American Axle (AXL) Sees FY12 Revs Below Consensus; Guides FY13

January 16, 2013 7:41 AM EST Send to a Friend
American Axle & Manufacturing Holdings, Inc. (NYSE: AXL) issued to following outlook:

AAM's 2012 Outlook:

* AAM expects full year sales in 2012 to be approximately $2.9 billion, which represents an increase of approximately 13.5% as compared to the full year 2011. The Street sees $2.93 billion.

* AAM expects adjusted earnings before interest expense, income taxes and depreciation and amortization (Adjusted EBITDA) to be approximately $350 million in 2012.

* * AAM defines Adjusted EBITDA to be earnings before interest, taxes, depreciation and amortization excluding the impact of curtailments, asset impairments, restructuring costs and special charges related to the closure of the Detroit Manufacturing Complex and Cheektowaga Manufacturing Facility, and debt refinancing and redemption costs, to the extent applicable. AAM believes that EBITDA and Adjusted EBITDA are meaningful measures of performance as they are commonly utilized by management and investors to analyze operating performance and entity valuation. Our management, the investment community and banking institutions routinely use these terms, together with other measures, to measure our operating performance relative to other Tier 1 automotive suppliers. EBITDA and Adjusted EBITDA should not be construed as income from operations, net income or cash flow from operating activities as determined under GAAP. Other companies may calculate EBITDA and Adjusted EBITDA differently.

* AAM expects full year net capital spending to approximate 6.5% of sales in 2012.

* * We define net capital spending as capital expenditures net of proceeds from the sale-leaseback of equipment and the sale of property, plant and equipment.

* AAM expects net debt to be approximately $1.39 billion at year-end 2012.

* * We define net debt as total debt less cash and cash equivalents.

* AAM expects to reverse the U.S. deferred tax asset valuation allowance in the fourth quarter of 2012. The impact of this adjustment is estimated to be in excess of $300 million.

AAM's 2013 Outlook:

* AAM expects full year sales in 2013 to be approximately $3.2 billion. This sales projection is based on the anticipated launch schedule of programs in AAM's new and incremental business backlog and the assumption that the U.S. Seasonally Adjusted Annual Rate of sales ("SAAR") will increase from approximately 14.5 million vehicle units in 2012 to approximately 15.0 million vehicle units in 2013.

The Street sees FY13 revs of $3.36 billion.

* AAM expects to generate earnings before interest expense, income taxes and depreciation and amortization (EBITDA) as a percentage of sales in the range of 13.0% - 13.5% in 2013.

* AAM expects full year net capital spending to approximate 7.0% of sales in 2013.

AAM's 2015 Target:

* AAM is targeting full year sales to exceed $4.0 billion and over $500 million of EBITDA in 2015. This sales and EBITDA projection is based on the anticipated launch schedule of programs in AAM's new and incremental business backlog and the assumption that the U.S. SAAR will be approximately 15.0 million vehicle units in 2015.


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