AAM Statement on the Passing of AAM Co-Founder Mort Harris
AAM Reports First Quarter 2021 Financial Results
DETROIT, May 7, 2021 -- American Axle & Manufacturing Holdings, Inc. (AAM), (NYSE: AXL) today reported its financial results for the first quarter 2021.
First Quarter 2021 Results
“In the first quarter of 2021, AAM delivered solid operating performance and cash flow generation,” said AAM’s Chairman and Chief Executive Officer, David C. Dauch. “Although the industry is facing continuity of supply issues, we continue to navigate through these challenges while delivering strong results. In addition to driving operational excellence and managing our cost structure, we continue to make strategic investments and establish technical partnerships to support the industry shift towards electrification.”
AAM's sales in the first quarter of 2021 were $1.43 billion as compared to $1.34 billion in the first quarter of 2020. AAM estimates sales for the first quarter of 2021 were unfavorably impacted by the semiconductor chip shortage by approximately $64 million.
AAM's net income in the first quarter of 2021 was $38.6 million, or $0.33 per share, as compared to a net loss of $(501.3) million, or $(4.45) per share in the first quarter of 2020.
AAM defines Adjusted earnings per share to be diluted earnings per share excluding the impact of restructuring and acquisition-related costs, debt refinancing and redemption costs, loss on sale of business, impairment charges, pension settlements, certain accelerated depreciation, and non-recurring items, including the tax effect thereon. Adjusted earnings per share in the first quarter of 2021 were $0.57 compared to $0.20 in the first quarter of 2020.
AAM defines EBITDA to be earnings before interest expense, income taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA excluding the impact of restructuring and acquisition-related costs, debt refinancing and redemption costs, loss on sale of business, impairment charges, pension settlements and non-recurring items. In the first quarter of 2021, Adjusted EBITDA was $262.9 million, or 18.4% of sales, as compared to $213.3 million, or 15.9% of sales, in the first quarter of 2020. AAM estimates Adjusted EBITDA in the first quarter of 2021 was unfavorably impacted by lower sales as a result of the semiconductor shortage by approximately $21 million.
AAM's net cash provided by operating activities for the first quarter of 2021 was $179.1 million as compared to $139.4 million for the first quarter of 2020.
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. Adjusted free cash flow is defined as free cash flow excluding the impact of cash payments for restructuring and acquisition-related costs, and cash payments related to the Malvern fire net of recoveries. AAM's Adjusted free cash flow for the first quarter of 2021 was $174.1 million as compared to $83.3 million for the first quarter of 2020.
AAM's 2021 Financial Outlook
AAM’s previously stated full year 2021 targets remain unchanged. Based on current production forecasts and customer prioritization of full-size trucks and SUVs, we project that we are currently trending toward the high-end of our ranges.
AAM is targeting sales in the range of $5.3 - $5.5 billion
These targets are based on the following industry production assumption for 2021:
North American light vehicle production in the range of 15.0 - 15.5 million units
AAM’s full year 2021 financial targets are based on current customer production and launch schedules and operating environment.
First Quarter 2021 Conference Call Information
A conference call to review AAM's first quarter 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 (877) 883-0383 from the United States or (412) 902-6506 from outside the United States with access code 2878464. A replay will be available one hour after the call is complete until May 14, 2021 by dialing (877) 344-7529 from the United States or (412) 317-0088 from outside the United States. When prompted, callers should enter replay access code 10152565.
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 as Adjusted EBITDA, Adjusted earnings per share and Adjusted free cash flow. 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.
Certain of the forward-looking financial measures included in this earnings release are provided on a non-GAAP basis. A reconciliation of non-GAAP forward-looking financial measures to the most directly comparable forward-looking financial measures calculated and presented in accordance with GAAP has been provided. The amounts in these reconciliations are based on our current estimates and actual results may differ materially from these forward-looking estimates for many reasons, including potential event driven transactional and other non-core operating items and their related effects in any future period, the magnitude of which may be significant.
Management believes that these non-GAAP financial measures are useful to management, investors, and banking institutions 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 (NYSE: AXL) delivers POWER that moves the world. As a leading global tier 1 automotive supplier, AAM designs, engineers and manufactures driveline and metal forming technologies that are making the next generation of vehicles smarter, lighter, safer and more efficient. Headquartered in Detroit, AAM has approximately 20,000 associates operating at nearly 80 facilities in 17 countries to support our customers on global and regional platforms with a focus on quality, operational excellence and technology leadership. To learn more, visit aam.com.
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,” "target," and similar words or 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: significant disruptions in production, sales and/or supply as a result of public health crises, including pandemic or epidemic illness such as Novel Coronavirus (COVID-19), or otherwise; global economic conditions; reduced purchases of our products by General Motors Company (GM), Stellantis N.V. (Stellantis), Ford Motor Company (Ford) or other customers; our ability to respond to changes in technology, increased competition or pricing pressures; 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 attract new customers and programs for new products; reduced demand for our customers' products (particularly light trucks and sport utility vehicles (SUVs) produced by GM, Stellantis and Ford); risks inherent in our global operations (including tariffs and the potential consequences thereof to us, our suppliers, and our customers and their suppliers, adverse changes in trade agreements, such as the United States-Mexico-Canada Agreement (USMCA), immigration policies, political stability, taxes and other law changes, potential disruptions of production and supply, and currency rate fluctuations); a significant disruption in operations at one or more of our key manufacturing facilities; negative or unexpected tax consequences; risks related to a failure of our information technology systems and networks, and risks associated with current and emerging technology threats and damage from computer viruses, unauthorized access, cyber attacks and other similar disruptions; supply shortages, such as the semiconductor shortage that the automotive industry is currently experiencing, or price increases in raw material and/or freight, utilities or other operating supplies for us or our customers as a result of pandemics, natural disasters or otherwise; availability of financing for working capital, capital expenditures, research and development (R&D) or other general corporate purposes including acquisitions, as well as 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; an impairment of our goodwill, other intangible assets, or long-lived assets if our business or market conditions indicate that the carrying values of those assets exceed their fair values; liabilities arising from warranty claims, product recall or field actions, product liability and legal proceedings to which we are or may become a party, or the impact of product recall or field actions on our customers; our ability or our customers' and suppliers' ability to successfully launch new product programs on a timely basis; 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; our ability to achieve the level of cost reductions required to sustain global cost competitiveness; our ability to realize the expected revenues from our new and incremental business backlog; price volatility in, or reduced availability of, fuel; our ability to protect our intellectual property and successfully defend against assertions made against us; risks of noncompliance with environmental laws and regulations or risks of environmental issues that could result in unforeseen costs at our facilities or reputational damage; adverse changes in laws, government regulations or market conditions affecting our products or our customers' products; our ability or our customers' and suppliers' ability to comply with regulatory requirements and the potential costs of such compliance; changes in liabilities arising from pension and other postretirement benefit obligations; our ability to attract and retain key associates; and other unanticipated events and conditions that may hinder our ability to compete. It is not possible to foresee or identify all such factors and any or all of the foregoing factors may be exacerbated by COVID-19. Further, 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.
On this website and elsewhere in attached materials, 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,” "target," and similar words or 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:
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.
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Use of AAM Website
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AAM reserves the right, at its sole discretion, to change, modify, add, or remove portions of these Terms at any time. All such changes to these Terms will appear on this page. By using the website following any modifications to these Terms, you agree to be bound by any such modifications. Unless explicitly stated otherwise, any new features to the current website shall be subject to these Terms.
Other than personally identifiable information, any material, information or other communication you transmit or post to this website will be considered non-confidential and non-proprietary ("Communications"). Your act of transmission or posting will signify your recognition that AAM will have no obligations with respect to the Communications. AAM and its designees may copy, disclose, distribute, incorporate and otherwise use the Communications and all data, images, sounds, text, and other things embodied therein for any and all commercial or non-commercial purposes.
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AAM and its suppliers will not be liable for any damages whatsoever arising out of the use of this website, information, data or services contained on this website or any link to this site, including, without limitation, those resulting from lost profits, lost data or business interruption, whether such damages are based on warranty, contract, tort or any other legal theory and whether or not advised of the possibility of such damages. All use is at your own risk, and you assume all costs of such risk.
Links to Other Websites
Links to other, non-AAM Internet sites are provided solely for convenience. If you use these links, you will leave this website. AAM has not reviewed all of these third party sites and does not control and is not responsible for any of these sites or their content. AAM does not endorse or make any representations about them, or any information, software or other products or materials found there, or any results that may be obtained from using them. Use of third party sites is entirely at your own risk.
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Unlawful or Prohibited Use
As a condition of your use of the website, you will not use it for any purpose that is unlawful or prohibited by these Terms. You may not use the services in any manner that could damage, disable, overburden, or impair any AAM server, or the network(s) connected to any AAM server, or interfere with any other party's use and enjoyment of the website. You may not attempt to gain unauthorized access to services, materials, other accounts, computer systems or networks connected to any AAM server or to the website, through hacking, password mining or any other means. You may not obtain or attempt to obtain any materials or information through any means not intentionally made available through the website.
Neither AAM nor its employees accept or consider unsolicited ideas, including ideas for new advertising campaigns, new promotions, new or improved products or technologies, product enhancements, processes, materials, marketing plans or new product names. Please do not send any original creative artwork, suggestions or other works. The sole purpose of this policy is to avoid potential misunderstandings or disputes when AAM's product or marketing strategies might seem similar to ideas submitted to AAM. If, despite our request that you not send us your ideas, you still send them, then regardless of what your letter says, the following terms shall apply to your idea submission. You agree that: (1) your ideas will automatically become the property of AAM, without compensation to you, and (2) AAM can use the ideas for any purpose and in any way, even give them to others.
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All trademarks displayed on this site are owned exclusively by AAM, or are used by AAM under license. These trademarks include marks that are registered and unregistered and include, but are not limited to, product brand names, slogans, and logos and emblems. The unauthorized use of any trademark owned or used by AAM is strictly prohibited.
Accounts and Security
If any of the services on the website requires you to open an account, you must complete the registration process by providing us with true, current, complete and accurate information as prompted by the applicable registration form, and you will maintain and promptly update such information to keep it true, current, complete and accurate. You also will choose a password and a user name. You are entirely responsible for maintaining the confidentiality of your password and account. You are responsible for any and all activities that occur under your account. You agree to notify AAM immediately of any unauthorized use of your account or any other breach of security. AAM will not be liable for any loss that you may incur as a result of someone else using your password or account, either with or without your knowledge. However, you may be liable for losses incurred by AAM or another party due to someone else using your account or password. You acknowledge and agree that certain services may provide password-restricted access to customer information. By using this website and registering for such services, you consent to AAM's display of such information via the services and accept all risks of unauthorized access to such information. If you provide any information that is false, inaccurate, out of date, or incomplete, or AAM has reasonable grounds to suspect that such information is false, inaccurate, out of date, or incomplete, AAM may suspend or terminate your account and refuse any and all current or future use of the services or any portion thereof. You are responsible for all costs and charges, including without limitation, phone and telecommunications equipment charges that you incur in order to use the services.
Normal Website Usage
When you visit AAM's website you do so anonymously. During normal website usage, we do not collect or store personally identifiable information such as name, mailing address, email address, phone number or social security number. We reserve our right to collect and/or store information during normal website usage, which may include the name of your Internet Service Provider (ISP), the date and time you entered our website, the amount of time you spend there, the pages you request, the referring website, and other such related information. Accordingly, we may gather this information to generate statistics and measure site activity for the purpose of continuously improving the website.
Why and When We Collect Personal Information
Sometimes it is necessary to collect specific information in order to fulfill a visitor's request for a service or correspondence. You voluntarily provide this information, such as name, mailing address, email address, type of request or other information, which is collected and stored by AAM to fulfill your request. Your personal information is not given to any other company for that company's independent use. AAM may employ third-party companies to perform services or functions on our behalf—data processors. These companies may require access to personal information in order to perform their functions, but may not use it for other purposes. Visitors to this website provide personally identifying information only when using one or more of the following services: (1) contact forms; (2) resume submission; (3) requests for additional information; (4) surveys and business reply forms; (5) subscription emails.
What We Do With Information You Provide Us
Transfer Of Data
Your information, including Personal Data, may be transferred to — and maintained on — computers located outside of your state, province, country or other governmental jurisdiction where the data protection laws may differ than those from your jurisdiction.
If you are located outside United States and choose to provide information to us, please note that we transfer the data, including Personal Data, to United States and process it there.
Disclosure of Data
Disclosure for Law Enforcement
Under certain circumstances, AAM may be required to disclose your Personal Data if required to do so by law or in response to valid requests by public authorities (e.g. a court or a government agency).
AAM may disclose your Personal Data in the good faith belief that such action is necessary to:
• To comply with a legal obligation
• To protect and defend the rights or property of AAM
• To prevent or investigate possible wrongdoing in connection with the website
• To protect the personal safety of users of the website or the public
• To protect against legal liability
Security of Data
The security of your data is important to us, but remember that no method of transmission over the Internet, or method of electronic storage is 100% secure. While we strive to use commercially acceptable means to protect your Personal Data, we cannot guarantee its absolute security.
Your Data Protection Rights Under General Data Protection Regulation (GDPR)
If you are a resident of the European Economic Area (EEA), you have certain data protection rights. AAM aims to take reasonable steps to allow you to correct, amend, delete, or limit the use of your Personal Data.
If you wish to be informed what Personal Data we hold about you and if you want it to be removed from our systems, please contact us at GDPR@aam.com.
In certain circumstances, you have the following data protection rights:
The right to access, update or to delete the information we have on you. Whenever made possible, you can access, update or request deletion of your Personal Data directly within your account settings section. If you are unable to perform these actions yourself, please contact us to assist you.
The right of rectification. You have the right to have your information rectified if that information is inaccurate or incomplete.
The right to object. You have the right to object to our processing of your Personal Data.
The right of restriction. You have the right to request that we restrict the processing of your personal information.
The right to data portability. You have the right to be provided with a copy of the information we have on you in a structured, machine-readable and commonly used format.
The right to withdraw consent. You also have the right to withdraw your consent at any time where AAM relied on your consent to process your personal information.
Please note that we may ask you to verify your identity before responding to such requests.
You have the right to complain to a Data Protection Authority about our collection and use of your Personal Data. For more information, please contact your local data protection authority in the European Economic Area (EEA). However, we are also happy to address any concerns you have directly.
We may use third-party Service Providers to monitor and analyze the use of our website.
Google Analytics is a web analytics service offered by Google that tracks and reports website traffic. Google uses the data collected to track and monitor the use of our website. This data is shared with other Google services. Google may use the collected data to contextualize and personalize the ads of its own advertising network.
For more information on the privacy practices of Google, please visit the Google Privacy Terms web page: http://www.google.com/intl/en/policies/privacy/
Facebook remarketing service is provided by Facebook Inc.
You can learn more about interest-based advertising from Facebook by visiting this page: https://www.facebook.com/help/164968693837950
To opt-out from Facebook's interest-based ads follow these instructions from Facebook: https://www.facebook.com/help/568137493302217
Facebook adheres to the Self-Regulatory Principles for Online Behavioral Advertising established by the Digital Advertising Alliance. You can also opt-out from Facebook and other participating companies through the Digital Advertising Alliance in the USA http://www.aboutads.info/choices/, the Digital Advertising Alliance of Canada in Canada http://youradchoices.ca/ or the European Interactive Digital Advertising Alliance in Europe http://www.youronlinechoices.eu/, or opt-out using your mobile device settings.
For more information on the privacy practices of Facebook, please visit Facebook's Data Policy: https://www.facebook.com/privacy/explanation
AdRoll remarketing service is provided by Semantic Sugar, Inc.
You can opt-out of AdRoll remarketing by visiting this AdRoll Advertising Preferences web page: http://info.evidon.com/pub_info/573?v=1nt=1nw=false
Our website does not address anyone under the age of 18 ("Children").
We do not knowingly collect personally identifiable information from anyone under the age of 18. If you are a parent or guardian and you are aware that your Children has provided us with Personal Data, please contact us. If we become aware that we have collected Personal Data from children without verification of parental consent, we take steps to remove that information from our servers.
Last updated: (Jan. 22, 2021)
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