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American Axle & Manufacturing Holdings I Reports Operating Results (10-K)
Posted by: gurufocus (IP Logged)
Date: February 9, 2012 07:58AM
American Axle & Manufacturing Holdings I (AXL) filed Annual Report for the period ended 2011-12-31.
Highlight of Business Operations:We are also the principal supplier of driveline system products for the Chrysler Group LLC's (Chrysler) heavy-duty Dodge Ram full-size pickup trucks (Dodge Ram program) and its derivatives. Sales to Chrysler were approximately 8% of our total net sales in 2011, 9% in 2010 and 8% in 2009. In addition to GM and Chrysler, we supply driveline systems and other related components to Volkswagen AG, Audi AG, Scania AB, Mack Trucks Inc., PACCAR Inc., Nissan Motor Co. Ltd., Harley-Davidson Inc., Tata Motors, Ford Motor Company, Deere & Company and other original equipment manufacturers (OEMs) and Tier I supplier companies. Our net sales to customers other than GM increased to $710.0 million in 2011 as compared to $563.0 million in 2010 and $331.2 million in 2009.
NET SALES Net sales increased by 13% to $2,585.0 million in 2011 as compared to $2,283.0 million in 2010 and $1,521.6 million in 2009.
GROSS PROFIT (LOSS) Gross profit (loss) was a profit of $455.1 million in 2011 as compared to a profit of $401.7 million in 2010 and a loss of $31.1 million in 2009. Gross margin was 17.6% in both 2011 and 2010 and negative 2.0% in 2009. The increase in gross profit in 2011 as compared to 2010 primarily reflects the positive impact of an increase in sales and productivity gains, partially offset by special charges and the impact of the implementation of certain provisions of the 2009 Settlement and Commercial Agreement with GM. These provisions were effective January 1, 2011 and, among other things, include expanded warranty cost sharing and product price-downs. The increase in gross profit and gross margin in 2010, as compared to 2009, reflects the positive impact of an increase in sales, lower special charges and the favorable impact of structural cost reductions taken in 2008 and 2009.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (SG&A) SG&A (including R&D) was $231.7 million in 2011 as compared to $197.6 million in 2010 and $172.7 million in 2009. SG&A as a percentage of net sales was 9.0% in 2011, 8.7% in 2010 and 11.3% in 2009. The increase in SG&A in 2011 primarily reflects increased R&D spending, including costs related to e-AAM, a joint venture we formed in the fourth quarter of 2010 to develop and commercialize electric AWD hybrid driveline systems for passenger cars and crossover vehicles. The increase in SG&A in 2010 as compared to 2009 reflects increased R&D spending and higher profit sharing accruals and other incentive compensation expense due to increased profitability, partially offset by lower professional fees related to restructuring actions.
NET INCOME (LOSS) ATTRIBUTABLE TO AAM AND EARNINGS (LOSS) PER SHARE (EPS) Net income (loss) attributable to AAM was income of $142.8 million in 2011 as compared to income of $115.4 million in 2010 and a loss of $253.1 million in 2009. Diluted earnings (loss) was earnings of $1.89 per share in 2011 as compared to earnings of $1.55 per share in 2010 and a loss of $4.81 per share in 2009. Net Income (Loss) and EPS were primarily impacted by the factors discussed in Gross Profit (Loss), SG&A, Interest Expense, Debt Refinancing and Redemption Costs and Income Tax Expense (Benefit).