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AAM Reports Q1 2020 Financial Results

The company reported first-quarter sales of $1.34 billion.

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American Axle & Manufacturing Holdings Inc. (AAM) has reported its financial results for the first quarter 2020 and provided a liquidity update.    

First Quarter 2020 Results

  • Sales of $1.34 billion
  • Net loss attributable to AAM of $501.3 million, or (37.3)% of sales, which includes the impact of a pre-tax goodwill impairment of $510.0 million
  • Adjusted EBITDA of $213.3 million, or 15.9% of sales 
  • Diluted loss per share of $4.45; Adjusted earnings per share of $0.20
  • Net cash provided by operating activities of $139.4 million; Adjusted free cash flow of $83.3 million 

AAM said its first quarter financial results were unfavorably impacted by global production reductions due to the coronavirus pandemic (COVID-19).

“AAM delivered strong operating performance and free cash flow generation in the first quarter of 2020 despite the unfavorable impact of COVID-19 on global light vehicle production. We expect this unprecedented health crisis and related effect on global light vehicle production and consumer demand to further impact AAM’s financial results in the second quarter of 2020,” said AAM’s Chairman and CEO David C. Dauch. “As we begin to resume our global operations, we are focused on securing a safe and healthy workplace for our associates while utilizing our variable cost structure to mitigate the steep decline in global production volumes.  In addition, we will continue to work with our supply base to meet customer requirements and structurally adjust our operations to the new market demand.”

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AAM’s sales in the first quarter of 2020 were $1.34 billion as compared to $1.72 billion in the first quarter of 2019.  AAM estimates that our sales for the first quarter of 2020 were unfavorably impacted by COVID-19 by approximately $169 million.  In addition, our first quarter of 2019 sales include $182 million related to our U.S. iron casting operations, which were sold in December 2019.

AAM’s net loss in the first quarter of 2020 was $501.3 million, or $4.45 per share, as compared to net income of $41.6 million, or 36 cents per share in the first quarter of 2019.  

Adjusted earnings per share in the first quarter of 2020 were 20 cents compared to 36 cents in the first quarter of 2019. 

AAM estimates that net loss in the first quarter of 2020 was unfavorably impacted by lower production as a result of COVID-19 by approximately $37 million, or 33 cents per share. In the first quarter of 2020, Adjusted EBITDA was $213.3 million, or 15.9% of sales, as compared to $245 million, or 14.3% of sales, in the first quarter of 2019. AAM estimates that its Adjusted EBITDA in the first quarter of 2020 was unfavorably impacted by COVID-19 by approximately $47 million. In addition, the first quarter of 2019 Adjusted EBITDA includes $18 million related to the company’s U.S. iron casting operations.

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AAM’s net cash provided by operating activities for the first quarter of 2020 was $139.4 million as compared to a use of $80.2 million for the first quarter of 2019.  

AAM’s 2020 Financial Outlook 
As a result of the unexpected disruption in light vehicle production and economic uncertainty due to the impact of the COVID-19 pandemic, AAM withdrew its 2020 financial outlook on March 25, 2020.  

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