OREANDA-NEWS.  American Axle & Manufacturing Holdings, Inc. (AAM), (NYSE: AXL) today reported its financial results for the first quarter of 2016 and announced a share repurchase program.

First Quarter 2016 Results

  • Sales of $969.2 million
  • Non-GM sales of $323.2 million
  • Gross profit of $174.0 million, or 18.0% of sales
  • Net income of $61.1 million, or $0.78 per share
  • EBITDA (earnings before interest, income taxes, depreciation and amortization) of $149.8 million, or 15.5% of sales

AAM's net income in the first quarter of 2016 was $61.1 million, or $0.78 per share, as compared to net income of $53.2 million, or $0.68 per share, in the first quarter of 2015.

"Our strong first quarter financial results position AAM to achieve our full year 2016 financial targets," said David C. Dauch, AAM's Chairman and Chief Executive Officer. "As we look forward to the remainder of 2016, we remain focused on supporting the launch of programs in our new business backlog and advancing AAM's product technology to drive long-term profitable growth and shareholder value."

AAM's sales in the first quarter of 2016 were $969.2 million as compared to $969.1 million in the first quarter of 2015. Non-GM sales were $323.2 million in the first quarter of 2016 as compared to $328.9 million in the first quarter of 2015.

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 first quarter of 2016, AAM's content-per-vehicle was $1,611 as compared to $1,676 in the first quarter of 2015. 

AAM's gross profit in the first quarter of 2016 increased $21.2 million to $174.0 million, or 18.0% of sales, as compared to $152.8 million, or 15.8% of sales, in the first quarter of 2015.

AAM's SG&A spending in the first quarter of 2016 was $75.6 million, or 7.8% of sales, as compared to $68.5 million, or 7.1% of sales, in the first quarter of 2015. AAM's R&D spending in the first quarter of 2016 was $30.9 million as compared to $27.3 million in the first quarter of 2015.

AAM defines EBITDA to be earnings before interest, income taxes, depreciation and amortization.  In the first quarter of 2016, AAM's EBITDA was $149.8 million, or 15.5% of sales, as compared to $137.5 million, or 14.2% of sales, in the first quarter of 2015.

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.

Net cash provided by operating activities for the first quarter of 2016 was $26.2 million.  Capital spending, net of proceeds from the sale of property, plant and equipment, for the first quarter of 2016 was $50.0 million.  Reflecting the impact of this activity, AAM's free cash flow was a use of $23.8 million for the first quarter of 2016. 

Share Repurchase Program
AAM announced today that the Board of Directors authorized a share repurchase program of up to $100 million of AAM's common shares through December 31, 2018 as part of AAM's overall capital allocation strategy. "The authorization of a share repurchase program by the Board of Directors demonstrates the confidence in AAM's long-term growth and strong free cash flow generation as well as our commitment to create and deliver value to our shareholders," said Dauch.

The repurchase of shares may be made in the open market or in privately negotiated transactions and will be funded through available cash balances and cash flow from operations. The timing and amount of any share repurchases will be determined based on market and economic conditions, share price, alternative uses of capital and other factors.

AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)
   
 

Three Months Ended
 

March 31,
 

2016

  

2015
 

(in millions, except per share data)
       

Net sales

$

969.2

    

$

969.1

  
       

Cost of goods sold

795.2

    

816.3

  
       

Gross profit

174.0

    

152.8

  
       

Selling, general and administrative expenses

75.6

    

68.5

  
       

Operating income

98.4

    

84.3

  
       

Interest expense

(23.6)

    

(25.1)

  
       

Investment income

0.6

    

0.8

  
       

Other income, net

1.0

    

2.4

  
       

Income before income taxes

76.4

    

62.4

  
       

Income tax expense

15.3

    

9.2

  
       

Net income

$

61.1

    

$

53.2

  
       

Diluted earnings per share

$

0.78

    

$

0.68

  
       

AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)
   
 

Three Months Ended
 

March 31,
 

2016

  

2015
 

(in millions)
       

Net income

$

61.1

    

$

53.2

  
       

Other comprehensive income (loss)

      

Defined benefit plans, net of tax

4.2

    

3.9

  

Foreign currency translation adjustments

15.0

    

(31.5)

  

Changes in cash flow hedges

3.4

    

(0.5)

  

Other comprehensive income (loss)

22.6

    

(28.1)

  
       

Comprehensive income

$

83.7

    

$

25.1

  
       

AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)
       
 

March 31,
 2016

  

December 31,
2015
 

(in millions)

ASSETS

      

Current Assets

      

Cash and cash equivalents

$

262.0

    

$

282.5

  

Accounts receivable, net

643.9

    

539.1

  

Inventories, net

229.7

    

230.5

  

Prepaid expenses and other

79.4

    

72.1

  

Total current assets

1,215.0

    

1,124.2

  
       

Property, plant and equipment, net

1,063.5

    

1,046.2

  

Deferred income taxes

364.2

    

373.6

  

Goodwill

154.7

    

154.4

  

GM postretirement cost sharing asset

239.0

    

243.2

  

Other assets and deferred charges

269.4

    

261.1

  

Total assets

$

3,305.8

    

$

3,202.7

  
       

LIABILITIES AND STOCKHOLDERS' EQUITY

      

Current Liabilities

      

Current portion of long-term debt

$

3.4

    

$

3.3

  

Accounts payable

483.4

    

412.7

  

Accrued compensation and benefits

101.5

    

128.0

  

Deferred revenue

23.9

    

22.9

  

Accrued expenses and other

105.6

    

132.3

  

Total current liabilities

717.8

    

699.2

  
       

Long-term debt, net

1,382.1

    

1,375.7

  

Deferred revenue

60.8

    

65.7

  

Postretirement benefits and other long-term liabilities

758.2

    

760.6

  

Total liabilities

2,918.9

    

2,901.2

  
       

Total stockholders' equity

386.9

    

301.5

  

Total liabilities and stockholders' equity

$

3,305.8

    

$

3,202.7

  

AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)
         
         
   

Three Months Ended
   

March 31,
   

2016

  

2015
   

(in millions)

Operating Activities

        

Net income

  

$

61.1

    

$

53.2

  

Adjustments to reconcile net income to net cash provided by operating activities

        

   Depreciation and amortization

  

49.8

    

50.0

  

   Other

  

(84.7)

    

(96.8)

  

Net cash provided by operating activities

  

26.2

    

6.4

  
         

Investing Activities

        

Purchases of property, plant & equipment

  

(50.6)

    

(43.6)

  

Proceeds from sale of property, plant & equipment

  

0.6

    

0.1

  

Net cash used in investing activities

  

(50.0)

    

(43.5)

  
         

Financing Activities

        

Net debt activity

  

4.6

    

(1.2)

  

Purchase of treasury stock

  

(3.5)

    

(0.3)

  

Employee stock option exercises

  

—

    

0.4

  

Net cash provided by (used in) financing activities

  

1.1

    

(1.1)

  
         

Effect of exchange rate changes on cash

  

2.2

    

(5.3)

  
         

Net decrease in cash and cash equivalents

  

(20.5)

    

(43.5)

  
         

Cash and cash equivalents at beginning of period

  

282.5

    

249.2

  
         

Cash and cash equivalents at end of period

  

$

262.0

    

$

205.7

  

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, depreciation and amortization (EBITDA)(a)
 
 
 

Three Months Ended
 

March 31,
 

2016

  

2015
 

(in millions)
       

Net income

$

61.1

    

$

53.2

  

Interest expense

23.6

    

25.1

  

Income tax expense

15.3

    

9.2

  

Depreciation and amortization

49.8

    

50.0

  

EBITDA

$

149.8

    

$

137.5

  
       
       
 

Net debt(b) to capital
 
       
 

March 31, 2016

  

December 31, 2015
 

(in millions, except percentages)
       

Current portion of long-term debt

$

3.4

    

$

3.3

  

Long-term debt, net

1,382.1

    

1,375.7

  

Total debt, net

1,385.5

    

1,379.0

  

Less: cash and cash equivalents

262.0

    

282.5

  

Net debt at end of period

1,123.5

    

1,096.5

  

Stockholders' equity

386.9

    

301.5

  

Total invested capital at end of period

$

1,510.4

    

$

1,398.0

  
       

Net debt to capital(c)

74.4

%

  

78.4

%

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.
 

Free Cash Flow(d)
   
 

Three Months Ended
 

March 31,
 

2016

  

2015
 

(in millions)
       

Net cash provided by operating activities

$

26.2

    

$

6.4

  

Less: Purchases of property, plant & equipment, net of proceeds from sale of property, plant & equipment

(50.0)

    

(43.5)

  

Free cash flow

$

(23.8)

    

$

(37.1)