American Axle & Manufacturing (AAM) has posted first quarter net earnings of US$16.3m, compared to a net loss of US$32.7m in the first quarter of 2009.
In the first quarter of 2009, AAM incurred $12.3m of special charges and non-recurring operating costs, primarily related to hourly and salaried workforce reductions (including attrition programmes and related statutory benefits), plant closures and other actions to redeploy underutilised assets to avoid future capital spending.
“AAM’s financial results for the first quarter of 2010 continued a positive trend of improved profit and cash flow performance,” said AAM co-founder, chairman of the board and CEO, Richard Dauch.
“These results reflect the favourable impact of improving global industry conditions and the structural benefit of our focused and continuing efforts to sustain reductions in AAM’s fixed cost structure and operating breakeven level.”
Net sales in Q1 increased by around 30% on a year-over-year basis to US$521.9m, compared to US$402.4m in the first quarter of 2009. On a sequential basis, net sales in the quarter increased approximately 12% as compared to the fourth quarter of 2009.
Customer production volumes for the North American light truck and SUV programs AAM currently supports for GM and Chrysler, were rose by around 25% in Q1.
Non-GM sales in the first quarter of 2010 increased by around 30% on a year-over-year basis to US$124.1m or 23.8% of total sales
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 pick-up trucks. For the first quarter of 2010, AAM’s content-per-vehicle was $1,390.
Gross profit in the first quarter of 2010 increased $60.2m on a year-over-year basis to $87.m or 16.7% of sales, compared to the first quarter of 2009.
Q1 gross profit reflects the adverse impact of an arbitration ruling related to the transfer of certain production from the Detroit Manufacturing Complex to another AAM facility. In connection with the arbitrator’s ruling, AAM recorded a liability for back wages and benefits owed to certain UAW represented associates at the Detroit Manufacturing Complex.
Operating income in the first quarter of 2010 was $42m or 8% of sales.
Q1 net income was US$16.3m or 3.1% of sales.
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