American Axle posts higher sales, lower profits

on Aug1

Dauch: “Our financial results demonstrate the favorable impact of AAM’s recent strategic acquisitions…”

DETROIT — American Axle & Manufacturing Holdings Inc. reported a jump in revenue along with a net income slump, as it digests its recent acquisition of Metaldyne.

The drivetrain supplier on Friday said net income dipped 7 percent to $66.3 million, largely because of restructuring and acquisition expenses from its $3.3 billion purchase of Metaldyne Performance Group Inc. The deal, completed in April, will further diversify American Axle and reduce its dependence on General Motors, the supplier’s No. 1 customer.

The company said it posted second-quarter revenue of $1.76 billion, up 72 percent from a year earlier.

“Our financial results demonstrate the favorable impact of AAM’s recent strategic acquisitions and our ability to deliver operational excellence, technology leadership and world-class quality on a larger, more diverse scale,” CEO David Dauch said in a statement.

Non-GM sales increased during the quarter to a record $969.7 million, or 55 percent of sales, compared with $333.9 million, or 33 percent of sales, during the same quarter a year earlier.

The supplier said it expects to take a further hit to net income in the second half of the year because of further “significant costs and payments related to restructuring and acquisition related activities,” as well as accounting adjustments

The company maintains its $6.1 billion full-year revenue outlook, which is up $2 billion from the previous year’s forecast, reflecting its recent Metaldyne acquisition.

Earnings, adjusted for onetime gains and costs, came to 99 cents per share, beating analysts consensus prediction of 82 cents.

American Axle ranks No. 58 on Automotive News’ list of the top 100 global parts suppliers, with worldwide sales to automakers of $3.95 billion in 2016.

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