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Dec 31, 2019
Allison Q4 2019 Earnings Report
Allison's Q4 2019 earnings decreased due to lower demand in the Global Off-Highway and Service Parts, Support Equipment & Other end markets, partially offset by higher demand in the North America On-Highway end market.
Key Takeaways
Allison Transmission reported Q4 2019 net sales of $617 million, a 5% decrease compared to the same period in 2018. Net income was $107 million, down from $147 million in 2018, and adjusted EBITDA was $216 million, compared to $261 million in the previous year. Adjusted free cash flow was $121 million, a decrease from $184 million in 2018.
Net sales decreased by 5% year-over-year, primarily due to lower demand in the Global Off-Highway and Service Parts, Support Equipment & Other end markets.
Net income decreased from $147 million to $107 million compared to the same period in 2018.
Adjusted EBITDA decreased from $261 million to $216 million year-over-year.
The company settled $62 million of share repurchases, resulting in $393 million of total share repurchases for the year.
Revenue by Segment
Forward Guidance
Allison expects 2020 net sales to be in the range of $2,375 to $2,475 million, Net Income in the range of $425 to $475 million, Adjusted EBITDA in the range of $855 to $915 million, Net Cash Provided by Operating Activities in the range of $600 to $640 million, Adjusted Free Cash Flow in the range of $430 to $480 million and cash income taxes in the range of $60 to $70 million.
Positive Outlook
- Net sales are expected to be between $2,375 and $2,475 million.
- Net income is projected to be in the range of $425 to $475 million.
- Adjusted EBITDA is anticipated to be between $855 and $915 million.
- Net cash provided by operating activities is forecasted to be in the range of $600 to $640 million.
- Adjusted free cash flow is expected to be between $430 and $480 million.
Challenges Ahead
- 2020 net sales guidance reflects lower demand in the Global On-Highway and Global Off-Highway end markets
- First quarter net sales are expected to be down from the same period in 2019.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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