UPDATE: American Axle 4Q Net Loss Widens; To Suspend Dividend
30 Enero 2009 - 11:08AM
Noticias Dow Jones
American Axle & Manufacturing Holdings Inc. (AXL) will
suspend its dividend payment and look for ways to cut deeper after
the company posted a wider fourth-quarter loss and braces for lower
demand by its biggest customer, General Motors Corp (GM).
Chief Executive Richard Dauch, who branded 2008 as "the year
from hell," said the company will continue to wring more costs from
the company including reducing U.S. production by 70% in 2009. The
company trimmed 3,000 hourly jobs and 350 salaried positions last
year.
"The U.S. automotive industry has been pushed to the verge of
collapse due to numerous adverse market, economic and competitive
forces," Dauch said in a conference call Friday. "As a result, 2008
proved to be a brutally difficult and demanding year for the entire
domestic automotive industry."
The company declined to provide financial guidance for 2009.
"We don't know what is going to happen nor does anybody else,"
American Axle Chief Financial Officer Michael Simonte said. "We
have a plan to return to profitability this year. You may think we
are crazy, but that's OK. We are not going to be distracted by
sensational headlines. We are making massive changes to our
company."
Shares fell 26%, or 36 cents, to $1.04 in recent trading
Friday.
In one bright spot, General Motors' inventory levels appear to
have bottomed, meaning that American Axle will start seeing more
stabilized part demand - although it will be at lower levels,
Simonte said in the conference call Friday. The company also has a
$1.4 billion worth of "backlog" orders it is now filling.
American Axle said its fourth-quarter net loss widened to $112.1
million, or $2.17 a share, from $26.8 million, or 52 cents a share,
a year earlier. Results for the latest period included a charge
related to deferred U.S. and U.K. tax assets.
For the full year, American Axle swung to a loss of $1.22
billion, or $23.73 per share, from a profit of $37 million, or 70
cents per share, in 2007. Sales dropped 35 percent to $2.11 billion
from $3.25 billion. The full-year 2008 results included $985.4
million, or $19.10 per share, in one-time charges.
Dauch said the company lost $300 million in sales and spent $100
million on the "ungodly" 87-day strike and production cutbacks that
resulted from the walkout that started Feb. 26.
Net sales fell 33% to $503 million amid a 41% drop in
light-truck production volume at American Axle-supported product
programs at GM and Chrysler. The company projected the sales
decline earlier this month. Analysts surveyed by Thomson Reuters
were expecting a loss of 60 cents a share on revenue of $525
million. Gross margin was 5.7%.
American Axle generates around three-quarters of its revenue
from GM. Non-GM sales were 22% of total sales in the quarter. Two
weeks ago, GM, the biggest U.S. auto maker, reported that
fourth-quarter global sales skidded 26%.
Dauch declined to comment how he would react if GM is forced to
file for bankruptcy.
"We think GM will have a good successful run," Dauch said.
The company's results come amid a bleak U.S. sales outlook for
auto makers in 2009. American Axle predicts light vehicle sales of
10 million to 12 million this year and in 2010, a level even more
anemic than 2008's 13.2 million sales, its worst performance since
1992.
As American Axle shrinks in the U.S., the company is aiming to
increase its operations around the world. Dauch said two weeks ago
the company has contracted for $1.4 billion in new business from
2009 to 2013. Of that, 85% of the work will be sourced from
American Axle factories outside the U.S.
Earlier this month, Visteon Corp. (VC) and ArvinMeritor Inc.
(ARM) became the first two major suppliers to announce deeper
cost-cutting actions for 2009. Visteon shifted 2,050 salaried
workers to a four-day work week and cut their pay 25%. ArvinMeritor
scrapped plans to spin off its car-parts business last week and
said that it was reducing pay for about 100 senior executives,
including Chief Executive Chip McClure, by 10%. The remaining
white-collar workers, primarily in the U.S., will have their pay
cut 5%.
-By Jeff Bennett, Dow Jones Newswires;
jeff.bennett@dowjones.com; 248-204-5542
(Mike Barris contributed to this story)
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