Allison Transmission Announces Increased Quarterly Dividend and Preliminary First Quarter 2013 Results and Affirms Full Year

 Allison Transmission Announces Increased Quarterly Dividend and Preliminary
        First Quarter 2013 Results and Affirms Full Year 2013 Guidance

PR Newswire

INDIANAPOLIS, April 15, 2013

INDIANAPOLIS, April 15, 2013 /PRNewswire/ --Allison Transmission Holdings,
Inc. (NYSE: ALSN), the world's largest manufacturer of fully-automatic
transmissions for medium- and heavy-duty commercial vehicles, medium- and
heavy-tactical U.S. defense vehicles and hybrid-propulsion systems for transit
buses, announced today that its Board of Directors approved an increase in its
quarterly cash dividend from $0.06 to $0.12 per share on the Company's common
stock and non-voting common stock and is providing preliminary estimates of
certain of its financial and operations results for the three months ended
March 31, 2013.

(Logo: http://photos.prnewswire.com/prnh/20120702/DE33547LOGO)

The Company's Board of Directors declared quarterly dividends of $0.12 per
share on the Company's common stock and non-voting common stock, which is an
increase from the quarterly cash dividend of $0.06 per share that began in the
second quarter of 2012. Payment will be made on May 31, 2013, to stockholders
of record at the close of business on May 17, 2013.

The payment of any future quarterly dividends will be at the discretion of the
Board of Directors and will be dependent upon Allison Transmission's financial
position, results of operations, available cash, cash flow, capital
requirements and other factors deemed relevant by the Board of Directors.

Based on currently available information, for the first quarter of 2013, we
expect net sales to be in the range of $455 to $460 million and Adjusted
EBITDA excluding technology-related license expenses, a non-GAAP financial
measure, to be in the range of $144 to $149 million, implying an Adjusted
EBITDA margin excluding technology-related license expenses, a non-GAAP
financial measure, of approximately 32%. These expected results for the first
quarter of 2013 are consistent with management's expectations, and reflect
considerably lower demand in the North America energy sector's hydraulic
fracturing market and the previously considered reductions in defense net
sales.

In addition, we are affirming our full year 2013 guidance released to the
market on February 19, 2013: net sales to decline in the range of 6 to 8
percent, Adjusted EBITDA margin excluding technology-related license expenses
in the range of 32 to 34 percent, Adjusted Free Cash Flow, a non-GAAP
financial measure, in the range of $325 to $375 million, capital expenditures
in the range of $80 to $90 million and cash income taxes in the range of $15
to $20 million. Consistent with our previous guidance we expect low levels of
demand in the North America energy sector's hydraulic fracturing market,
reductions in U.S. defense spending to longer term averages experienced during
periods without active conflicts and lower demand in the North America
Hybrid-Propulsion Systems for Transit Bus end market due to municipal spending
constraints to lead to net sales reductions in these end markets. We also
expect that the majority of the full year 2013 net sales reduction implied by
the midpoint of our guidance will have occurred in the first quarter, followed
by growth in the Global On-Highway end markets for the balance of the year.
Our full year 2013 Adjusted EBITDA margin excluding technology-related license
expenses guidance incorporates several initiatives to proactively align costs
and programs across our business with Allison's net sales guidance.

The results described above and the reconciliation below are estimated,
preliminary and may change. Because we have not completed our normal quarterly
closing and review procedures for the quarter ended March 31, 2013, subsequent
events may occur that require adjustments to these results and there can be no
assurance that the final results for the quarter ended March 31, 2013 will not
differ materially from these estimates. These estimates should not be viewed
as a substitute for full interim financial statements prepared in accordance
with GAAP.

Adjusted EBITDA excluding technology-related license expenses, Adjusted EBITDA
margin excluding technology-related license expenses and Adjusted Free Cash
Flow are non-GAAP measures. Management uses Adjusted EBITDA excluding
technology-related license expenses, Adjusted EBITDA margin excluding
technology-related license expenses and Adjusted Free Cash Flow to evaluate
and control Allison's cash operating costs and to measure its operating
profitability. We believe the presentation of Adjusted EBITDA excluding
technology-related license expenses, Adjusted EBITDA margin excluding
technology-related license expenses and Adjusted Free Cash Flow enhances our
investors' overall understanding of the financial performance and cash flow of
our business. You should not consider Adjusted EBITDA excluding
technology-related license expenses, Adjusted EBITDA margin excluding
technology-related license expenses as an alternative to net income,
determined in accordance with GAAP, as an indicator of operating performance.
You should not consider Adjusted Free Cash Flow as an alternative to net cash
provided by operating activities, determined in accordance with GAAP, as an
indicator of our cash flow.

The following table reconciles the Company's estimated net income to its
estimate of Adjusted EBITDA excluding technology-related license expenses for
the three months ended March 31, 2013 based on the midpoint of the range set
forth above.



                                           For the three months

                                           ended March 31,
    (unaudited, in millions)               2013             2012
    Net income                             $    27.5     $    58.0
    plus:
    Interest expense, net                  33.9             40.7
    Income tax expense                     16.9             25.2
    Amortization of intangible assets      29.9             37.5
    Depreciation of property, plant and    24.7             24.6
    equipment
    Fee to terminate services agreement    —                16.0
    with the Sponsors (a)
    Initial public offering expenses (b)   —                5.7
    Technology-related investment expense  2.5              —
    (c)
    Loss on repurchases of long-term debt  —                13.5
    (d)
    Unrealized loss (gain) on hedge        1.9              (0.7 )
    contracts (e)
    Other, net (f)                         3.4              2.5
    Adjusted EBITDA                        $   140.7      $   223.0
    Technology-related license expenses    6.0              —
    (g)
    Adjusted EBITDA excluding              $   146.7      $   223.0
    technology-related license expenses
    Revenue                                $   457.4      $   601.9
    Adjusted EBITDA margin excluding       32.1 %           37.0 %
    technology-related license expenses
    Represents a one-time payment (recorded in other expense, net) to
(a) terminate the services agreement with affiliates of The Carlyle Group and
    Onex Partners.
(b) Represents fees and expenses (recorded in other expense, net) related to
    our initial public offering in March 2012.
    Represents an impairment charge (recorded in other expense, net) for an
(c) investment in co-development agreements to expand our position in
    transmission technologies.
    Represents a loss (recorded in other expense, net) realized on the
(d) redemptions and repayments of long-term debt for the three months ended
    March 31, 2012.
    Represents $1.9 million and ($0.7) million of unrealized losses/(gains)
(e) (recorded in other expense, net) on the mark-to-market of our foreign
    currency and commodities derivative contracts for the three months ended
    March 31, 2013 and 2012, respectively.
(f) Represents employee stock compensation expense and service fees (recorded
    in selling, general and administrative expenses) paid to the Sponsors.
    Represents $6.0 million (recorded in engineering – research and
(g) development) of payments for licenses to expand our position in
    transmission technologies.



About Allison Transmission

Allison Transmission is the world's largest manufacturer of fully-automatic
transmissions for medium- and heavy-duty commercial vehicles, medium- and
heavy-tactical U.S. defense vehicles and hybrid-propulsion systems for transit
buses. Allison transmissions are used in a variety of applications including
on-highway trucks (distribution, refuse, construction, fire and emergency),
buses (primarily school and transit), motor homes, off-highway vehicles and
equipment (primarily energy and mining) and defense vehicles (wheeled and
tracked). Founded in 1915, the Allison business is headquartered in
Indianapolis, Indiana, U.S.A. and employs approximately 2,800 people. Allison
has manufacturing facilities and customization centers located in China, The
Netherlands, Brazil, India and Hungary. With a global presence, serving
customers in North America, Europe, Asia, Australia, South America, and
Africa, Allison also has over 1,400 independent distributor and dealer
locations worldwide. More information about Allison is available at
www.allisontransmission.com.

Forward-Looking Statements

This press release may contain forward-looking statements. All statements
other than statements of historical fact contained in this press release are
forward-looking statements, including all statements regarding future
financial results. In some cases, you can identify forward-looking statements
by terminology such as "may," "will," "should," "expect," "plans," "project,"
"anticipate," "believe," "estimate," "predict," "intend," "forecast," "could,"
"potential," "continue" or the negative of these terms or other similar terms
or phrases. Forward-looking statements are not guarantees of future
performance and involve known and unknown risks. Factors which may cause the
actual results to differ materially from those anticipated at the time the
forward-looking statements are made include, but are not limited to: risks
related to our substantial indebtedness; our participation in markets that are
competitive; general economic and industry conditions; our ability to prepare
for, respond to and successfully achieve our objectives relating to
technological and market developments and changing customer needs; the failure
of markets outside North America to increase adoption of fully-automatic
transmissions; the discovery of defects in our products, resulting in delays
in new model launches, recall campaigns and/or increased warranty costs and
reduction in future sales or damage to our brand and reputation; the
concentration of our net sales in our top five customers and the loss of any
one of these; risks associated with our international operations; brand and
reputational risks; our intention to pay dividends; and labor strikes, work
stoppages or similar labor disputes, which could significantly disrupt our
operations or those of our principal customers. Although we believe the
expectations reflected in such forward-looking statements are based upon
reasonable assumptions, we can give no assurance that the expectations will be
attained or that any deviation will not be material. All information is as of
the date of this press release, and we undertake no obligation to update any
forward-looking statement to conform the statement to actual results or
changes in expectations.

Use of Non-GAAP Financial Measures

This press release contains information about Allison's financial results
which are not presented in accordance with accounting principles generally
accepted in the United States ("GAAP"). Such non-GAAP financial measures are
reconciled above to their closest GAAP financial measures. Non-GAAP financial
measures should not be considered in isolation or as a substitute for our
reported results prepared in accordance with GAAP and, as calculated, may not
be comparable to other similarly titled measures of other companies.



SOURCE Allison Transmission Holdings, Inc.

Website: http://www.allisontransmission.com
Contact: Investor Relations, (317) 242-3078, ir@allisontransmission.com, or
Media Relations, (317) 242-5000, media@allisontransmission.com
 
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