American Axle & Manufacturing Announces 2nd Quarter Earnings Per Share Up 19%
26 July 2000
First Half Sales, Net Income and EPS at All-Time Highs
DETROIT - American Axle & Manufacturing Holdings, Inc. today reported record
second quarter 2000 net income of $40.0 million, an increase of 19 percent over
the $33.7 million reported for the second quarter of 1999. Earnings per share
also increased 19% to 80 cents on a diluted basis, versus 67 cents per share
during the same period the prior year.
Sales increased 2% to $819.7 million for the second quarter of 2000 as
compared to $800.8 million in the second quarter of 1999. For the six months
ended June 30, 2000, sales were $1.656 billion, representing an increase of
$157 million, or 10%, from the $1.499 billion generated in the first six
months of 1999.
Operating income improved 13 percent to $77.1 million, or 9.4% of sales in
the quarter, as compared to $68.2 million or 8.5% of sales for the second
quarter of 1999. For the six months ended June 30, 2000, operating income was
$153.6 million, or 9.3% of sales, versus $126.2 million, or 8.4% of sales for
the same period of 1999.
Net income for the first half of 2000 was $80.1 million, or 4.8% of sales,
versus $62.7 million, or 4.2% of sales for the same period of 1999.
"We are proud to continue to deliver solid earnings performance," said
American Axle & Manufacturing Chairman, CEO & President Richard E. Dauch.
"Increased productivity and new higher-value-added products are helping to
drive margin improvement. Also, the Guanajuato Gear & Axle plant in Mexico
launched five months ahead of schedule. It is now producing both the 8.6 inch
and the newly developed 11.5 inch rear axles which helped to increase
operating margins."
Recent developments
On June 20, 2000, AAM celebrated the grand opening of its Cheektowaga, New
York facility. Today, 120 new AAM associates are working in the Cheektowaga
facility, using the latest technology, tooling, equipment and systems to
machine net-shaped gears. This critical value-added process had previously
been performed by outside suppliers.
The company continues to make progress on its strategies of diversifying
its customer base and expanding its product offerings. During the second
quarter, AAM announced that it had been selected as the supplier of rear axles
and driveshafts for a future Ford vehicle. This is AAM's first axle program
with Ford Motor Company.
Several AAM locations are readying themselves for the launch of AAM's
newest axle and driveline products which will go into GM's next generation
mid-size SUVs to be launched in early 2001. These new products will be
produced and launched at the Buffalo Gear, Axle & Linkage facility, the
Detroit Gear, & Axle facility, the Three Rivers (Michigan) Driveline facility
and the Detroit Forge facility.
AAM is a world leader in the manufacture, engineering, design and
validation of driveline systems, chassis systems and forged products for
trucks, buses, sport utility vehicles, and passenger cars. In addition to 13
locations in the United States (in Michigan, Ohio and New York), AAM has
offices and facilities in Brazil, England, Germany, Japan, Mexico and
Scotland.
AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
----------------------------------------------------------------------
Three months ended Six months ended
June 30, June 30,
------------------ -----------------
2000 1999 2000 1999
---- ---- ---- ----
(In millions, except per share data)
Net sales $819.7 $800.8 $1,655.6 $1,498.5
Cost of goods sold 699.6 692.4 1,415.8 1,298.0
------- ------- ---------- ---------
Gross profit 120.1 108.4 239.8 200.5
Selling, general
and administrative
expenses 41.9 39.1 84.1 73.1
Goodwill
amortization 1.1 1.1 2.1 1.2
------- ------- ---------- ---------
Operating income 77.1 68.2 153.6 126.2
Net interest
expense (14.9) (15.1) (28.1) (27.1)
Other income
(expense), net 1.3 (0.1) 1.6 (0.1)
------- ------- ---------- ---------
Income before
income taxes 63.5 53.0 127.1 99.0
Income taxes 23.5 19.3 47.0 36.3
------- ------- ---------- ---------
Net income $ 40.0 $ 33.7 $ 80.1 $ 62.7
======= ======= ========== =========
Diluted earnings
per share $ 0.80 $ 0.67 $ 1.60 $ 1.28
======= ======= ========== =========
Diluted shares
outstanding 50.1 50.1 50.1 49.0
======= ======= ========== ========
AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------
June 30, December 31,
2000 1999
--------- -------------
(In millions)
ASSETS
------
Current assets:
Cash and equivalents $ 67.9 $ 140.2
Accounts receivable, net 327.5 194.0
Inventories 138.9 133.3
Prepaid expenses and other 53.5 42.0
--------- ---------
Total current assets 587.8 509.5
Property, plant and
equipment, net 1,056.9 929.0
Goodwill and other assets 216.2 238.6
--------- ---------
Total assets $1,860.9 $1,677.1
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LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities $ 481.5 $ 446.7
Long-term debt 820.7 774.9
Postretirement benefits
and other long-term liabilities 215.6 191.8
--------- ---------
Total liabilities 1,517.8 1,413.4
Stockholders' equity 343.1 263.7
--------- ---------
Total liabilities and
stockholders' equity $1,860.9 $1,677.1
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