10-year

Don't Miss This Only Promotion (20% off)

Join GuruFocus Premium Membership Now for Only $279/Year

Save up to $500 on Global Membership.

Don't Miss It !

Free 7-day Trial
All Articles and Columns »

American Axle & Manufacturing Holdings I Reports Operating Results (10-Q)

July 30, 2010 | About:
10qk

10qk

18 followers
American Axle & Manufacturing Holdings I (AXL) filed Quarterly Report for the period ended 2010-06-30.

American Axle & Manufacturing Holdings I has a market cap of $650.1 million; its shares were traded at around $9.1 with and P/S ratio of 0.4. AXL is in the portfolios of Arnold Schneider of Schneider Capital Management, James Barrow of Barrow, Hanley, Mewhinney & Strauss, George Soros of Soros Fund Management LLC, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Gross Profit (Loss) Gross profit increased to $98.9 million in the second quarter of 2010 as compared to a gross loss of $215.1 million in the second quarter of 2009. Gross margin increased to 17.7% in the second quarter of 2010 as compared to negative 87.6% in the second quarter of 2009. The increase in gross profit (loss) and gross margin in the second quarter of 2010, as compared to the second quarter of 2009, reflects lower special charges, the positive impact of an increase in sales and continued structural cost reductions. The increase also reflects the adverse impact of the extended production shutdowns at GM and Chrysler on gross profit (loss) and gross margin in the second quarter of 2009, which we estimated to be $65.7 million. Gross profit in the second quarter of 2010 includes net special charges of $1.7 million related to $8.7 million of asset impairment and related charges at our Salem Manufacturing Facility, net of $7.0 million of adjustments to previously recorded estimates for supplemental unemployment benefits (SUB) and idled leased asset accruals.

Selling, General and Administrative Expenses (SG&A) SG&A (including research and development (R&D)) was $48.5 million or 8.7% of net sales in the second quarter of 2010 as compared to $45.5 million or 18.5% of net sales in the second quarter of 2009. The increase in SG&A in the second quarter of 2010 reflects higher profit sharing accruals and other incentive compensation expense due to increased profitability, partially offset by structural cost reductions and lower professional fees related to restructuring actions. SG&A in the second quarter of 2009 included special charges related to salaried workforce reductions of $1.0 million. R&D was $18.6 million in the second quarter of 2010 as compared to $17.0 million in the second quarter of 2009.

Selling, General and Administrative Expenses (SG&A) SG&A (including research and development (R&D)) was $93.8 million or 8.7% of net sales in the first six months of 2010 as compared to $89.3 million or 13.8% of net sales in the first six months of 2009. The increase in SG&A in the first half of 2010 reflects higher profit sharing accruals and other incentive compensation expense due to increased profitability, partially offset by structural cost reductions and lower professional fees related to restructuring actions. SG&A in the first six months of 2009 included special charges of $2.0 million related to salaried workforce reductions. R&D was $37.7 million in the first six months of 2010 as compared to $35.7 million in the first six months of 2009.

Cash paid for special charges In the first six months of 2010, we made cash payments of $22.5 million for special charges compared to $51.7 million in the first six months of 2009. These cash payments primarily related to hourly and salaried workforce reductions initiated prior to 2010, including $12.4 million of pension contributions made in the first quarter of 2010 related to special termination benefit payments that were previously paid out of our pension trusts. We expect to make payments of approximately $7 million in the second half of 2010, $10 million in 2011 and $5 million in 2012 related to the remaining restructuring accrual. We expect to make between $15 million and $20 million of payments related to the Buydown Program in the second half of 2010.

Financing Activities Net cash provided by (used in) financing activities was net cash used in financing activities of $61.0 million in the first six months of 2010 as compared to net cash provided by financing activities of $120.8 million in the first six months of 2009. Total long-term debt outstanding decreased $58.8 million in the first six months of 2010 to $1,012.6 million as compared to $1,071.4 million at year-end 2009, primarily as a result of using cash flow from operations to pay down the amount outstanding under our Revolving Credit Facility as of December 31, 2009.

At June 30, 2010, we had $262.5 million available under the Revolving Credit Facility. This availability reflects a reduction of $33.8 million for standby letters of credit issued against the facility. We also utilize foreign credit facilities and uncommitted lines of credit to finance working capital needs. At June 30, 2010, $35.4 million was outstanding and $3.9 million was available under such agreements.

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 0.0/5 (0 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK