American Axle & Manufacturing Holdings Inc (AXL) 2024 Q4 法說會逐字稿

Good morning. My name is Rocco, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the American Axle & Manufacturing fourth-quarter 2024 earnings conference call. (Operator Instructions) As a reminder, today's call is being recorded.

早安.我叫羅科 (Rocco)，今天我將擔任您的會議主持人。現在，我歡迎大家參加美國車橋製造公司 2024 年第四季財報電話會議。（操作員指示）提醒一下，今天的通話正在錄音。

I would now like to turn the call over to Mr. David Lim, Head of Investor Relations. Please go ahead, Mr. Lim.

現在，我想將電話轉給投資者關係主管 David Lim 先生。請繼續，林先生。

Thank you, and good morning, and I would like to welcome everyone who is joining us on AAM's fourth quarter earnings call. Earlier this morning, we released our fourth quarter of 2024 earnings announcement. You can see this announcement on the Investor Relations page of our website, www.aam.com, and through the PR Newswire services. You can also find supplemental slides for this conference call on the Investor page of our website as well. To listen to a replay of this call, you can dial 1 (877) 344-7529, replay access code 268-8905.

謝謝，早安，我歡迎大家參加 AAM 第四季財報電話會議。今天早些時候，我們發布了 2024 年第四季的財報公告。您可以在我們網站 www.aam.com 的投資者關係頁面或透過 PR Newswire 服務看到此公告。您也可以在我們網站的投資者頁面上找到本次電話會議的補充幻燈片。若要收聽本次通話的重播，您可以撥打 1 (877) 344-7529，重播接入碼 268-8905。

This replay will be available through February 21.

重播將持續到 2 月 21 日。

Before we begin, I'd like to remind everyone that the matters discussed on this call may contain comments and forward-looking statements that are subject to risks and uncertainties, which cannot be predicted or quantified and which may cause future activities and results of operations to differ materially from those discussed. For additional information, please reference Slide 2 of our investor presentation or the press release that was issued today related to this earnings deck -- earnings announcement. Also, during the call, we may refer to certain non-GAAP financial measures, information regarding these non-GAAP measures as well as a reconciliation of the non-GAAP measures to GAAP financial information is available in the presentation. Today's call is not intended and does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy securities of AAM or Dowlais in any jurisdiction where such offers or solicitations are not permitted by law. The subject matter of today's call will be addressed in a proxy statement that will be filed with the SEC.

在我們開始之前，我想提醒大家，本次電話會議中討論的事項可能包含評論和前瞻性陳述，這些評論和前瞻性陳述受風險和不確定性的影響，無法預測或量化，並且可能導致未來的活動和經營結果與討論的內容存在重大差異。欲了解更多信息，請參閱我們投資者簡報的第 2 張幻燈片或今天發布的與此收益平台——收益公告相關的新聞稿。此外，在電話會議期間，我們可能會參考某些非 GAAP 財務指標，有關這些非 GAAP 指標的資訊以及非 GAAP 指標與 GAAP 財務資訊的對帳可在簡報中查閱。今天的電話會議並不旨在構成出售要約或認購或購買 AAM 或 Dowlais 證券的要約邀請，在任何法律不允許此類要約或邀請的司法管轄區內。今天電話會議的主題將在提交給美國證券交易委員會的代理聲明中討論。

Investors should read the information in the proxy statement in its entirety when it becomes available. Information regarding the participants and the proxy solicitation is contained in AAM's case in AAM's annual proxy materials filed with the SEC and in Dowlais' case in Dowlais' equivalent filings and announcements made in accordance with applicable U.K. law. With that, let me turn things over to AAM's Chairman and CEO, David Dauch.

當代理聲明中的信息公佈後，投資者應該完整閱讀它。有關參與者和代理徵集的資訊包含在 AAM 向美國證券交易委員會提交的年度代理材料中的 AAM 案例中，以及 Dowlais 按照適用英國法律提交的等效文件和公告中的 Dowlais 案例中。接下來，讓我將話題轉給 AAM 董事長兼執行長 David Dauch。

Thank you, David, and good morning, everyone. Thank you for joining us today to discuss AAM's financial results for the fourth quarter and full year of calendar year 2024. Joining me on the call today are Chris May, AAM's Executive Vice President and Chief Financial Officer. To begin my comments today, I'll review the highlights of our fourth quarter and full year 2024 financial performance. Next, I'll cover our 2025 financial outlook.

謝謝你，大衛，大家早安。感謝您今天加入我們討論 AAM 2024 日曆年第四季和全年的財務表現。今天與我一起參加電話會議的還有 AAM 的執行副總裁兼財務長 Chris May。今天，我將首先回顧我們第四季和 2024 年全年財務表現的亮點。接下來，我將介紹我們 2025 年的財務展望。

And after Chris covers the details of our financial results, I'll provide some concluding remarks about our exciting Dowlais combination and then open it up for questions that you all may have. So let's begin.

在克里斯介紹完我們的財務業績細節之後，我將對我們令人興奮的 Dowlais 組合提供一些總結性評論，然後回答大家可能提出的問題。那麼就讓我們開始吧。

AAM closed the year out strong by continuing to make good operational progress in generating solid adjusted free cash flow in the quarter. AAM's fourth quarter of 2024 sales were $1.4 billion, and for the full year, AAM sales were approximately $6.1 billion. From a profitability perspective, AAM's adjusted EBITDA in the fourth quarter was $161 million or 11.6% of sales. For the full year, AAM's adjusted EBITDA was $749 million or 12.2% of sales. AAM's adjusted earnings per share in the fourth quarter of 2024 was a loss of $0.06 per share.

AAM 透過在本季度繼續取得良好的營運進展並產生穩健的調整後自由現金流，以強勁的表現結束了這一財年。AAM 2024 年第四季的銷售額為 14 億美元，全年 AAM 的銷售額約為 61 億美元。從獲利能力角度來看，AAM 第四季的調整後 EBITDA 為 1.61 億美元，佔銷售額的 11.6%。全年而言，AAM 的調整後 EBITDA 為 7.49 億美元，佔銷售額的 12.2%。AAM 2024 年第四季的調整後每股盈餘為每股虧損 0.06 美元。

For the full year, adjusted EPS was a positive $0.51 per share. Adjusted free cash flow was $79 million in the quarter and $230 million for the full year in 2024.

全年調整後每股收益為正 0.51 美元。本季調整後的自由現金流為 7,900 萬美元，2024 年全年調整後的自由現金流為 2.3 億美元。

For 2024, AAM delivered on the financial targets that we had outlined at the beginning of the year. We came in at the high end of our original adjusted EBITDA range and exceeded the midpoint of our adjusted free cash flow target. These were achieved while the industry experienced production revisions throughout the year. It was a solid performance by AAM as we managed the factors that are under our control and remained focused on operational efficiency.

到了 2024 年，AAM 實現我們在年初制定的財務目標。我們的調整後 EBITDA 達到了原始範圍的高端，並超過了調整後自由現金流目標的中點。這些是在業界全年經歷生產修訂的同時實現的。由於我們管理了可控制的因素並始終專注於營運效率，AAM 的表現非常出色。

Let's talk about a couple of recent business updates on Slide 4 of our presentation deck. We outlined in the past that it was our near-term objective to secure our core legacy driveline business. That began with our announcement several years ago where AAM secured contracts of more than $10 billion of lifetime revenues with next-generation full-size truck axles with multiple customers. Today, we announced we have secured a contract extension to supply power transfer units for the Ford Maverick and Bronco Sport vehicles. With this latest award, we have secured our next-generation core business for years to come.

讓我們在簡報第 4 張投影片中討論一些最近的業務更新。我們過去曾概述過，我們的近期目標是確保我們的核心傳統傳動系統業務。這始於我們幾年前宣布的一項消息，當時 AAM 與多家客戶簽訂了下一代全尺寸卡車車軸合同，總終身收入超過 100 億美元。今天，我們宣布已獲得續約合同，為福特 Maverick 和 Bronco Sport 車輛提供動力傳輸。憑藉這項最新獎項，我們確保了未來幾年的下一代核心業務。

Two weeks ago, we also announced our transformational combination with Dowlais, which will create a leading global driveline and metal forming supplier with significant size and scale. We have high conviction that this will create a significant value for our shareholders. I'll talk more about this exciting deal a little bit later today.

兩週前，我們也宣布了與Dowlais的轉型合併，這將創造一個規模龐大的全球領先傳動系統和金屬成型供應商。我們堅信這將為我們的股東創造巨大價值。今天晚些時候我將進一步談論這項令人興奮的交易。

From a business perspective, our strategy has been consistent. We continue to strive to improve and optimize our operations, drive EBITDA and free cash flow generation and manage factors under our control, and we're going to remain disciplined and focused on these priorities.

從業務角度來看，我們的策略一直是一致的。我們將繼續努力改善和優化我們的運營，推動 EBITDA 和自由現金流的產生並管理我們控制範圍內的因素，我們將保持紀律並專注於這些優先事項。

Before I hand it over to Chris on the call, let's talk about our 2025 financial outlook. From an end market perspective, we forecast North American production at approximately 15.1 million units. We are also monitoring multiple factors that can swing production, including interest rates, tariffs, inventory levels and the overall financial health of the consumer. Slide 5 illustrates AAM's 2025 financial outlook where AAM is targeting sales in the range of $5.8 billion to $6.05 billion, adjusted EBITDA of approximately $700 million to $760 million, and adjusted free cash flow of approximately $200 million to $230 million. As I said earlier, after Chris' financial commentary, I'll have some additional remarks regarding our recently announced strategic combination with Dowlais.

在我將電話交給克里斯之前，讓我們先談談我們的 2025 年財務展望。從終端市場角度，我們預測北美產量約 1,510 萬台。我們也正在監控可能影響生產的多種因素，包括利率、關稅、庫存水準和消費者的整體財務狀況。幻燈片 5 展示了 AAM 的 2025 年財務展望，其中 AAM 的目標銷售額在 58 億美元至 60.5 億美元之間，調整後的 EBITDA 約為 7 億美元至 7.6 億美元，調整後的自由現金流約為 2 億美元至 2.3 億美元。正如我之前所說，在克里斯發表財務評論之後，我將就我們最近宣布的與 Dowlais 的策略合併發表一些補充評論。

Now let me turn the call over to Chris. Chris?

現在讓我把電話轉給克里斯。克里斯？

Thank you, David, and good morning, everyone. I will cover the financial details of our fourth quarter and full year '24 results and our 2025 outlook with you today. I will also refer to the earnings slide deck as part of my prepared comments. So let's go ahead and begin with sales. In the fourth quarter of 2024, AAM sales were $1.38 billion compared to $1.46 billion in the fourth quarter of 2023.

謝謝你，大衛，大家早安。今天我將向您介紹我們第四季和全年 24 年業績的財務細節以及 2025 年的展望。我還將參考收益投影片作為我準備好的評論的一部分。那麼就讓我們繼續從銷售開始。2024 年第四季度，AAM 銷售額為 13.8 億美元，而 2023 年第四季為 14.6 億美元。

Slide 8 shows a walk of fourth quarter 2023 sales to fourth quarter 2024 sales. Volume mix and other lowered sales by $61 million as North American production declined by approximately 3% and we were impacted by the timing of launches of new next-generation products. Pricing was $5 million in the fourth quarter, and metal market pass-throughs and FX lowered net sales by approximately $16 million as both were lower year-over-year. For the full year of 2024, AAM sales were $6.12 billion as compared to $6.08 billion for the full year of 2023. The primary drivers of the increase were volume and mix, partially offset by lower metal market pass-throughs and FX.

投影片 8 展示了 2023 年第四季至 2024 年第四季的銷售額變化。由於北美產量下降約 3% 且我們受到新一代產品發佈時機的影響，銷售組合和其他因素導致銷售額下降 6,100 萬美元。第四季的定價為 500 萬美元，金屬市場轉嫁和外匯導致淨銷售額下降約 1,600 萬美元，因為兩項價格均比去年同期下降。2024 年全年，AAM 銷售額為 61.2 億美元，而 2023 年全年銷售額為 60.8 億美元。成長的主要驅動力是銷售和產品組合，但被金屬市場傳導率和外匯的下降部分抵消。

Now let's move on to profitability. Gross profit was $154.3 million in the fourth quarter of 2024 as compared to $154.9 million in the fourth quarter of 2023. Adjusted EBITDA was $160.8 million in the fourth quarter of 2024 versus $169.5 million last year. You can see the year-over-year walk down of adjusted EBITDA on Slide 9. In the quarter, the decline in volume mix and other impacted adjusted EBITDA by $20 million in the fourth quarter versus the prior year.

現在讓我們討論獲利能力。2024 年第四季毛利為 1.543 億美元，而 2023 年第四季為 1.549 億美元。2024 年第四季調整後 EBITDA 為 1.608 億美元，去年同期為 1.695 億美元。您可以在第 9 張投影片上看到調整後的 EBITDA 年減。本季度，銷售組合下滑及其他影響導致第四季度調整後 EBITDA 與去年同期相比減少 2,000 萬美元。

R&D was (technical difficulty) $749.2 million and adjusted EBITDA margin was 12.2% of sales. For the full year, this was an 80 basis point margin improvement as we delivered favorable year-over-year performance every single quarter this year.

研發費用（技術難度）為 7.492 億美元，調整後的 EBITDA 利潤率為銷售額的 12.2%。就全年而言，利潤率提高了 80 個基點，因為我們今年每個季度都實現了良好的同比業績。

Let me now cover SG&A. SG&A expense, including R&D in the fourth quarter of 2024 was $89 million or 6.4% of sales. This compares to $95.7 million or 6.5% of sales in the fourth quarter of 2023. AAM's R&D spending in the fourth quarter of 2024 was approximately $37.7 million, a slight decline from last year. As we head into 2025, we will continue to focus on controlling our SG&A costs.

現在讓我來介紹一下銷售、一般及行政費用。2024 年第四季包括研發在內的銷售、一般及行政費用為 8,900 萬美元，佔銷售額的 6.4%。相比之下，2023 年第四季的銷售額為 9,570 萬美元，佔 6.5%。AAM 在 2024 年第四季的研發支出約為 3,770 萬美元，較去年略有下降。邁入 2025 年，我們將持續致力於控制銷售、一般及行政費用 (SG&A) 成本。

We expect R&D expense to be down on a year-over-year basis by approximately $20 million as we optimize our spend in this area to reflect current market requirements.

我們預計研發費用將年減約 2,000 萬美元，因為我們將優化該領域的支出以反映當前的市場需求。

Let's move on to interest and taxes. Net interest expense was $37.3 million in the fourth quarter of 2024 compared to $42.9 million in the fourth quarter of 2023. In the fourth quarter of 2024, we recorded income tax expense of $6.8 million compared to $5.8 million in the fourth quarter of 2023. As we head into 2025, we expect our adjusted effective tax rate to be approximately 30%. Taking all these sales and cost drivers into account, our GAAP net loss was $13.7 million or $0.12 per share in the fourth quarter of 2024 compared to a net loss of $19.1 million or $0.16 per share in the fourth quarter of 2023.

讓我們繼續討論利息和稅收。2024 年第四季的淨利息支出為 3,730 萬美元，而 2023 年第四季為 4,290 萬美元。2024 年第四季度，我們記錄的所得稅費用為 680 萬美元，而 2023 年第四季為 580 萬美元。進入 2025 年，我們預計調整後的有效稅率將達到約 30%。考慮到所有這些銷售和成本驅動因素，我們 2024 年第四季的 GAAP 淨虧損為 1,370 萬美元或每股 0.12 美元，而 2023 年第四季的淨虧損為 1,910 萬美元或每股 0.16 美元。

Adjusted earnings per share, which excludes the impact of items noted in our earnings press release, was a loss of $0.06 per share in the fourth quarter of 2024 compared to a loss of $0.09 per share in the fourth quarter of 2023. However, for the full year of 2024, AAM's adjusted earnings per share was $0.51 versus a loss of $0.09 per share in 2023.

調整後每股收益（不包括我們收益新聞稿中指出的項目的影響）在 2024 年第四季為每股虧損 0.06 美元，而 2023 年第四季為每股虧損 0.09 美元。然而，2024 年全年，AAM 的調整後每股收益為 0.51 美元，而 2023 年每股虧損為 0.09 美元。

Let's now move to cash flow and the balance sheet. Net cash provided by operating activities for the fourth quarter of 2024 was $151.2 million compared to $52.9 million in the fourth quarter of 2023. Capital expenditures, net of proceeds from the sale of property, plant and equipment for the fourth quarter of 2024 were $77.6 million. Cash payments for restructuring and acquisition-related activity for the fourth quarter of 2024 were $5.6 million. Reflecting the impact of these activities, AAM generated adjusted free cash flow of $79.2 million in the fourth quarter of 2024.

現在讓我們討論現金流和資產負債表。2024 年第四季經營活動提供的淨現金為 1.512 億美元，而 2023 年第四季為 5,290 萬美元。2024 年第四季的資本支出（扣除出售物業、廠房和設備所得收益）為 7,760 萬美元。2024 年第四季重組和收購相關活動的現金支付為 560 萬美元。反映這些活動的影響，AAM 在 2024 年第四季產生了 7,920 萬美元的調整後自由現金流。

For the full year of 2024, AAM generated adjusted free cash flow of $230 million compared to $219 million in 2023. Our increased cash flow was driven by our stronger operational performance, inventory reductions and lower interest costs.

2024 年全年，AAM 產生的調整後自由現金流為 2.3 億美元，而 2023 年為 2.19 億美元。我們現金流的增加得益於我們更強勁的營運表現、庫存減少和更低的利息成本。

From a debt leverage perspective, we ended the year with a net debt of $2.1 billion and LTM adjusted EBITDA of $749.2 million, calculating a net leverage ratio of 2.8x at December 31. This is down nearly half a turn from a year ago at December 31, 2023. During 2024, we redeemed all our remaining 2026 senior notes for a total of nearly $130 million, including approximately $46 million in the fourth quarter. AAM ended 2024 with total available liquidity of approximately $1.5 billion, consisting of available cash and borrowing capacity on AAM's global credit facilities.

從債務槓桿的角度來看，我們今年年底的淨債務為 21 億美元，LTM 調整後 EBITDA 為 7.492 億美元，計算得出 12 月 31 日的淨槓桿率為 2.8 倍。與去年同期的 2023 年 12 月 31 日相比，這一數字下降了近半倍。2024 年，我們贖回了所有剩餘的 2026 年優先票據，總額近 1.3 億美元，其中包括第四季的約 4,600 萬美元。截至 2024 年，AAM 的總可用流動資金約為 15 億美元，包括可用現金和 AAM 全球信貸機構的借貸能力。

Before we move to the Q&A portion of the call, let me provide some thoughts and details on our 2025 financial outlook. In our earnings slide deck, we have included walks from our '24 actual results to our 2025 financial targets and you can see those starting on Slide 11. 2025 will bring about many exciting opportunities for AAM to grow and drive value creation. The guidance figures we are providing today are on an AAM stand-alone pre-combination basis and do not reflect any cost or expenses related to the announced combination with Dowlais. For sales, we are targeting the range of $5.8 billion to $6.05 billion for 2025.

在我們進入電話問答部分之前，讓我先就我們的 2025 年財務展望提供一些想法和細節。在我們的收益幻燈片中，我們涵蓋了從 24 年實際業績到 2025 年財務目標的步調，您可以在第 11 張投影片上看到這些目標。我們今天提供的指導數據是基於 AAM 獨立的合併前數據，並不反映與宣布的與 Dowlais 合併相關的任何成本或費用。對於銷售額，我們的目標是到 2025 年達到 58 億美元至 60.5 億美元。

To begin, the sales target is based upon a North America production of approximately 15.1 million units at the midpoint, and certain assumptions for our key programs such as we anticipate GM's full-size pickup truck and SUV production in the range of 1.3 million to 1.4 million units. In addition, we are assuming the pending sale of our commercial vehicle axle business in India will be completed by the end of the first half of 2025 and our financial guidance reflects that timing as you can see on our walk. From an EBITDA perspective, we are expecting adjusted EBITDA in the range of $700 million to $750 million.

首先，銷售目標以北美約 1510 萬輛的產量為中點，並對我們的關鍵項目做出某些假設，例如，我們預計通用汽車全尺寸皮卡和 SUV 的產量將在 130 萬至 140 萬輛之間。此外，我們預計印度商用車軸業務的出售將在 2025 年上半年末完成，我們的財務指引也反映了這一時間安排，正如您在我們行走中看到的那樣。從 EBITDA 角度來看，我們預期調整後的 EBITDA 在 7 億至 7.5 億美元之間。

Let me provide some color on the key elements of our year-over-year EBITDA walk that is on Page 12. We expect decremental margins for our volume and mix change to be slightly lower than our average of 25% to 30% as our India commercial vehicle margins are lower than our overall average. As mentioned earlier, our focus on optimizing our spend in R&D should yield a year-over-year improvement of $20 million and AAM expects to deliver continued cost reductions, operational productivity and deliver year-over-year efficiency gains. And you can see the year-over-year performance improvements as a net favorable $15 million on our walk.

讓我對第 12 頁上的我們的同比 EBITDA 走勢的關鍵要素進行一些說明。我們預計，由於印度商用車利潤率低於我們的整體平均水平，我們的銷售和產品組合變化的利潤率下降幅度將略低於 25% 至 30% 的平均水平。如前所述，我們專注於優化研發支出，這將帶來 2000 萬美元的同比增長，AAM 預計將繼續降低成本、提高營運效率並實現效率的同比增長。您可以看到，與去年同期相比，我們的業績有所改善，淨利潤為 1500 萬美元。

On Page 10, from an adjusted free cash flow perspective, we are targeting approximately $200 million to $230 million in 2025. The main factors driving our cash flow changes are as follows: we have higher capital expenditures stemming from investments for our largest truck platforms, next-generation products. These are the cornerstones for AAM's revenues and profitability for a long time to come. Even with the scale of these programs, we've been leveraging our installed capital base, driving purchasing efficiency and operational effectiveness, and we are targeting CapEx as a percent of sales in 2025 of approximately 5%.

第 10 頁，從調整後的自由現金流角度來看，我們的目標是到 2025 年達到約 2 億至 2.3 億美元。推動我們現金流變化的主要因素如下：我們對最大的卡車平台、下一代產品的投資增加了資本支出。這些是 AAM 未來很長一段時間內收入和獲利的基石。即使這些項目規模龐大，我們仍在利用我們的已安裝資本基礎，提高採購效率和營運效率，我們的目標是到 2025 年將資本支出佔銷售額的百分比達到約 5%。

Lower outstanding debt also means lower cash interest of approximately $10 million. We do see higher cash taxes in 2025 in the range of $60 million to $70 million in total, which is approximately $15 million higher than 2024. As for working capital, we believe we have continued opportunities across all areas of our working capital in 2025 and expect good performance in this area. And lastly, while not included in our adjusted free cash flow figures, we estimate our restructuring payments to be in the range of $20 million to $30 million for 2025 as we look to further optimize our business and further reduce fixed costs.

未償債務的減少也意味著現金利息減少約 1,000 萬美元。我們確實預計 2025 年的現金稅將增加，總額在 6,000 萬美元至 7,000 萬美元之間，比 2024 年高出約 1,500 萬美元。至於營運資本，我們相信 2025 年我們的營運資本各個領域仍將有機會，並期待該領域取得良好的表現。最後，雖然這筆重組支出未包含在我們調整後的自由現金流數據中，但我們估計，到 2025 年，我們的重組支出將在 2,000 萬至 3,000 萬美元之間，因為我們希望進一步優化業務並進一步降低固定成本。

While we do not provide quarterly guidance, we do want to provide some perspectives on timing in 2025. As it relates to revenue cadence for the year, due to early January downtime at key customers and the continued ramp curve of a key next-generation program launch in North America, we anticipate the first quarter sales per production date to be lower relative to the remainder of the year. In addition, we expect a normal seasonal cash flow use in the first quarter of the year.

雖然我們不提供季度指導，但我們確實希望提供一些有關 2025 年時間表的觀點。就全年營收節奏而言，由於 1 月初主要客戶停工以及北美關鍵下一代計畫的持續成長曲線，我們預計第一季每個生產日期的銷售額將低於今年剩餘時間。此外，我們預計今年第一季的季節性現金流使用將正常。

So taking all that in, what does it mean? It means on a stand-alone basis, AAM is driving increased margins, delivering strong and steady cash flow and positioning its portfolio to support arguably one of the best automotive product franchises around that being North America light trucks. And when we combine with Dowlais and its complementary product set and performance capabilities, this will be an even more exciting company. Thank you for your time and participation on the call today. I'm going to stop here and turn the call back over to David Dauch for his closing remarks regarding our upcoming combination.

那麼綜合考慮這些因素，這意味著什麼呢？這意味著，從獨立角度而言，AAM 正在提高利潤率、提供強勁穩定的現金流，並將其產品組合定位為支持北美輕型卡車等最佳汽車產品特許經營權之一。當我們與 Dowlais 及其互補產品組合和性能能力相結合時，這將成為一家更令人興奮的公司。感謝您今天抽出時間並參與電話會議。我現在要停下來，把電話轉回給 David Dauch，請他針對我們即將進行的組合發表結束語。

David?

戴維？

Thanks, Chris. And before we go into the Q&A session, I wanted to discuss our transformational combination with Dowlais that we announced on January 29. This compelling strategic combination brings together 2 complementary global Tier 1 suppliers to create a leading global driveline and metal forming company in the world. Simply, AAM plus Dowlais creates a more balanced and more resilient company with revenues on a nonadjusted combined basis of approximately $12 billion. Combined adjusted EBITDA margin, including $300 million of run rate synergies of approximately 14% and and we anticipate day 1 net leverage after the impact of the transaction financing of approximately 2.5x, including synergies.

謝謝，克里斯。在我們進入問答環節之前，我想討論一下我們在 1 月 29 日宣布的與 Dowlais 的轉型合併。這個引人注目的策略組合將兩家互補的全球一級供應商整合在一起，打造一家全球領先的傳動系統和金屬成型公司。簡而言之，AAM 加上 Dowlais 打造了一家更平衡、更具彈性的公司，未經調整的綜合收入約為 120 億美元。綜合調整後的 EBITDA 利潤率包括 3 億美元的運行率協同效應，約為 14%，我們預計交易融資影響後的第一天淨槓桿率約為 2.5 倍（包括協同效應）。

Following the close of the transaction, we expect strong earnings accretion in the first full year. Upon closing, AAM will become a top 10 North American and top 25 global supplier. From a diversification standpoint, the combined business benefits greatly from a more balanced customer mix and geographic presence. We anticipate our GM concentricity to reduce to 25% post close from approximately 40% today. As to our geographic presence, our North American dependence reduces to 54% from 73% today, while our European and Asian exposure grows.

交易完成後，我們預計第一年全年獲利將強勁成長。交易完成後，AAM 將成為北美前 10 名和全球前 25 名供應商。從多元化的角度來看，合併後的業務將從更均衡的客戶結構和地理分佈中受益匪淺。我們預計，GM 同心度將從目前的約 40% 降至收盤後的 25%。就我們的地理分佈而言，我們對北美的依賴程度從現在的 73% 降至 54%，而我們對歐洲和亞洲的依賴程度則有所增加。

This improved geographic balance allows us to better serve our customers, where their operations are located, which positions us to grow the business that we already have and importantly, gain new customers.

這種改善的地理平衡使我們能夠更好地服務於我們的客戶及其業務所在地，這使我們能夠發展現有業務，更重要的是，獲得新客戶。

In summary, this strategic combination provides a more robust business model positioned to deliver (technical difficulty) GKN Automotive and GKN Powder Metallurgy. GKN Automotive is a leader in the development and production of side shafts, prop shafts, all-wheel drive systems, e-Drive systems and e-powertrain components. GKN Powder Metallurgy is a global leader of high-performance and precision powdered metal products for the automotive and industrial markets. This transaction brings together a complementary product portfolio with Dowlais strengths in side shafts, coupled with AAM strength in axles. On Slide 18, you'll see that Dowlais is a pioneer of automotive CV joints and is the #1 global supplier of side shafts in the world.

總而言之，這項策略組合提供了更強勁的商業模式，有望實現（技術難度）GKN Automotive 和 GKN Powder Metallurgy 的目標。GKN Automotive 在側軸、螺旋槳軸、全輪驅動系統、電力驅動系統和電子動力總成零件的開發和生產領域處於領先地位。GKN Powder Metallurgy 是汽車和工業市場高性能精密粉末金屬產品的全球領導者。此次交易將 Dowlais 在側軸方面的優勢與 AAM 在車軸方面的優勢結合在一起，形成了一個互補的產品組合。在投影片 18 上，您會看到 Dowlais 是汽車 CV 接頭的先驅，也是全球排名第一的側軸供應商。

Side shafts casts deliver power to the wheels for ICE, hybrid and electric vehicles. Dowlais possesses industry-leading technology and strong vertical integration, which complements and expands AAM's existing capabilities.

側軸鑄件為內燃機汽車、混合動力車和電動車的車輪提供動力。Dowlais 擁有領先業界的技術和強大的垂直整合能力，補充並擴展了 AAM 現有的能力。

As industry transitions to electrification, the content per vehicle opportunity for side shafts increases. This is another great benefit of this powertrain agnostic product line. This strategic combination is expected to deliver approximately $300 million of synergies. We expect run rate savings to be approximately 60% achieved after year 2 and the remainder is substantially achieved by the third year after the deal closes. The transaction positions AAM for high-margin potential, strong earnings accretion and strong cash flow and a strong balance sheet.

隨著產業向電氣化轉型，每輛車的側軸內容機會不斷增加。這是與動力系統無關的產品線的另一個主要優勢。預計這一戰略組合將產生約3億美元的綜效。我們預計，第二年後運行率節省將達到約 60%，其餘部分將在交易結束後的第三年基本實現。此次交易將使 AAM 擁有高利潤潛力、強勁的獲利成長、強勁的現金流和強勁的資產負債表。

We are already making plans to integrate our 2 businesses so that when we close, we will confidently hit the ground running to achieve these synergies which we have a solid track record of delivering with other deals that we have completed over the years.

我們已經在製定計劃，整合我們的兩項業務，以便當我們完成交易時，我們可以滿懷信心地立即開始實現這些協同效應，多年來，我們在完成的其他交易中有著實現這些協同效應的良好記錄。

Furthermore, our confidence to achieve these synergies is very high based on the robust process that we were required to undertake in order to announce our $300 million synergy number. This process included detailed in-person diligence sessions for 10 work streams, which were conducted over multiple weeks between AAM and Dowlais management teams with the support of our respective global consulting firms. This process ultimately resulted in both a quantified synergy report and a supporting opinion being issued by an outside accounting firm. Our process is to identify greater opportunities for what we call a market basket, well in excess of our targets. This supports our ability and our high confidence level to deliver the synergy opportunities.

此外，基於我們宣布 3 億美元協同效應數字所必須經歷的嚴格流程，我們對實現這些協同效應充滿信心。該流程包括對 10 個工作流程進行詳細的面對面盡職調查會議，這些會議由 AAM 和 Dowlais 管理團隊在我們各自的全球顧問公司的支援下歷時數週完成。這個過程最終產生了量化的綜效報告和外部會計師事務所所發出的支持意見。我們的流程是，為我們所謂的市場籃子尋找更大的機會，遠遠超出我們的目標。這增強了我們實現協同機會的能力和高度信心。

As such, on Slide 21, you can see the cash flow generation potential is very strong. Based on reported figures, plus the realization of full synergies or 5% of revenues based on the applied combined market cap of the company, this implies a very attractive 50%, let me say it again, 50% free cash flow yield.

因此，在幻燈片 21 上，您可以看到現金流產生潛力非常強勁。根據報告的數據，加上實現全面協同效應或根據公司綜合市值實現 5% 的收入，這意味著非常有吸引力的 50%，讓我再說一遍，50% 的自由現金流收益率。

Now let's transition to financing the balance sheet and capital allocation. We have fully committed financing in place to support this transaction. and we expect to raise approximately $2.2 billion of new debt financing to refinance Dowlais' existing debt and fund the cash purchase price of the deal. At closing, this deal is anticipated to be approximately net leverage neutral before synergies, and we expect to have ample liquidity available to us. Regarding capital allocation, historically AAM is focused on organic growth and debt paydown.

現在讓我們轉向融資資產負債表和資本配置。我們已承諾提供全額融資來支持此交易。我們預計將籌集約 22 億美元的新債務融資，以再融資 Dowlais 的現有債務並為交易的現金購買價格提供資金。在交易結束時，預計該交易在產生協同效應之前將達到淨槓桿率中性，並且我們預計將擁有足夠的流動性。關於資本配置，從歷史上看，AAM 專注於有機成長和債務償還。

That will remain true in the near term. However, the combined organization with greater size and scale and higher free cash flow generating capability we can now target a more balanced capital allocation policy once we are below 2.5x net leverage, including a strong consideration of returning capital to our shareholders.

短期內這一情況仍將如此。然而，合併後的公司規模更大，自由現金流產生能力更強，一旦我們的淨槓桿率低於 2.5 倍，我們現在就可以製定更平衡的資本配置政策，包括大力考慮向股東返還資本。

Finally, on the regulatory front, AAM and Dowlais have already done a significant amount of analysis and preparatory work and have already actioned a number of items. On February 7, AAM submitted its U.S. regulatory filing. Additionally, AAM is progressing with other country filings and engaging with appropriate regulators. We expect regulatory approval and closing in the fourth quarter of this year, and we are happy to share that initial customer feedback has been supportive given the complementary nature of the product and the customer portfolios.

最後，在監管方面，AAM 和 Dowlais 已經完成了大量的分析和準備工作，並採取了多項行動。2 月 7 日，AAM 提交了美國監管文件。此外，AAM 正在推動其他國家的備案工作並與相應的監管機構接洽。我們預計今年第四季將獲得監管部門的批准和完成，我們很高興地告訴大家，鑑於該產品和客戶組合的互補性，初步客戶回饋是支持性的。

We are extremely excited about the strategic combination as it will create an organization with meaningful size and scale and synergy opportunities a more robust business model based on compelling strategic rationale and industrial logic, a powertrain agnostic product portfolio while realizing enhanced diversification a strong experience and blended management team with a proven track record for success, significant margin and earnings accretion while accelerating opportunities for growth. And finally, strong value creation for all stakeholders, including an enhanced capital allocation policy in the near future.

我們對這項策略合併感到非常興奮，因為它將創建一個具有重大規模和協同機會的組織，一個基於令人信服的戰略原理和工業邏輯的更強大的商業模式，一個動力系統無關的產品組合，同時實現增強的多樣化，一個豐富的經驗和混合的管理團隊，擁有成功的記錄，顯著的利潤和收益增長，同時加速增長機會。最後，為所有利害關係人創造強大的價值，包括在不久的將來加強資本配置政策。

In conclusion, AAM delivered strong 2024 financial results. We are positioned to have a solid year in 2025 as a stand-alone company, and we are excited about the future strategic combination with Dowlais. So thank you for your participation today. Before I turn it over to David Lim to start the Q&A portion of the call, we also want to let you know that we are planning to do investor meetings in New York and Boston for current and prospective shareholders, we have shown interest in AAM. These meetings will be held on February 24 and February 25, respectively.

總之，AAM 取得了強勁的 2024 年財務表現。我們計劃在 2025 年作為一家獨立公司取得豐碩成果，我們對未來與 Dowlais 的策略合併感到非常興奮。非常感謝你們今天的參與。在我將話題轉交給 David Lim 開始電話會議的問答部分之前，我們還想讓您知道，我們計劃在紐約和波士頓為現有和潛在股東舉行投資者會議，我們對 AAM 表現出了興趣。這兩次會議將分別於2月24日和2月25日舉行。

Please feel free to e-mail david.lim@aam.com to register your interest. I will now turn it back over to David Lim to start the Q&A portion of our call. David?

請隨時發送電子郵件至 david.lim@aam.com 來註冊您的興趣。現在我將把話題轉回給 David Lim，開始電話會議的問答部分。戴維？

Thank you. So operator, can you start with the question-and-answer session, please?

謝謝。接線生，可以開始問答環節嗎？

(Operator Instructions) John Murphy, Bank of America.

（操作員指示）美國銀行的約翰·墨菲。

I just have a couple here. David, when you were mentioning -- or Chris, maybe when you're going through the walk on the outlook, you mentioned mix and volume. I'm just curious if you could talk about sort of that in the context of GM trucks and then also the Ram HD, what your expectations are on those 2 specific programs for mix?

我這裡只有幾對。大衛，當您提到 - 或者克里斯，也許當您在展望未來時，您提到了組合和數量。我只是好奇，您是否可以談談通用卡車以及 Ram HD 方面的事宜，您對這兩個特定的混合項目有何期望？

Yes. So the underpinning at the macro level, John, 15.1 million North American units overall. From the T1 perspective or the GM full-size truck, I should say, Think about the range of our revenue mix anywhere from 1.3 million units to 1.4 million units for the full year. And then some of our other top platforms, like, for example, the upcoming Ram HD platform, as you know, has been transitioning model years at the end of last year, beginning of this year. Big picture, we would see that relatively flattish year-over-year because there was declines in the fourth quarter.

是的。因此，從宏觀層面來看，約翰，北美總體上有 1510 萬台。從 T1 角度或通用全尺寸卡車的角度來看，我應該說，想想我們全年的收入組合範圍從 130 萬輛到 140 萬輛。然後，我們的其他一些頂級平台，例如即將推出的 Ram HD 平台，如您所知，已於去年年底和今年年初過渡車型年份。從總體來看，我們會看到同比相對持平，因為第四季度出現了下滑。

We expect lower volumes in the first quarter, but then picking back up the production run rates in the second quarter and beyond...

我們預計第一季的產量會較低，但第二季及以後生產運行率將回升…

Just maybe in that T1, is there something going on with mix in that platform where you think it might be less maybe less 4s? Or is it -- is that mix relatively flat?

只是也許在 T1 中，該平台的混合中是否存在一些事情，您認為它可能會少於 4s 嗎？還是——這種混合相對比較平穩？

It's relatively flat. We continue -- from that perspective, we continue to see strong robust demand on the HD, the heavy-duty side in terms of, I'd call it, platform mix inside of that and obviously strong mix still also on the SUV. But from a 4-wheel drive perspective, relatively flat.

它比較平坦。從這個角度來看，我們繼續看到對 HD 和重型車輛的強勁需求，我稱之為其中的平台混合，顯然 SUV 也具有強勁的混合。但從四輪驅動的角度來看，相對平坦。

Got it. And then just a follow-up on Delhi. The R&D, it's down $20 million, and the CapEx is down $50 million in your outlook for 2025. Is that -- is there kind of a -- is that organic? Or is there some kind of precursor of understanding that you might be able to use some of the capital at Dowlais, particularly on the capacity side and some of the R&D from some of their products.

知道了。然後是關於德里的後續問題。在您對 2025 年的展望中，研發費用下降了 2,000 萬美元，資本支出下降了 5,000 萬美元。那是——有某種——那是有機的嗎？或者是否有某種先兆，表明您可能能夠使用 Dowlais 的部分資本，特別是產能方面以及部分產品的研發資金。

to overlay and save even before you get to the close? Or is this really stuff that you're doing purely on an organic basis?

在結束之前是否進行疊加並保存？或者這真的是你純粹有機地做的事情？

Yes. This is purely organic, John. The guidance is our stand-alone company guidance perspective.

是的。這純粹是有機的，約翰。該指導是我們獨立的公司指導觀點。

Got it. And then just lastly, Dowlais, you mentioned the customer reception was pretty good or actually very good, I should say. But can you talk about the customer reception outside of the D3 and the incumbent European companies? I mean has there been any your commentary from the Asian brands or the Chinese brands that might lead you to believe that you might have a real revenue synergy above and beyond what you're talking about so far?

知道了。最後，Dowlais，您提到客戶接待情況相當好，或者實際上應該說非常好。但您能談談 D3 和現有歐洲公司以外的客戶接待情況嗎？我的意思是，您對亞洲品牌或中國品牌的評論是否讓您相信，您可能擁有超出您目前所談論的真正的收入協同效應？

Yes, John, this is David. Again, on the Detroit 3, everything is very positive in regards to the initial discussions we had with them outside of the Detroit 3 to your question, Again, people are excited about 2 complementary businesses coming together. The product portfolio becomes more expansive. Therefore, we'll be able to cross-sell and have greater opportunities with different customers around the world. They like the stability and the technology and the innovation that both companies bring to the table.

是的，約翰，這是大衛。再次，關於底特律三巨頭，就您在問題之外與我們進行的初步討論而言，一切都非常積極，再次，人們對兩家互補企業的合併感到非常興奮。產品組合變得更加廣泛。因此，我們將能夠進行交叉銷售，並與世界各地的不同客戶擁有更大的機會。他們喜歡兩家公司帶來的穩定性、技術和創新。

So that's important. At the same time, remember, Dowlais has a very important joint venture in China. There's obviously a relationship that we want to maintain and continue there and grow that. There will be meetings that will be upcoming with respect to the leadership of that joint venture and the ultimate customers. But it's been overall positively received in Europe, in Asia and here in North America.

所以這很重要。同時，請記住，Dowlais 在中國擁有非常重要的合資企業。顯然，我們希望維持、延續並發展這段關係。合資企業的領導階層和最終客戶將會舉行會議。但它在歐洲、亞洲和北美總體上都受到了正面的評價。

So we're very happy with the initial feedback from the customers.

因此，我們對客戶的初步回饋感到非常滿意。

James Picariello, BNP.

英國國家黨人士詹姆斯·皮卡里洛 (James Picariello) 表示。

This is Jake on for James. So I think we all appreciate the level of detail you've given us on some of these cost synergies and how that flows through to pro forma free cash flow but can you just talk a little bit about maybe any top line synergies you see, especially given the kind of complementary nature of the portfolios?

這是傑克代替詹姆斯上場。所以我認為我們都很欣賞您提供的有關這些成本協同效應的詳細信息以及它如何影響形式上的自由現金流，但您能否談談您看到的任何頂線協同效應，特別是考慮到投資組合的互補性質？

Well, as I just mentioned, I mean, you're bringing together 2 very complementary businesses whose product portfolios, support and are complementary and expansive to 1 another. So there's going to be cross-selling opportunities, we think, with multiple customers globally around the world. So we definitely see opportunity for revenue growth that way. We also recognize and understand that they are innovative and technology-leading based company. We've done similar things.

嗯，正如我剛才提到的，我的意思是，你們將兩家非常互補的企業整合在一起，它們的產品組合、支援彼此互補且具有擴展性。因此，我們認為，與全球多個客戶合作將會有交叉銷售的機會。因此我們確實看到了這種收入成長的機會。我們也體認並理解他們是一家創新、技術領先的公司。我們也做過類似的事。

We both have positioned ourselves very well on the electrification front, when the markets take off there. And obviously, that's going to vary by region of the world, where China is already leading that active.

當電氣化市場開始起飛時，我們都已經在電氣化領域佔據了非常有利的地位。顯然，這將因世界不同地區而異，中國在這方面已經處於領先地位。

Europe is moving along because the CO2 requirements changing meaning getting tougher. And then in North America, we know that it's slowing down a little bit here under the Trump administration. But regardless of the administration, we're putting ourselves in a position that we have a product powertrain agnostic product portfolio that can support the consumer requirements and the market requirements on a go-forward basis. And we see tremendous opportunity and flexibility and optionality with our portfolio. especially as we bring these 2 dynamic and positive companies together.

歐洲正在前進，因為二氧化碳要求的改變意味著越來越嚴格。而在北美，我們知道在川普政府的領導下，這一成長有所放緩。但無論管理如何，我們都將擁有與產品動力系統無關的產品組合，可以持續支持消費者需求和市場需求。我們看到我們的投資組合具有巨大的機會、靈活性和可選性。特別是當我們將這兩家充滿活力和積極的公司合併在一起時。

And could you guys also just kind of help me with the free cash flow bridge. So at the midpoint, your EBITDA was down about $30 million, CapEx up about $50 million, and you've managed to hold free cash flow more or less flat year-over-year. So is there any working capital benefit that's driving that? And should we think about some sort of potential unwind in 2026? Or is this a number that could potentially continue to move higher once we get through the next-generation GM full-size launch?

你們能不能幫我解決自由現金流問題？因此，在中間點，您的 EBITDA 下降了約 3000 萬美元，資本支出增加了約 5000 萬美元，並且您設法保持自由現金流與去年同期基本持平。那麼，是否有營運資金效益推動了這現象呢？我們是否應該考慮 2026 年可能出現的某種放鬆？或者說，一旦我們完成下一代通用汽車全尺寸車型的發布，這個數字可能會繼續走高嗎？

Yes, jake, this is Chris. I'll take that. You can see our free cash flow bridge on Page 13 of our earnings deck. Another contributor to favorable cash flow is we do expect some favorability as it relates to lower interest expense as we've been paying down our debt. But from a working capital perspective, that's going to be a key driver for us here in 2025.

是的，傑克，這是克里斯。我接受。您可以在我們的損益表第 13 頁上看到我們的自由現金流橋。有利現金流的另一個貢獻因素是，我們確實預期會出現一些有利因素，因為這與較低的利息支出有關，因為我們一直在償還債務。但從營運資金的角度來看，這將成為我們 2025 年發展的關鍵驅動力。

From an inventory perspective, we see still continued opportunity there. From a turns basis, we've been relatively flat year-over-year, which means we have opportunity to continue to reduce that down to levels we ran pre-COVID stabilizing across the industry. In addition, from our payables and receivables or let's call it the traditional type of working capital elements, we see some additional opportunity inside those sets as well. So we're excited to get at that working capital. And I would not really envision any unwind of inventory or others as we clear through '25 on these structural changes for working capital.

從庫存角度來看，我們看到那裡仍然存在機會。從營業額來看，我們的營業額比去年同期相對持平，這意味著我們有機會繼續將其降低至 COVID 之前的水平，從而使整個行業保持穩定。此外，從我們的應付款項和應收款項，或我們稱之為傳統類型的營運資本要素，我們也看到了這些集合中的一些額外的機會。因此我們很高興獲得這筆營運資金。當我們完成 25 年的營運資本結構變更時，我實際上並沒有想到會出現任何庫存或其他方面的緩解。

Edison Yu, Deutsche Bank.

德意志銀行的 Edison Yu。

First Great. Wanted to ask on the transaction and maybe more of a strategic or higher level point of view, it seems that we've seen a lot of suppliers kind of go the opposite way, where they're getting smaller breakout kind of the approach of getting bigger and expanding. So I'm curious, you look down whatever, 3, 4, 5 years. What do you think the supplier landscape looks like? Is it kind of be more your direction that more people are going to consolidate?

第一大。想問關於交易的問題，也許更多的是從戰略或更高層次的角度問，似乎我們已經看到很多供應商朝著相反的方向發展，他們採用規模較小的突破方式，而不是規模較大、擴張的方式。所以我很好奇，你展望未來 3、4、5 年的情況。您認為供應商的格局是什麼樣的？您的方向是否更傾向於讓更多的人參與整合？

Or do you think that actually this other kind of counter trends that's been happening over the last couple of years actually is the way it goes.

或者您認為過去幾年中出現的另一種相反趨勢實際上就是事情發展的趨勢。

Listen, this is David Dauch. I've been saying for years that I feel that the automotive market needs to consolidate, both at the OEM level as well as and especially at the supplier level. I'm still true to my convictions that way and my belief in our thought process. Our team feels very strongly about that. That's why we've done a lot of the acquisitions that we've done.

聽著，我是 David Dauch。多年來我一直在說，我覺得汽車市場需要整合，無論是在 OEM 層面，還是在供應商層面。我仍然堅持我的信念以及我對我們的思考過程的信念。我們的團隊對此深有感觸。這就是我們進行大量收購的原因。

The biggest one to do what we did to as MPG back in 2017 but now this is even bigger here with Dowlais here in 2025. We think the markets are very uncertain, very dynamic, and you need size and scale to be able to weather the storm and and be in a position that you can balance the requirements that are out there. And there's new challenges every day that the market brings or countries or regions bring and we need to be in a position to leverage those global resources, those expansive resources that we have.

最大的一個是我們在 2017 年對 MPG 所做的，但現在這個數字甚至更大，2025 年將有 Dowlais 出現。我們認為市場非常不確定，非常動態，你需要規模和範圍來渡過難關，並且能夠平衡現有的需求。市場、國家和地區每天都會帶來新的挑戰，我們需要利用我們擁有的全球資源和廣泛的資源。

But most importantly, when it's all said and done, we've got to bring solutions to our customers that meet their needs and ultimately meet the market needs, being in the consumer in what they want. And we think bringing together 2 complementary companies with an expansive product portfolio that's very complementary to one another with very little overlap. We're doing just what the market and what our customers need. And we're very pleased with the strength that they have with their leadership team, combined with our leadership team, we'll blend that together. We'll have a leading and proven management team that has tremendous experience, and we'll be able to manage that effectively going forward.

但最重要的是，歸根結底，我們必須為客戶提供滿足其需求的解決方案，並最終滿足市場需求，成為消費者想要的東西。我們認為將兩家互補的公司合併在一起，擁有廣泛的產品組合，彼此之間具有很強的互補性，而且重疊很少。我們做的正是市場和客戶所需要的。我們對他們的領導團隊的實力感到非常滿意，加上我們的領導團隊，我們將把兩者融合在一起。我們將擁有一支經驗豐富的領先且久經考驗的管理團隊，並且我們將能夠在未來有效地管理他們。

Yes, there are some people that are taking actions to reduce their concentricity in different regions or actually not of certain businesses.

是的，有些人確實採取行動減少他們在不同地區的同心度，或者實際上不是某些企業的同心度。

What we're trying to do is make sure that we have a powertrain agnostic portfolio that can meet the requirements no matter what the market conditions are on a global basis. And we're still true to that. At the same time, we recognize that each region requires a different strategy. But holistically, there's a way that we can bounce that out and be efficient from an operations standpoint and from a product development and from a cash management standpoint going forward. So long answer to your question, but the short answer to it is we feel very strongly that the markets will continue to consolidate going forward.

我們試圖確保我們擁有與動力系統無關的產品組合，無論全球市場狀況如何，它都能滿足要求。我們依然堅持這一點。同時，我們認識到每個地區需要不同的策略。但從整體來看，我們有辦法解決這個問題，並且從營運、產品開發和現金管理的角度提高效率。對於您的問題，答案很長，但簡短的回答是，我們非常強烈地感覺到市場將在未來繼續整合。

That's the whole premise of our strategic rationale and industrial logic. Not only do we feel that way, the Dowlais Board and management team feels that way as well and others that I've talked to in the industry also feel that way.

這就是我們的戰略原理和產業邏輯的全部前提。不僅我們有這種感受，Dowlais 董事會和管理團隊也有這種感受，而且我交談過的業內其他人也有這種感受。

Appreciate the insights. A follow-up on the Dowlais side. For those of us maybe not as close. You've got quite a bit of time to do work. The Chinese business, the China business under is actually quite strong, I think, maybe to many people surprise.

感謝您的見解。對 Dowlais 方面的後續行動。對我們這些人來說可能並沒有那麼親近。您有充足的時間來做工作。我認為，中國業務實際上相當強勁，這可能會讓很多人感到驚訝。

Can you maybe, from your perspective, maybe describe why that is given just the level of competition there. I think we're kind of from the U.S. perspective under impression that the local suppliers would be doing much better. So just curious as to why maybe you think they're actually holding up quite what you're doing quite well there.

您能否從您的角度來看待這種情況，因為那裡的競爭水平相當？我認為，從美國的角度來看，我們的印像是當地供應商的表現會好得多。所以我只是好奇，為什麼你可能認為他們實際上在支持你在那裡做得很好。

Well, I mean, I think you have to recognize, first and foremost, the 2 joint venture partners that being at ASCO and that be in GKN and the management teams and the strategy that they put together for that JV. That JV is 35 years old. There's been a lot of experience there. They're tailored in design, China for China as far as support the local market. They've got an effective product portfolio heavily weighted towards cash at but also supporting all-wheel drive and electrification and e powertrain components for that market, which is what's in demand.

嗯，我的意思是，我認為你必須先認識到 ASCO 和 GKN 的兩個合資夥伴以及管理團隊和他們為該合資企業製定的策略。該合資企業已有 35 年歷史。那裡有很多經驗。它們的設計都是針對中國本土市場量身定制的，以支持當地市場。他們擁有有效的產品組合，主要以現金為主，但也支援全輪驅動、電氣化和電子動力總成組件，這正是市場所需要的。

They've got a competitive cost structure and a supportive management team. that is growing both with the domestic Chinese manufacturers or OEMs as well as with the international or Western OEMs that are doing business in China. So credit to those 2 organizations. So we had nothing to do with that.

他們擁有具有競爭力的成本結構和支援性的管理團隊。這一成長不僅體現在中國國內製造商或原始設備製造商身上，也體現在中國開展業務的國際或西方原始設備製造商身上。因此，我們要向這兩個組織表示感謝。所以我們與此無關。

However, what we want to do is make sure that we not only maintain the relationship but build on that relationship, especially as our product portfolio expands as a combined business. And then we'll look to bring other operational excellence and support to that joint venture going forward. But don't mess with something as you said, it's performing very well. So we just got to meet that management team that's over there and that new partner going forward. And appropriate meetings will take place first and foremost between Dole and their existing partner and then we'll follow up with the appropriate meetings with myself and others to meet their leadership team and position ourselves and talk about what the future holds.

然而，我們希望確保我們不僅能維持這種關係，而且能進一步發展這種關係，特別是當我們的產品組合作為合併後的業務而擴大時。然後，我們將期待為該合資企業帶來其他卓越的營運和支援。但不要像你說的那樣弄亂某些東西，它的性能非常好。因此，我們剛剛見到了那裡的管理團隊和新的合作夥伴。首先，都樂將與其現有合作夥伴舉行適當的會議，然後，我們將與我本人和其他人舉行適當的會議，與他們的領導團隊會面，確定我們的定位，並討論未來的發展。

Doug Karson, Bank of America.

美國銀行的道格·卡森（Doug Karson）。

I'm kind of excited about the scale getting bigger. In my career, I think rating agencies kind of like bigger auto suppliers, which helped give you some math relative to the market pressures. And you're actually merging with a company that had lower leverage than AAM and the combined entity, I think out of the gate, I think you said to be about 2.5 turns of leverage. I think you made some comments that maybe going forward, you'll be able to harvest some of the cash flow to get back to equity rather than the delevering that we've seen in the last few years. So one, want to just kind of explore that a little bit.

我對規模越來越大感到有點興奮。在我的職業生涯中，我認為評級機構有點像更大的汽車供應商，它可以幫助您根據市場壓力進行一些數學計算。而您實際上是在與一家槓桿率低於 AAM 的公司合併，我認為合併後的實體一開始的槓桿率就約為 2.5 倍。我認為您說過，也許在未來，您將能夠收穫部分現金流以恢復股權，而不是像過去幾年那樣去槓桿。因此，首先我想稍微探索一下這一點。

And then separately, I know the agency has kind of commented. But do you think longer term, you could safely get the combined entity more into the mid-BB range rather than B range for ratings given the scale almost double.

另外，我知道該機構已經發表了一些評論。但是，您是否認為，從長遠來看，考慮到合併後的實體的評級幾乎翻倍，您可以放心地將其置於 BB 中間範圍，而不是 B 範圍？

Yes, Doug, you have a few questions in there. This is Chris. I'll take a crack at a few of those. First of all, we agree with your enthusiasm about the size and the scale but as it relates to delevering, if you listen to some of our comments, we talked about at 2.5x, we would open up to some additional capital allocation priorities. But before that happens, we will continue to reduce and strengthen our balance sheet down into the 2.5x.

是的，道格，你有幾個問題。這是克里斯。我將嘗試其中的一些。首先，我們同意您對規模和範圍的熱情，但就去槓桿而言，如果您聽取我們的一些評論，我們在 2.5 倍時談到，我們會開放一些額外的資本配置優先事項。但在此之前，我們將繼續減少並加強我們的資產負債表，直至 2.5 倍。

So we'll continue to prioritize the organic growth. We'll continue to prioritize debt repayment and drive a stronger and stronger balance sheet through that process. So I think that's a key point to keep in mind. And then we would have a balanced portfolio or balanced capital allocation going forward, which would still include an element of debt reduction as well. It wouldn't be solely overweight to one versus the other.

因此，我們將繼續優先考慮有機成長。我們將繼續優先償還債務，並透過此過程推動資產負債表越來越強勁。所以我認為這是需要牢記的關鍵點。然後，我們將擁有一個平衡的投資組合或平衡的資本配置，其中仍然包括減少債務的因素。這不會只是對一方的超重，對另一方的超重。

Right.

正確的。

But longer term, obviously, driving higher ratings is critical to cost of capital. But -- so we're focused on the elements of those, whether the agencies rewrite us or not, that's up to them. But we're focused on strengthening the balance sheet reducing our leverage, the size and scale, free cash flow to debt ratios, things of that nature, elements of our business that are good for the business will ultimately drive to a stronger company and hopefully will reflect in the ratings over time.

但從長期來看，顯然提高評級對於資本成本至關重要。但是——所以我們專注於這些要素，無論機構是否重寫我們，這都取決於他們。但我們專注於加強資產負債表，降低槓桿率、規模和範圍、自由現金流與債務比率等性質的事情，對我們業務有利的要素最終將推動公司變得更加強大，並希望隨著時間的推移反映在評級中。

That's helpful. And then maybe just a quick follow-up. There's obviously a lot of headlines around tariffs and steel prices. And I know that you've got some pretty good pass-through capabilities in. Can you just kind of refresh us on how you're looking at some of those commodity risks out there in the market broadly.

這很有幫助。然後可能只是一個快速的跟進。顯然，關稅和鋼鐵價格成為許多新聞頭條的焦點。而且我知道您擁有相當出色的傳遞能力。您能否簡單介紹一下您如何看待市場上的一些商品風險。

Doug, this is David. I'll take the first shot and then Chris can comment on it. But I think you know and others know, and we've been very forthright that our long-standing policy has been to buy and build local in the regions that we support and that we serve, and that's proved very effective to us in mitigating tariff risk that we're experiencing in the past, but also propensity experience here in the future. We'll obviously look to mitigate any other impact that may happen once they get announced in regards to what's going on between the U.S., with Canada and Mexico, and we'll see where that goes in March.

道格，這是大衛。我會先拍攝，然後克里斯可以對其發表評論。但我想你和其他人都知道，我們一直非常坦率地表示，我們的長期政策是在我們支持和服務的地區購買和建造本地產品，事實證明這對我們非常有效，不僅可以降低我們過去遇到的關稅風險，還可以降低未來的傾向性經驗。一旦美國、加拿大和墨西哥之間的協議宣布，我們顯然會設法減輕可能產生的任何其他影響，我們將在三月觀察事態的發展。

With respect to steel and the aluminum side right now, we have very minimal exposure as our U.S. deal and our aluminum is sourced here locally. So we feel very good about where we are that way. we just got to understand what the details are going to be with respect to the tariff strategy or policies between the U.S., Mexico and Canada as well as any other countries that may be involved longer term. But Overall, like I said, our strategy is to buy and build local and that benefits us when you have tariff issues or trade war issues that are taking place.

目前就鋼鐵和鋁而言，我們的風險敞口非常小，因為我們的交易是美國的，而且我們的鋁都是在當地採購的。所以我們對於目前的狀況感到非常滿意。我們只是想了解美國、墨西哥、加拿大以及其他可能長期參與的國家之間的關稅戰略或政策的細節。但總的來說，就像我說的，我們的策略是購買和建造本地產品，當出現關稅問題或貿易戰問題時，這將使我們受益。

So Chris, any other comments on.

那麼克里斯，還有其他評論嗎？

Yes. And when you referred to Doug, some of the pass-through mechanisms, if this activity brings more volatility to the input costs, not tariff-related, but that are driving the commodity costs that go into our product. As you know, we pass around 80% plus up and down to the customer by contract on this. So we are insulated and protected from some of that site, not tariffs, but the market inputs that impact our purchases through our supply base. So that's a nice protection mechanism for the company.

是的。當您提到道格 (Doug) 時，一些轉嫁機制，如果這種活動為投入成本帶來更多波動，與關稅無關，但這會推動我們產品的商品成本。如您所知，我們根據合約將大約 80% 以上的費用轉嫁給客戶。因此，我們受到了一些保護，這些保護不是針對關稅，而是針對透過我們的供應基地影響我們採購的市場投入。這對公司來說是一種很好的保護機制。

Yes. That is good. That's it from me.

是的。那很好。我要說的就這些。

Yes. Thanks, Doug. Appreciate it.

是的。謝謝，道格。非常感謝。

Dan Levy, Barclays.

巴克萊銀行的丹‧利維 (Dan Levy)。

[Josh] on for Dan today. I had a question on just backlog and bidding dynamics. I know you've said in the past couple of quarters that there's a bit of air pocket while the OEMs consider the EV plans. And I saw today that there is an extension on the Ford program, which, I guess, would not be included in backlog just wanted to see how things are going with bidding and if you're seeing a greater extension interest right now?

[喬許] 今天代替丹。我有一個關於積壓和競標動態的問題。我知道您在過去幾個季度中說過，在原始設備製造商考慮電動車計劃時，存在一些空洞因素。我今天看到福特計劃有一個延期，我猜這不會包括在積壓訂單中，只是想看看競標的進展如何，以及您是否看到現在有更大的延期興趣？

Yes. So this is David, and I'll let Chris talk from there. As we've said all along, with the OEMs reevaluating their product portfolios right now, it is creating a bit of an air pocket in regards to some of the sourcing here in the initial years, meaning, let's say, over the next 3 years. But at the same time, we've been very forthright in regards to what our backlog has been over the last 3 years, and there's not a meaningful change there. for '25, slightly lower just based on some of the retiming and re-volumes of some of the programs that the customers put forward.

是的。這是大衛，我讓克里斯開始講話。正如我們一直所說的那樣，由於 OEM 正在重新評估其產品組合，因此在最初幾年（也就是未來 3 年）的一些採購方面會出現一些空白。但同時，我們對過去 3 年積壓的工作情況非常坦率，並且沒有任何重大變化。對於'25，價格會略低，這只是基於客戶提出的部分程序的重新定時和重新音量。

I think the most important thing for us and the big swing that we're seeing right now is we're still actively quoting about $1.5 billion of new and incremental opportunities. And again, our backlog is only new and incremental. We don't count any replacement business in that.

我認為對我們來說最重要的事情以及我們現在看到的巨大變化是，我們仍在積極引用約 15 億美元的新增量機會。再次強調，我們的積壓工作都是新的、增量的。我們不計算任何替代業務。

But on that new and incremental business that we're quoting, in the past couple of years, that was heavily weighted towards electrification, like 75% to 80%. Today, that has swung the other way, where we still have some electrification in it, but it's more heavily weighted towards ICE and hybrid applications going forward. So what we're very excited about is the fact that, one, we've got our next-generation business essentially and substantially secured, which I covered in my earlier remarks. Two, we're actively quoting on $1.5 billion of new and incremental business and it's right in our wheelhouse of our ICE and hybrid business today but at the same time, 3, we have -- already have an existing portfolio, and that portfolio will expand with Dowlais that better positions us for the powertrain agnostic portfolio to quote on more electrification requirements as they evolve based on the different markets globally around the world.

但在我們所引用的新業務和增量業務中，過去幾年來，電氣化佔了很大比重，大約佔了 75% 到 80%。如今，情況已經發生了變化，我們仍然擁有一些電氣化，但未來將更加專注於內燃機和混合動力應用。因此，我們非常興奮的是，首先，我們的下一代業務基本上已經得到了充分保障，我在先前的評論中已經提到過這一點。第二，我們正在積極為 15 億美元的新業務和增量業務提供報價，這正好是我們目前內燃機和混合動力業務的重心，但與此同時，第三，我們已經有一個現有的產品組合，這個產品組合將隨著 Dowlais 的加入而擴大，這使我們能夠更好地定位動力系統無關的產品組合，以便根據全球不同市場的發展，對全球不同的電氣化要求進行更新。

And then we'll also be able to leverage the global footprint of the 2 organizations to better position ourselves from a cost effectiveness standpoint so that we improve our hit rate of trying to win that new business going forward. But overall, and we feel good about the market basket of opportunities. There is an air pocket going through the industry, not only for AAM but many suppliers. But most importantly, a lot of the programs are being extended which is a positive because that allows us to continue to drive operational efficiency and financial performance which we delivered in '24, and we were positioned to deliver as a stand-alone company in '25 and obviously, we've conveyed what we think the synergies are and the incremental opportunities when we bring Dowlais and American Axle together.

然後，我們也將能夠利用這兩個組織的全球影響力，從成本效益的角度更好地定位自己，從而提高我們在未來嘗試贏得新業務的命中率。但總體而言，我們對市場機會感到樂觀。整個產業都存在著一個空洞，不僅是 AAM，許多供應商也是如此。但最重要的是，許多項目正在延長，這是積極的一面，因為這使我們能夠繼續推動我們在24年實現的營運效率和財務業績，並且我們將在25年作為一家獨立公司實現這一目標，顯然，我們已經傳達了我們認為的協同效應以及將 Dowlais 和 American Axle 合併後將帶來的增量機會。

So as a quick follow-up on that, of the R&D decline year-over-year, would you say a lot of that is within your spending given the slowdown and assuming there's an uptick in hybrid over the next couple of years, would that require any incremental spending beyond your current portfolio? Or is that kind of already included in what you already have?

因此，作為對此的快速跟進，在研發支出逐年下降的情況下，考慮到經濟放緩，您是否認為其中很大一部分是在您的支出之內，並且假設未來幾年混合動力汽車會出現上升趨勢，這是否需要在您目前的投資組合之外增加支出？或者這已經包含在您已有的內容中了？

Yes. I would say -- Josh, this is Chris. The R&D decline is to align really with current market requirements, demands of our customers. Part of our elevated spend over the past year or 2 has been to build out our eDrive portfolio, which we now have in place. and has gained a lot of traction in China and other markets as well.

是的。我想說——喬希，這是克里斯。研發的減少是為了真正滿足當前的市場需求和客戶的需求。我們在過去一兩年中增加的支出的一部分用於建立我們的 eDrive 產品組合，目前我們已經建立了該產品組合。並且在中國和其他市場也獲得了極大的發展動力。

So that's sort of done and behind us, so we can now start to reap the cost benefits of sort of repositioning with the current market dynamics and harvest those savings this year, and we would expect going forward. The nice thing about the hybrid applications for us, in many cases, uses the exact same product as our ICE vehicle products. So there's not a lot of R&D associated with that. So that's a perfect alignment of some of that powertrain applications between ICE and a hybrid perspective.

所以這些都已經完成了，而且已經過去了，所以我們現在可以開始收穫根據當前市場動態重新定位所帶來的成本效益，並在今年獲得這些節省，我們也期待未來能夠繼續前進。對我們來說，混合動力應用的優點在於，在許多情況下，它使用的產品與我們的 ICE 汽車產品完全相同。因此，與此相關的研發並不多。因此，從 ICE 和混合動力視角來看，這是某些動力系統應用的完美結合。

Thank you. I think that was our last question, and we thank all of you who have participated on this call and appreciate your interest in AAM. We certainly look forward to talking with you in the future.

謝謝。我想這是我們的最後一個問題，我們感謝所有參加這次電話會議的人，並感謝您對 AAM 的關注。我們當然期待將來與您交談。

Thank you. This concludes today's conference call. You may now disconnect your lines, and have a wonderful day.

謝謝。今天的電話會議到此結束。現在您可以斷開連接，享受美好的一天。