Friday, July 27, 2007

UPDATE: American Axle's 2Q Net Up On Higher Sales, Cost Cuts

Dow Jones

DETROIT -(Dow Jones)- American Axle & Manufacturing Holdings Inc. (AXL) said Friday that second-quarter net income rose 67% due to productivity gains, cost cuts and higher sales.

Detroit-based American Axle is a major supplier to General Motors Corp.'s (GM) new pickup trucks.

The company also increased its new business backlog for 2008 to 2012 by $400 million to $1.2 billion.

While production of full-size sport-utility vehicles and pickup trucks for GM and the Chrysler Group was flat year over year, production on midsize SUV and truck programs American Axle supplies was down about 18%.

Net income for the quarter ended June 30 was $34 million, or 64 cents a share, compared with $20.4 million, or 40 cents a share, in the year-ago period.

Revenue increased to 4.8% to $916.5 million from $874.6 million.

Analysts surveyed by Thomson Financial forecast earnings of 60 cents a share and revenue of $888.75 million, on average.

"Through the first half of 2007, AAM is on track to achieve its annual objectives for sales growth, margin expansion and free cash flow generation," said American Axle Chairman and Chief Executive Richard E. Dauch in a statement.

American Axle said that much of the new business it will launch in 2008 through 2012 will be built at its non-U.S. plants and that about half the business is for rear-wheel-drive and all-wheel-drive passenger car and crossover vehicle applications.

The company is working to lessen its dependence on pickup truck and sport- utility vehicles and to widen its customer base.

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