AAM Reports First Quarter 2014 Financial Results

               AAM Reports First Quarter 2014 Financial Results

Non-GM sales of $288 million, up over 50% on a year-over-year basis

PR Newswire

DETROIT, May 2, 2014

DETROIT, May 2, 2014 /PRNewswire/ --American Axle & Manufacturing Holdings,
Inc. (AAM), which is traded as AXL on the NYSE, today reported its financial
results for the first quarter of 2014.

First Quarter 2014 Results

  oFirst quarter 2014 sales of $858.8 million, up approximately 13.7% on a
    year-over-year basis
  oNon-GM sales grew over 50% on a year-over-year basis to $287.8 million
  oGross profit of $121.9 million, or 14.2% of sales
  oNet income of $33.6 million, or $0.44 per share
  oEBITDA (earnings before interest, taxes, depreciation and amortization) of
    $112.5 million, or 13.1% of sales

AAM's net income in the first quarter of 2014 was $33.6 million, or $0.44 per
share as compared to net income of $7.3 million, or $0.10 per share, in the
first quarter of 2013. In the first quarter of 2013, AAM's results reflect the
impact of $11.3 million (or $0.13 per share) of debt refinancing and
redemption costs.

"AAM's financial results in the first quarter of 2014 reflect strong sales
growth that continues to outpace the industry," said AAM's Chairman, President
and Chief Executive Officer, David C. Dauch. "AAM's top priority in 2014 is
to flawlessly launch our new business backlog which will drive higher
profitability, improve free cash flow generation and enhance business
diversification for our fast-growing company. We remain committed to
delivering world-class quality products, maintaining operational excellence at
every one of our 35 global facilities and demonstrating technology leadership
by continuing to develop innovative driveline solutions for the global
automotive market."

Led by higher sales in support of Chrysler's all-new Jeep Cherokee and
heavy-duty Ram full-size pickup trucks and its derivatives, AAM's sales in the
first quarter of 2014 increased approximately 13.7% to $858.8 million as
compared to $755.6 million in the first quarter of 2013. Non-GM sales grew
53.0% on a year-over-year basis to $287.8 million in the first quarter of 2014
as compared to $188.1 million in the first quarter of 2013.

AAM's content-per-vehicle is measured by the dollar value of its product sales
supporting our customers' North American light truck and SUV programs. In the
first quarter of 2014, AAM's content-per-vehicle increased 10.0% to $1,655as
compared to $1,504 in the first quarter of 2013.

AAM's gross profit in the first quarter of 2014 was $121.9 million, or 14.2%
of sales, as compared to $104.3 million, or 13.8% of sales, in the first
quarter of 2013.

In the first quarter of 2014, AAM's operating income increased over $20
million to $64.8 million, or 7.5% of sales, as compared to $44.7 million, or
5.9% of sales, in the first quarter of 2013.

AAM's SG&A spending in the first quarter of 2014 was $57.1 million, or 6.6% of
sales, as compared to $59.6 million, or 7.9% of sales, in the first quarter of
2013. AAM's R&D spending in the first quarter of 2014 was $25.8 million as
compared to $28.5 million in the first quarter of 2013.

In the first quarter of 2014, AAM's net income was $33.6 million, or $0.44 per
share as compared to $7.3 million or $0.10 per share in the first quarter of
2013.

AAM defines EBITDA to be earnings before interest, taxes, depreciation and
amortization. In the first quarter of 2014, AAM's EBITDA increased over $37
million to $112.5 million, or 13.1% of sales, as compared to $75.3 million, or
10.0% of sales, in the first quarter of 2013.

AAM defines free cash flow to be net cash provided by (or used in) operating
activities less capital expenditures net of proceeds from the sale of
property, plant and equipment and the sale-leaseback of equipment.

Net cash used in operating activities for the first quarter of 2014 was $55.5
million. Capital spending, net of proceeds from the sale of property, plant
and equipment, for the first quarter of 2014 was $40.0 million. Reflecting
the impact of this activity, AAM's free cash flow was a use of $95.5 million
for the first quarter of 2014.

A conference call to review AAM's first quarter 2014 results is scheduled
today at 10:00 AM ET. Interested participants may listen to the live
conference call by logging onto AAM's investor web site at
http://investor.aam.com or calling (877) 681-2072 from the United States or
(973) 200-3383 from outside the United States. A replay will be available
from 2:00 p.m. ET on May 2, 2014 until 5:00 p.m. ET May 9, 2014 by dialing
(855) 859-2056 from the United States or (404) 537-3406 from outside the
United States. When prompted, callers should enter conference reservation
number 34605136.

Non-GAAP Financial Information
In addition to the results reported in accordance with accounting principles
generally accepted in the United States of America (GAAP) included within this
press release, AAM has provided certain information, which includes non-GAAP
financial measures. Such information is reconciled to its closest GAAP
measure in accordance with Securities and Exchange Commission rules and is
included in the attached supplemental data.

Management believes that these non-GAAP financial measures are useful to both
management and its stockholders in their analysis of the Company's business
and operating performance. Management also uses this information for
operational planning and decision-making purposes.

Non-GAAP financial measures are not and should not be considered a substitute
for any GAAP measure. Additionally, non-GAAP financial measures as presented
by AAM may not be comparable to similarly titled measures reported by other
companies.

AAM is a world leader in the manufacture, engineering, design and validation
of driveline and drivetrain systems and related components and modules,
chassis systems and metal-formed products for light trucks, sport utility
vehicles, passenger cars, crossover vehicles and commercial vehicles. In
addition to locations in the United States (Michigan, Ohio, Pennsylvania and
Indiana), AAM also has offices or facilities in Brazil, China, Germany, India,
Japan, Luxembourg, Mexico, Poland, Scotland, South Korea, Sweden and Thailand.

In this earnings release, we make statements concerning our expectations,
beliefs, plans, objectives, goals, strategies, and future events or
performance. Such statements are "forward-looking" statements within the
meaning of the Private Securities Litigation Reform Act of 1995 and relate to
trends and events that may affect our future financial position and operating
results. The terms such as "will," "may," "could," "would," "plan," "believe,"
"expect," "anticipate," "intend," "project," "target," and similar words or
expressions, as well as statements in future tense, are intended to identify
forward-looking statements. Forward-looking statements should not be read as
a guarantee of future performance or results, and will not necessarily be
accurate indications of the times at, or by, which such performance or results
will be achieved. Forward-looking statements are based on information
available at the time those statements are made and/or management's good faith
belief as of that time with respect to future events and are subject to risks
and may differ materially from those expressed in or suggested by the
forward-looking statements. Important factors that could cause such
differences include, but are not limited to: reduced purchases of our products
by General Motors Company (GM), Chrysler Group LLC (Chrysler) or other
customers; reduced demand for our customers' products (particularly light
trucks and sport utility vehicles (SUVs) produced by GM and Chrysler); our
ability or our customers' and suppliers' ability to successfully launch new
product programs on a timely basis; our ability to realize the expected
revenues from our new and incremental business backlog; our ability to develop
and produce new products that reflect market demand; lower-than-anticipated
market acceptance of new or existing products; our ability to attract new
customers and programs for new products; our ability to respond to changes in
technology, increased competition or pricing pressures; our ability to achieve
the level of cost reductions required to sustain global cost competitiveness;
supply shortages or price increases in raw materials, utilities or other
operating supplies for us or our customers as a result of natural disasters or
otherwise; global economic conditions, including the impact of the continued
market weakness in the Euro-zone; risks inherent in our international
operations (including adverse changes in political stability, taxes and other
law changes, potential disruptions of production and supply, and currency rate
fluctuations); liabilities arising from warranty claims, product recall or
field actions, product liability and legal proceedings to which we are or may
become a party, or the impact of product recall or field actions on our
customers; price volatility in, or reduced availability of, fuel; our ability
to successfully implement upgrades to our enterprise resource planning
systems; our ability to maintain satisfactory labor relations and avoid work
stoppages; our suppliers', our customers' and their suppliers' ability to
maintain satisfactory labor relations and avoid work stoppages; our ability to
attract and retain key associates; availability of financing for working
capital, capital expenditures, research and development (R&D) or other general
corporate purposes, including our ability to comply with financial covenants;
our customers' and suppliers' availability of financing for working capital,
capital expenditures, R&D or other general corporate purposes; changes in
liabilities arising from pension and other postretirement benefit obligations;
risks of noncompliance with environmental laws and regulations or risks of
environmental issues that could result in unforeseen costs at our facilities;
adverse changes in laws, government regulations or market conditions affecting
our products or our customers' products (such as the Corporate Average Fuel
Economy (CAFE) regulations); our ability to consummate and integrate
acquisitions and joint ventures; our ability or our customers' and suppliers'
ability to comply with the Dodd-Frank Act and other regulatory requirements
and the potential costs of such compliance; and other unanticipated events and
conditions that may hinder our ability to compete. It is not possible to
foresee or identify all such factors and we make no commitment to update any
forward-looking statement or to disclose any facts, events or circumstances
after the date hereof that may affect the accuracy of any forward-looking
statement.

For more information...

Christopher M. Son
Director, Investor Relations,
Corporate Communications & Marketing
(313) 758-4814
chris.son@aam.com

Danielle Landolt
Manager, Marketing & Communications
(313) 758-4589
danielle.landolt@aam.com

Or visit the AAM website at www.aam.com.



AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
                                          Three months ended
                                          March 31,
                                          2014                  2013
                                          (in millions, except per share data)
Net sales                                 $    858.8            $   755.6
Cost of goods sold                        736.9                 651.3
Gross profit                              121.9                 104.3
Selling, general and administrative       57.1                  59.6
expenses
Operating income                          64.8                  44.7
Interest expense                          (25.0)                (29.1)
Investment income                         0.3                   0.1
Other income (expense)
Debt refinancing and redemption costs     —                     (11.3)
Other, net                                0.5                   0.5
Income before income taxes                40.6                  4.9
Income tax expense (benefit)              7.0                   (2.4)
Net income                                $    33.6             $   7.3
Diluted earnings per share                $    0.44             $   0.10
Diluted shares outstanding                77.1                  76.2



AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
                                                            Three months ended
                                                            March 31,
                                                            2014       2013
                                                            (in millions)
Net income                                                  $  33.6    $ 7.3
Other comprehensive income (loss)
Defined benefit plans, net of ($2.7) million and $0.7       5.1        (1.1)
million of tax in 2014 and 2013, respectively
Foreign currency translation adjustments                    7.8        4.9
Change in derivatives                                       0.9        0.5
Other comprehensive income                                  13.8       4.3
Comprehensive income                                        $  47.4    $ 11.6



AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
                                                  March 31, 2014  December 31,

                                                  (Unaudited)     2013
                                                  (in millions)
ASSETS
Current Assets
Cash and cash equivalents                         $   79.6        $  154.0
Accounts receivable, net                          654.1           458.5
Inventories, net                                  258.0           261.8
Prepaid expenses and other current assets         116.4           123.5
Total current assets                              1,108.1         997.8
Property, plant and equipment, net                1,067.6         1,058.5
Deferred income taxes                             338.5           341.8
Goodwill                                          156.4           156.4
GM postretirement cost sharing asset              235.8           242.0
Other assets and deferred charges                 243.3           232.5
Total assets                                      $   3,149.7     $  3,029.0
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable                                  $   478.8       $  445.8
Accrued compensation and benefits                 88.5            110.1
Deferred revenue                                  22.3            17.0
Accrued expenses and other current liabilities    108.2           94.2
Total current liabilities                         697.8           667.1
Long-term debt                                    1,578.4         1,559.1
Deferred revenue                                  106.9           76.4
Postretirement benefits and other long-term       683.3           692.8
liabilities
Total liabilities                                 3,066.4         2,995.4
Total stockholders' equity                        83.3            33.6
Total liabilities and stockholders' equity        $   3,149.7     $  3,029.0



AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
                                                            Three months ended
                                                            March 31,
                                                            2014      2013
                                                            (in millions)
Operating Activities
Net income                                                  $  33.6   $ 7.3
Adjustments to reconcile net income to net cash used in
operating activities
 Depreciation and amortization                            46.9      41.3
 Other                                                    (136.0)   (75.4)
Net cash used in operating activities                       (55.5)    (26.8)
Investing Activities
Purchases of property, plant & equipment                    (47.9)    (47.9)
Proceeds from sale of property, plant & equipment           7.9       0.1
Proceeds from sale-leaseback of equipment                   —         3.9
Net cash used in investing activities                       (40.0)    (43.9)
Financing Activities
Net increase in long-term debt                              20.6      114.7
Debt issuance costs                                         (0.2)     (6.2)
Purchase of treasury stock                                  (0.3)     —
Employee stock option exercises                             0.6       —
Net cash provided by financing activities                   20.7      108.5
Effect of exchange rate changes on cash                     0.4       0.6
Net increase (decrease) in cash and cash equivalents        (74.4)    38.4
Cash and cash equivalents at beginning of period            154.0     62.4
Cash and cash equivalents at end of period                  $  79.6   $ 100.8



AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
SUPPLEMENTAL DATA
(Unaudited)
The supplemental data presented below is a reconciliation of certain financial
measures which is intended to facilitate analysis of American Axle &
Manufacturing Holdings, Inc. business and operating performance.
Earnings before interest expense, income taxes and depreciation and
amortization (EBITDA) and adjusted EBITDA^(a)
                       Three months ended
                       March 31,
                       2014           2013
                       (in millions)
Net income             $   33.6       $       7.3
Interest expense       25.0           29.1
Income tax expense     7.0            (2.4)
(benefit)
Depreciation and       46.9           41.3
amortization
EBITDA                 $   112.5      $       75.3
Debt refinancing and   —              11.3
redemption costs
ADJUSTED EBITDA        $   112.5      $       86.6
Net debt^(b) to capital
                                      March 31, 2014          December 31,
                                                              2013
                                      (in millions, except percentages)
Total debt                            $       1,578.4         $     1,559.1
Less: cash and cash                   79.6                    154.0
equivalents
Net debt at end of                    1,498.8                 1,405.1
period
Stockholders' equity                  83.3                    33.6
Total invested capital                $       1,582.1         $     1,438.7
at end of period
Net debt to                           94.7%                   97.7%
capital^(c)



AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
SUPPLEMENTAL DATA
(Unaudited)
The supplemental data presented below is a reconciliation of certain financial
measures which is intended to facilitate analysis of American Axle &
Manufacturing Holdings, Inc. business and operating performance.

Free Cash Flow^(d)
                                                           Three months ended
                                                           March 31,
                                                           2014       2013
                                                           (in millions)
Net cash used in operating activities                      $ (55.5)   $ (26.8)
Less: Purchases of property, plant & equipment, net of
proceeds from
                                                           (40.0)     (43.9)
sale of property, plant & equipment and sale-leaseback of
equipment
Free cash flow                                             $ (95.5)   $ (70.7)



    We define EBITDA to be earnings before interest, taxes, depreciation and
    amortization. We believe that EBITDA is a meaningful measure of
    performance as it is commonly utilized by management and investors to
    analyze operating performance and entity valuation. Our management, the
(a) investment community and the banking institutions routinely use EBITDA,
    together with other measures, to measure our operating performance
    relative to other Tier 1 automotive suppliers. 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 differently.
(b) Net debt is equal to total debt less cash and cash equivalents.
    Net debt to capital is equal to net debt divided by the sum of
    stockholders' equity and net debt. We believe that net debt to capital is
(c) a meaningful measure of financial condition as it is commonly utilized by
    management, investors and creditors to assess relative capital structure
    risk. Other companies may calculate net debt to capital differently.
    We define free cash flow as net cash provided by (used in) operating
    activities less capital expenditures net of proceeds from the sale of
    property, plant and equipment and the sale-leaseback of equipment. For
    purposes of calculating free cash flow, AAM excludes the impact of
(d) purchase buyouts of leased equipment, if any. We believe free cash flow
    is a meaningful measure as it is commonly utilized by management and
    investors to assess our ability to generate cash flow from business
    operations to repay debt and return capital to our stockholders. Free
    cash flow is also a key metric used in our calculation of incentive
    compensation. Other companies may calculate free cash flow differently.



SOURCE American Axle & Manufacturing Holdings, Inc.

Website: http://www.aam.com
 
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