DETROIT, Aug. 5 /PRNewswire-FirstCall/ -- American Axle & Manufacturing Holdings, Inc. (AAM), which is traded as AXL on the NYSE, today reported its financial results for the second quarter of 2009.

Second Quarter 2009 Results

• Second quarter sales of $245.6 million
• AAM's quarterly results reflect the adverse impact of the extended production shutdowns by GM and Chrysler; AAM estimates the reduction in sales and operating income resulting from these shutdowns to be approximately $203.6 million and approximately $65.7 million (or $1.18 per share), respectively
• Special charges and other non-recurring operating costs of $191.8 million, or $3.46 per share; these charges were principally non-cash in the period and primarily related to asset impairments, hourly and salaried workforce reductions (including attrition programs and related statutory benefits) and the acceleration of Buydown Program (BDP) expense for UAW-represented associates at our original U.S. locations
• Net loss of $288.6 million, or $5.20 per share
• 57% year-over-year decline in total light truck production volumes as compared to the second quarter of 2008
• Content-per-vehicle of $1,401, approximately 7% higher as compared to the second quarter of 2008
• Non-GM sales of $57.6 million, or approximately 23.5% of total net sales
  

AAM's results in the second quarter were a net loss of $288.6 million or $5.20 per share. This compares to a net loss of $644.3 million or $11.89 per share in the second quarter of 2008.

AAM's results in the second quarter of 2009 were adversely impacted by the extended production shutdowns of GM and Chrysler. AAM estimates the reduction in sales and operating income resulting from these shutdowns to be approximately $203.6 million and approximately $65.7 million (or $1.18 per share), respectively.

In the second quarter of 2009, AAM incurred special charges, asset impairments and non-recurring operating costs of $191.8 million, or $3.46 per share. These charges were principally non-cash in the period and primarily related to asset impairments, hourly and salaried workforce reductions (including attrition programs and related statutory benefits) and the acceleration of BDP expense for UAW-represented associates at AAM's Detroit, Michigan; Three Rivers, Michigan; and Cheektowaga, New York manufacturing facilities.

Asset impairments totaled $172.8 million in the second quarter of 2009, including indirect inventory obsolescence and idled leased assets. These asset impairments primarily related to the impact of new capacity rationalization actions taken by GM and Chrysler as a result of their bankruptcy filings and subsequent reorganization plans, including extended production shutdowns for many of the product programs AAM currently supports. These asset impairments also contemplated changes in AAM's operating plans, including the idling and consolidation of a significant portion of the Detroit Manufacturing Complex, which were made necessary by the extended production shutdowns and other program delays and sourcing decisions taken by our customers in the second quarter of 2009.

The acceleration of BDP expense of $22.5 million in the second quarter of 2009 was triggered by associates voluntarily electing to accelerate AAM's remaining BDP obligations and terminate employment, as well as revised estimates of the number of associates that are expected to be permanently idled throughout the term of the 2008 labor agreements.

In the second quarter of 2008, AAM recorded $575.6 million, or $10.62 per share, of special charges, asset impairments and non-recurring operating costs, related to hourly and salaried workforce reductions, valuation allowances on deferred tax assets and other special charges, primarily relating to costs incurred in connection with plant closings, including costs to redeploy machinery and equipment.

"The extended production shutdowns by GM and Chrysler adversely impacted AAM's results for the second quarter of 2009. This required AAM to accelerate and expand restructuring actions to transition to new, reduced levels of customer demand and market requirements," said AAM's Co-Founder, Chairman of the Board and Chief Executive Officer, Richard E. Dauch. "Amid the increasingly challenging global market conditions we are experiencing this year, AAM remains focused on managing what we can control. We have nearly completed the comprehensive restructuring, resizing and recovery of our business by realigning AAM's global manufacturing capacity and reducing AAM's operating break-even level. As a result of these difficult, but necessary, restructuring actions, we are achieving permanent and transformational improvements in AAM's cost structure and operating flexibility. This will position AAM to return to profitability as part of a viable and sustainable future for our company."

Net sales in the second quarter of 2009 were $245.6 million as compared to $490.5 million in the second quarter of 2008. AAM estimates that approximately $203.6 million of this decrease was attributable to the extended production shutdowns by GM and Chrysler. Customer production volumes for the North American light truck and SUV programs AAM currently supports for GM and Chrysler were down approximately 57% in the second quarter of 2009 as compared to the second quarter of 2008. Non-GM sales represented approximately 23.5% of total sales in the second quarter of 2009.

AAM's content-per-vehicle is measured by the dollar value of its product sales supporting GM's North American light truck and SUV programs and Chrysler's heavy duty Dodge Ram pickup trucks. For the second quarter of 2009, AAM's content-per-vehicle increased approximately 7% to $1,401 as compared to $1,312 in the second quarter of 2008.

Net sales in the first half of 2009 were $648.0 million as compared to $1.1 billion in the first half of 2008. AAM's operating loss in the first half of 2009 was $277.3 million as compared to an operating loss of $609.5 million for the first half of 2008. For the first half of 2009, AAM estimates the reduction in sales and operating income resulting from the extended production shutdowns by GM and Chrysler to be $203.6 million and $65.7 million ($1.18 per share), respectively.

AAM's SG&A spending for the second quarter of 2009 was $45.5 million as compared to $44.9 million in the second quarter of 2008. In the first half of 2009, AAM's SG&A spending was $89.3 million as compared to $94.3 million in the first half of 2008. AAM's R&D spending for the first half of 2009 was approximately $35.7 million as compared to $42.1 million in the first half of 2008.

AAM defines free cash flow to be net cash provided by (or used in) operating activities less capital expenditures net of proceeds from the sales of equipment and dividends paid. Net cash used in operating activities in first half of 2009 was $26.4 million as compared to $75.9 million in the first half of 2008. Capital spending and deposits for the acquisition of property and equipment, net of proceeds from the sale of equipment in the first half of 2009 was $80.5 million as compared to $64.6 million in the first half of 2008. Reflecting the impact of this activity, AAM's free cash flow was a use of $106.9 million in the first half of 2009. Included in the first half of 2009 cash flow results, AAM paid $54.4 million for special charges and related costs, which primarily related to hourly and salaried attrition programs and related statutory benefits. In the first half of 2008, AAM's free cash flow was a use of $156.7 million.

A conference call to review AAM's second quarter 2009 results is scheduled today at 10:00 a.m. 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) 278-1452 from the United States or (973) 200-3383 from outside the United States. A replay will be available from 5:00 p.m. ET on August 5, 2009 until 5:00 p.m. ET August 12, 2009 by dialing (800) 642-1687 from the United States or (706) 645-9291 from outside the United States. When prompted, callers should enter conference reservation number 15908578.

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 the 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 trucks, sport utility vehicles, passenger cars and crossover utility vehicles.