2012, AAM’s results reflected the impact of special charges and restructuring costs of $36.5 million (or $0.49 per share), related to the closure of our Detroit Manufacturing Complex and Cheektowaga Manufacturing Facility.
“AAM is pleased to report solid sequential sales growth and improved profitability in the second quarter of 2013,” said AAM’s President and Chief Executive Officer, David C. Dauch. “AAM is benefiting from a strong recovery in the North American light truck market, as well as the launch of many new products designed to help our global customer base increase fuel efficiency, reduce emissions and improve safety, ride and handling performance. The combination of these factors and the continued progress in our operational efficiency position us to continue improving AAM’s financial performance in the second half of 2013.”
Net sales in the second quarter of 2013 increased approximately 8.1% to $799.6 million as compared to $739.8 million in the second quarter of 2012. Non-GM sales were up 12.9% to $223.8 million in the second quarter of 2013 as compared to $198.2 million in the second quarter of 2012.
AAM’s net sales in the first half of 2013 increased approximately 4.7% to $1.56 billion as compared to $1.49 billion in the first half of 2012. Non-GM sales in the first half of 2013 increased approximately 5.1% on a year-over-year basis to $411.9 million as compared to $391.8 million in the first half of 2012.
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 second quarter of 2013, AAM’s content-per-vehicle increased to $1,554 as compared to $1,439 in the second quarter of 2012 and $1,504 million in the first quarter of 2013.
AAM’s gross profit in the second quarter of 2013 was $122.2 million or 15.3% of sales. For the second quarter of 2012, AAM’s gross profit was $85.8 million or 11.6% of sales.
AAM’s gross profit for the first half of 2013 was $226.5 million as compared to $225.0 million in the first half of 2012. Gross margin was 14.6% in the first half of 2013 as compared to 15.1% in the first half of 2012.
AAM’s SG&A spending in the second quarter of 2013 was $60.5 million, or 7.6% of sales, as compared to $55.5 million, or 7.5% of sales, in the second quarter of 2012. AAM’s R&D spending in the second quarter of 2013 was $27.3 million as compared to $28.8 million in the second quarter of 2012.
In the first half of 2013, AAM’s SG&A spending was $120.1 million as compared to $117.3 million in the first half of 2012. AAM’s R&D spending decreased $3.1 million in the first half of 2013 on a year-over-year basis to $55.8 million as compared to $58.9 million in the first half of 2012.
In the second quarter of 2013, AAM’s operating income was $61.7 million or 7.7% of sales as compared to $30.3 million or 4.1% of sales in the second quarter of 2012.
AAM’s operating income in the first half of 2013 was $106.4 million as compared to $107.7 million in the first half of 2012. Operating margin was 6.8% in the first half of 2013 as compared to 7.2% in the first half of 2012.
In the second quarter of 2013, AAM’s net income was $25.8 million or $0.34 per share. For the second quarter of 2012, AAM’s net income was $4.7 million or $0.06 per share.
AAM defines Adjusted EBITDA to be earnings before interest, taxes, depreciation and amortization excluding the impact of debt refinancing and redemption costs. In the second quarter of 2013, AAM’s Adjusted EBITDA was $102.3 million or 12.8% of sales. In the first half of 2013, AAM’s Adjusted EBITDA was $188.9 million or 12.1% of sales.
AAM defines free cash flow to be net cash provided by operating activities less capital expenditures net of proceeds from the sale of property, plant and equipment and the sale-leaseback of equipment.
Net cash provided by operating activities for the second quarter 2013 was $60.0 million. Capital spending, net of proceeds from the sale of property, plant and equipment and the sale-leaseback of equipment, for the second quarter 2013 was $56.7 million. Reflecting the impact of this activity, AAM generated free cash flow of $3.3 million for the second quarter 2013.
Net cash provided by operating activities for the first half of 2013 was $33.2 million. Capital spending, net of proceeds from the sale of property, plant and equipment and the sale-leaseback of equipment, for the first half of 2013 was $100.6 million. Reflecting the impact of this activity, AAM’s free cash flow was a use of $67.4 million in the first half of 2013.
A conference call to review AAM’s second quarter 2013 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 (855) 681-2072 from the United States or (973) 200-3383 from outside the United States. A replay will be available from 5:00 p.m. ET on August 2, 2013 until 5:00 p.m. ET August 9, 2013 by dialing (855) 859-2056 from the United States or (404) 537-3406 from outside the United States. When prompted, callers should enter conference reservation number 14713803.
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 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.
