EX-99.1 2 a2052021adientform8-kex991.htm EX-99.1 Document
Exhibit 99.1
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Appendix
Page 1

Adient plc
Condensed Consolidated Statements of Income
(Unaudited)

Three Months Ended
December 31,
(in millions, except per share data)20202019
Net sales$3,848 $3,936 
Cost of sales3,507 3,673 
Gross profit341 263 
Selling, general and administrative expenses149 165 
Loss on business divestitures - net— 25 
Restructuring and impairment costs7 2 
Equity income (loss)97 (113)
Earnings (loss) before interest and income taxes282 (42)
Net financing charges59 48 
Other pension expense (income)(2)(2)
Income (loss) before income taxes225 (88)
Income tax provision (benefit)52 54 
Net income (loss)173 (142)
Income attributable to noncontrolling interests23 25 
Net income (loss) attributable to Adient$150 $(167)
Diluted earnings (loss) per share$1.58 $(1.78)
Shares outstanding at period end94.0 93.8 
Diluted weighted average shares94.8 93.7 



Appendix
Page 2

Adient plc
Condensed Consolidated Statements of Financial Position
(Unaudited)


December 31,September 30,
(in millions)20202020
Assets
Cash and cash equivalents$1,820 $1,692 
Accounts receivable - net
1,432 1,641 
Inventories711 685 
Assets held for sale57 43 
Other current assets476 421 
Current assets4,496 4,482 
Property, plant and equipment - net1,606 1,581 
Goodwill2,109 2,057 
Other intangible assets - net445 443 
Investments in partially-owned affiliates838 707 
Assets held for sale27 27 
Other noncurrent assets1,023 964 
Total assets$10,544 $10,261 
Liabilities and Shareholders' Equity
Short-term debt$19 $210 
Accounts payable and accrued expenses2,580 2,553 
Liabilities held for sale59 46 
Other current liabilities926 1,010 
Current liabilities3,584 3,819 
Long-term debt4,342 4,097 
Other noncurrent liabilities779 767 
Redeemable noncontrolling interests42 43 
Shareholders' equity attributable to Adient1,452 1,213 
Noncontrolling interests345 322 
Total liabilities and shareholders' equity$10,544 $10,261 


Appendix
Page 3

Adient plc
Condensed Consolidated Statements of Cash Flows
(Unaudited)


Three Months Ended
December 31,
(in millions)20202019
Operating Activities
Net income (loss) attributable to Adient$150 $(167)
Income attributable to noncontrolling interests23 25 
Net income (loss)173 (142)
Adjustments to reconcile net income (loss) to cash provided (used) by operating activities:
Depreciation70 75 
Amortization of intangibles10 9 
Pension and postretirement contributions, net(9)(4)
Equity in earnings of partially-owned affiliates, net of dividends received(96)(102)
Impairment of nonconsolidated partially-owned affiliate— 216 
Deferred income taxes(2)(5)
Non-cash restructuring and impairment charges6 — 
Loss (gain) on divestitures - net— 25 
Equity-based compensation13 4 
Other(3)3 
Changes in assets and liabilities:
Receivables246 395 
Inventories(6)23 
Other assets(78)(2)
Restructuring reserves(53)(18)
Accounts payable and accrued liabilities(84)(267)
Accrued income taxes44 29 
Cash provided (used) by operating activities231 239 
Investing Activities
Capital expenditures(71)(91)
Sale of property, plant and equipment10 — 
Changes in long-term investments— (37)
Cash provided (used) by investing activities(61)(128)
Financing Activities
Increase (decrease) in short-term debt3 (17)
Repayment of long-term debt(18)(2)
Dividends paid to noncontrolling interests(52)(54)
Other(1)(1)
Cash provided (used) by financing activities(68)(74)
Effect of exchange rate changes on cash and cash equivalents25 4 
Increase (decrease) in cash and cash equivalents, including cash classified within current assets held for sale127 41 
Less: Change in cash classified within current assets held for sale1 — 
Increase (decrease) in cash and cash equivalents128 41 


Appendix
Page 4

Footnotes

1. Segment Results

Adient manages its business on a geographic basis and operates in the following three reportable segments for financial reporting purposes: 1) Americas, which is inclusive of North America and South America; 2) Europe, Middle East, and Africa ("EMEA") and 3) Asia Pacific/China ("Asia").

Adient evaluates the performance of its reportable segments using an adjusted EBITDA metric defined as income before income taxes and noncontrolling interests, excluding net financing charges, qualified restructuring and impairment costs, restructuring related-costs, net mark-to-market adjustments on pension and postretirement plans, transaction gains/losses, purchase accounting amortization, depreciation, stock-based compensation and other non-recurring items ("Adjusted EBITDA"). Also, certain corporate-related costs are not allocated to the segments. The reportable segments are consistent with how management views the markets served by Adient and reflect the financial information that is reviewed by its chief operating decision maker.

Financial information relating to Adient's reportable segments is as follows:

Three Months Ended
December 31,
(in millions)20202019
Net Sales
Americas$1,737 $1,859 
EMEA1,604 1,564 
Asia554 572 
Eliminations(47)(59)
Total net sales$3,848 $3,936 


Three Months Ended
December 31,
(in millions)20202019
Adjusted EBITDA
Americas$132 94 
EMEA114 49 
Asia151 177 
Corporate-related costs (1)
(19)(23)
Restructuring and impairment costs (2)
(7)(2)
Purchase accounting amortization (3)
(11)(10)
Restructuring related charges (4)
(4)(5)
Loss on business divestitures - net (5)
— (25)
Impairment of nonconsolidated partially owned affiliate - YFAI— (216)
Stock based compensation(13)(4)
Depreciation(70)(75)
Other items (9)
9 (2)
Earnings (loss) before interest and income taxes282 (42)
Net financing charges(59)(48)
Other pension income (expense)2 2 
Income (loss) before income taxes$225 $(88)

Refer to the Footnote Addendum for footnote explanations.

Appendix
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2. Earnings Per Share

The following table reconciles the numerators and denominators used to calculate basic and diluted earnings (loss) per share:

Three Months Ended
December 31,
(in millions, except per share data)20202019
Income available to shareholders
Net income (loss) attributable to Adient$150 $(167)
Weighted average shares outstanding
Basic weighted average shares outstanding94.0 93.7 
Effect of dilutive securities:
Stock options, unvested restricted stock and unvested performance share awards0.8 — 
Diluted weighted average shares outstanding94.8 93.7 

Potentially dilutive securities whose effect would have been antidilutive are excluded from the computation of diluted earnings per share, which for the three months ended December 31, 2019 is a result of being in a loss position.

Appendix
Page 6


3. Non-GAAP Measures

Adjusted EBIT, Adjusted EBIT margin, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income attributable to Adient, Adjusted effective tax rate, Adjusted earnings per share, Adjusted equity income, Adjusted interest expense, Free cash flow and Net debt as well as other measures presented on an adjusted basis are not recognized terms under U.S. GAAP and do not purport to be alternatives to the most comparable U.S. GAAP amounts. Since all companies do not use identical calculations, our definition and presentation of these measures may not be comparable to similarly titled measures reported by other companies. Management uses the identified non-GAAP measures to evaluate the operating performance of the Company and its business segments and to forecast future periods. Management believes these non-GAAP measures assist investors and other interested parties in evaluating Adient's on-going operations and provide important supplemental information to management and investors regarding financial and business trends relating to Adient's financial condition and results of operations. Investors should not consider these non-GAAP measures as alternatives to the related GAAP measures. Reconciliations of non-GAAP measures to their closest U.S. GAAP equivalent are presented below. Reconciliations of non-GAAP measures related to guidance for any future period have not been provided due to the unreasonable efforts it would take to provide such reconciliations.

•Adjusted EBIT is defined as income before income taxes and noncontrolling interests excluding net financing charges, restructuring, impairment and related costs, purchase accounting amortization, transaction gains/losses, other significant non-recurring items, and net mark-to-market adjustments on pension and postretirement plans. Adjusted EBIT margin is adjusted EBIT as a percentage of net sales.
•Adjusted EBITDA is defined as adjusted EBIT excluding depreciation and stock based compensation. Certain corporate-related costs are not allocated to the business segments in determining Adjusted EBITDA. Adjusted EBITDA margin is adjusted EBITDA as a percentage of net sales.
•Adjusted net income attributable to Adient is defined as net income attributable to Adient excluding restructuring, impairment and related costs, purchase accounting amortization, transaction gains/losses, expenses associated with becoming an independent company, other significant non-recurring items, net mark-to-market adjustments on pension and postretirement plans, the tax impact of these items and other discrete tax charges/benefits.
•Adjusted effective tax rate is defined as adjusted income tax provision as a percentage of adjusted income before income taxes.
•Adjusted earnings per share is defined as Adjusted net income attributable to Adient divided by diluted weighted average shares.
•Adjusted equity income is defined as equity income excluding amortization of Adient's intangible assets related to its non-consolidated joint ventures and other unusual or one-time items impacting equity income.
•Adjusted interest expense is defined as net financing charges excluding unusual or one-time items impacting interest expense.
•Free cash flow is defined as cash provided by operating activities less capital expenditures.
•Net debt is calculated as gross debt (short-term and long-term) less cash and cash equivalents.












Appendix
Page 7


Summarized Income Statement Information
(Refer to the Footnote Addendum for footnote explanations and details
of reconciling items between GAAP results and Adjusted results)

Three Months Ended December 31,
20202019
(in millions, except per share data)GAAP ResultsAdj.Adjusted ResultsGAAP ResultsAdj.Adjusted Results
Net sales$3,848 $— $3,848 $3,936 $— $3,936 
Cost of sales (6)
3,507 5 3,512 3,673 (2)3,671 
Gross profit341 (5)336 263 2 265 
Selling, general and administrative expenses (7)
149 (14)135 165 (10)155 
Loss on business divestitures - net (5)
— — — 25 (25)— 
Restructuring and impairment costs (2)
7 (7)— 2 (2)— 
Equity income (loss) (8)
97 (3)94 (113)221 108 
Earnings (loss) before interest and income taxes (EBIT)282 13 295 (42)260 218 
Memo accounts:
Depreciation70 75 
Equity based compensation13 4 
Adjusted EBITDA$378 $297 
Net financing charges (11)
59 1 60 48 — 48 
Other pension expense (income)(2)— (2)(2)— (2)
Income (loss) before income taxes225 12 237 (88)260 172 
Income tax provision (benefit) (12)
52 (1)51 54 2 56 
Net income (loss) attributable to Adient150 12 162 (167)257 90 
Diluted earnings (loss) per share1.58 0.13 1.71 (1.78)2.74 0.96 
Diluted weighted average shares94.8 — 94.8 93.7 0.3 94.0 


Appendix
Page 8



Segment Performance:
Three months ended December 31, 2020
AmericasEMEAAsiaCorporate/EliminationsConsolidated
Net sales$1,737 $1,604 $554 $(47)$3,848 
Adjusted EBITDA$132 $114 $151 $(19)$378 
Adjusted EBITDA margin7.6 %7.1 %27.3 %N/A9.8 %
Three months ended December 31, 2019
AmericasEMEAAsiaCorporate/EliminationsConsolidated
Net sales$1,859 $1,564 $572 $(59)$3,936 
Adjusted EBITDA$94 $49 $177 $(23)$297 
Adjusted EBITDA margin5.1 %3.1 %30.9 %N/A7.5 %


The following table reconciles income (loss) before income taxes to adjusted income before income taxes and presents the related effective tax rate and adjusted effective tax rate:

Three Months Ended December 31,
20202019
(in millions, except effective tax rate)Income (loss) before income taxesTax impactEffective tax rateIncome (loss) before income taxesTax impactEffective tax rate
As reported$225 $52 23.1%$(88)$54 (61.4)%
Adjustments12 (1)(8.3)%260 2 0.8%
As adjusted$237 $51 21.5%$172 $56 32.6%


Appendix
Page 9



The following table reconciles net income (loss) attributable to Adient to adjusted net income (loss) attributable to Adient:

Three Months Ended
December 31,
(in millions)20202019
Net income (loss) attributable to Adient$150 $(167)
Restructuring and impairment costs
7 2 
Purchase accounting amortization
11 10 
Restructuring related charges
4 5 
Loss on business divestitures - net— 25 
Impairment of nonconsolidated partially owned affiliate -YFAI— 216 
Interest accretion on long-term receivable (11)
(1)— 
Other items (9)
(9)2 
Impact of adjustments on noncontrolling interests (10)
(1)(1)
Tax impact of above adjustments and other tax items (12)
1 (2)
Adjusted net income attributable to Adient$162 $90 

Refer to the Footnote Addendum for footnote explanations


The following table reconciles diluted earnings (loss) per share as reported to adjusted diluted earnings per share:

Three Months Ended
December 31,
20202019
Diluted earnings (loss) per share as reported$1.58 $(1.78)
Restructuring and impairment costs0.07 0.02 
Purchase accounting amortization0.12 0.11 
Restructuring related charges0.04 0.05 
Loss on business divestitures - net— 0.27 
Impairment of nonconsolidated partially owned affiliate -YFAI— 2.30 
Interest accretion on long-term receivable (11)
(0.01)— 
Other items (9)
(0.09)0.02 
Impact of adjustments on noncontrolling interests (10)
(0.01)(0.01)
Tax impact of above adjustments and other tax items (12)
0.01 (0.02)
Adjusted net income attributable to Adient$1.71 $0.96 


The following table presents calculations of net debt:

December 31,September 30,
(in millions)20202020
Cash and cash equivalents$1,820 $1,692 
Total short-term and long-term debt4,361 4,307 
Net debt$2,541 $2,615 


Appendix
Page 10


The following table reconciles cash from operating activities to free cash flow:

Three Months Ended
December 31,
(in millions)20202019
Cash provided by operating activities$231 $239 
Capital expenditures(71)$(91)
Free cash flow$160 $148 


The following table reconciles adjusted EBITDA to free cash flow:

Three Months Ended
December 31,
(in millions)20202019
Adjusted EBITDA$378 $297 
(+/-) Net equity in earnings(93)(107)
(-) Restructuring (cash)(55)(20)
(+/-) Net customer tooling(8)6 
(+/-) Trade working capital (Net AR/AP + Inventory)250 202 
(+/-) Accrued compensation(19)(61)
(-) Interest paid(66)(49)
(+/-) Tax refund/taxes paid(12)(29)
(+/-) Non-income related taxes (VAT)(67)(1)
(+/-) Commercial settlements(9)19 
(+/-) Other(68)(18)
Operating cash flow231 239 
Capital expenditures(71)(91)
Free cash flow$160 $148 


Appendix
Page 11


Footnote Addendum

(1) Corporate-related costs not allocated to the segments include executive office, communications, corporate development, legal and corporate finance.

(2) Reflects qualified restructuring charges for costs that are directly attributable to restructuring activities and meet the definition of restructuring under ASC 420 along with one-time asset impairment charges, as follows:

Three Months Ended
December 31,
(in millions)20202019
Restructuring charges$(1)$(2)
Held for sale asset adjustments(6)— 
$(7)$(2)

(3) Reflects amortization of intangible assets including those related to partially owned affiliates recorded within equity income.

(4) Reflects non-qualified restructuring charges for costs that are directly attributable to restructuring activities, but do not meet the definition of restructuring under ASC 420 including restructuring costs at partially owned affiliates recorded within equity income.

(5) The adjustments to loss on business divestitures - net include:

Three Months Ended
December 31,
(in millions)20202019
Adient Aerospace deconsolidation$— $(4)
Loss on sale of RECARO business— (21)
$— $(25)

(6) The adjustments to cost of sales include:

Three Months Ended
December 31,
(in millions)20202019
Restructuring related charges$(3)$(2)
Brazil indirect tax recoveries8 — 
$5 $(2)

(7) The adjustments to selling, general and administrative costs include:

Three Months Ended
December 31,
(in millions)20202019
Purchase accounting amortization$(10)$(9)
Transaction costs(4)(1)
$(14)$(10)


Appendix
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(8) The adjustments to equity income include:

Three Months Ended
December 31,
(in millions)20202019
Impairment of nonconsolidated partially owned affiliate - YFAI$— $216 
Gain on previously held interest at YFAS in an affiliate(5)— 
Restructuring related charges1 3 
Purchase accounting amortization
1 1 
Tax adjustments at YFAI— 1 
$(3)$221 

(9) Other items include:

Three Months Ended
December 31,
(in millions)20202019
Brazil indirect tax recoveries$8 $— 
Transaction costs(4)(1)
Tax adjustments at YFAI— (1)
Gain on previously held interest at YFAS in an affiliate5 — 
$9 $(2)

(10) Reflects the impact of adjustments, primarily purchase accounting amortization on noncontrolling interests.

(11) The adjustments to net financing charges to calculate adjusted interest expense include:

Three Months Ended
December 31,
(in millions)20202019
Interest accretion on long-term receivable$1 $— 

(12) The adjustments to income tax provision (benefit) include:

Three Months Ended
December 31,
(in millions)20202019
Benefits associated with restructuring and impairment charges$— $(4)
Brazil indirect tax recoveries3 — 
Tax audit settlements— 1 
Other reconciling items(2)1 
$1 $(2)