[Gen-AI Analysis] American Axle & Manufacturing Holdings, Inc. Business Report FY ended 2015 - MarkLines Automotive Information & Gen-AI Platform

American Axle & Manufacturing Holdings, Inc. Business Report FY ended Dec. 2015

Business Highlights

Financial Overview

(in million USD)

	FY ended Dec. 31, 2015	FY ended Dec. 31, 2014	Rate of change (%)	Factors
Net Sales	3,903.1	3,696.0	5.6	1)
Operating Income	358.1	267.6	33.8	2)

Factors
1) Net Sales
-The Company's sales in the fiscal year ended December 31, 2015 increased by 5.6% to USD 3,903.1 million. The increase in sales was primarily due to an approximately 5% increase in production volumes for North American light truck and SUV programs for GM and FCA. These gains were partially offset by a reduction of metal prices passed to the customers as well as negative foreign currency exchange effects.

2) Operating Income
-The Company's operating income for the fiscal year ended December 31, 2015 was USD 358.1 million, a 33.8% from the previous fiscal year. Factors for the increase include increased sales as well as an increased profit margin on the sales versus a comparatively smaller increase in selling, general, and administrative expenses.

Contracts

-The Company announced that it has been selected as the target supplier to provide axles and driveshafts for GM's next generation full-size truck program under GM's Strategic Sourcing Process (SSP). The Company expects to provide approximately 75% of the light-duty axles, 100% of the heavy-duty axles and 100% of the rear steel driveshafts for GM's next generation full-size truck program. (From a press release on July 31, 2015)

-The Company has approximately USD 725 million of new and incremental business backlog from 2016 to 2018.

Approximately 75% of the backlog is related to AWD and RWD applications for passenger cars and crossover vehicles.
Approximately 60% of the backlog is for customers other than GM.
Over 50% of the backlog is for end markets outside the U.S.

-Programs launched in 2015 include the following:

Front and rear drive axles for a global passenger car program for Jaguar Land Rover manufactured from the Company's Swidnica Manufacturing Facility in Poland
Rear axles for a global light truck program for Ford manufactured from the Company's Rayong Manufacturing Facility in Thailand
Rear axles for a full-size pickup truck program for Nissan manufactured from the Company's Guanajuato Manufacturing Complex in Mexico.

Outlook

-The Company anticipates its net sales for the fiscal year ending December 31, 2016 to be approximately USD 4.0 billion.

R&D Expenditure

(in million USD)

	FY ended Dec. 31, 2015	FY ended Dec. 31, 2014	FY ended Dec. 31, 2013
Overall	113.9	103.9	103.4

R&D Facilities

-The Company has 12 global engineering development centers across eight countries.

-In 2015, the Company began the move-in phase of its Advanced Technology Development Center in Detroit.

R&D Activities

-The focus of the Company's R&D investment includes the following:

Electronic integration in existing and future products to improve their performance
Development of hybrid and electric vehicle systems
Development of products which enhance fuel efficiency, reduce emissions, or improve NVH, power density, or traction control

Capital Expenditure

(in million USD)

	FY ended Dec. 31, 2015	FY ended Dec. 31, 2014	FY ended Dec. 31, 2013
Overall	193.5	206.5	251.9

-The capital spending primarily supported significant global program launches within new and incremental business backlog, as well as the upgrades to ERP systems.

-The Company expects that its capital expenditure in the fiscal year ending December 31, 2016 will be approximately 6% of its sales.