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FORM
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10-Q
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Adient plc
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||
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(exact name of Registrant as specified in its charter)
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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Yes
x
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No
¨
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||
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
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Yes
x
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No
¨
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||
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
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Large accelerated filer
x
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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Emerging growth company
¨
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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¨
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
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Yes
¨
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No
x
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Three Months Ended
March 31,
|
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Six Months Ended
March 31,
|
||||||||||||
(in millions, except per share data)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net sales
|
|
$
|
4,596
|
|
|
$
|
4,201
|
|
|
$
|
8,800
|
|
|
$
|
8,227
|
|
Cost of sales
|
|
4,312
|
|
|
3,822
|
|
|
8,314
|
|
|
7,498
|
|
||||
Gross profit
|
|
284
|
|
|
379
|
|
|
486
|
|
|
729
|
|
||||
Selling, general and administrative expenses
|
|
188
|
|
|
178
|
|
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384
|
|
|
395
|
|
||||
Restructuring and impairment costs
|
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315
|
|
|
6
|
|
|
315
|
|
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6
|
|
||||
Equity income
|
|
85
|
|
|
89
|
|
|
181
|
|
|
183
|
|
||||
Earnings (loss) before interest and income taxes
|
|
(134
|
)
|
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284
|
|
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(32
|
)
|
|
511
|
|
||||
Net financing charges
|
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37
|
|
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33
|
|
|
70
|
|
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68
|
|
||||
Income (loss) before income taxes
|
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(171
|
)
|
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251
|
|
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(102
|
)
|
|
443
|
|
||||
Income tax provision (benefit)
|
|
(28
|
)
|
|
37
|
|
|
237
|
|
|
65
|
|
||||
Net income (loss)
|
|
(143
|
)
|
|
214
|
|
|
(339
|
)
|
|
378
|
|
||||
Income (loss) attributable to noncontrolling interests
|
|
25
|
|
|
24
|
|
|
45
|
|
|
46
|
|
||||
Net income (loss) attributable to Adient
|
|
$
|
(168
|
)
|
|
$
|
190
|
|
|
$
|
(384
|
)
|
|
$
|
332
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share:
|
|
|
|
|
|
|
|
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||||||||
Basic
|
|
$
|
(1.80
|
)
|
|
$
|
2.03
|
|
|
$
|
(4.12
|
)
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$
|
3.54
|
|
Diluted
|
|
$
|
(1.80
|
)
|
|
$
|
2.02
|
|
|
$
|
(4.12
|
)
|
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$
|
3.53
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|
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|
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||||||||
Cash dividends declared per share
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$
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0.275
|
|
|
$
|
—
|
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$
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0.550
|
|
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$
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0.275
|
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|
|
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||||||||
Shares used in computing earnings per share:
|
|
|
|
|
|
|
|
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||||||||
Basic
|
|
93.4
|
|
|
93.7
|
|
|
93.3
|
|
|
93.7
|
|
||||
Diluted
|
|
93.4
|
|
|
94.1
|
|
|
93.3
|
|
|
94.0
|
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income (loss)
|
|
$
|
(143
|
)
|
|
$
|
214
|
|
|
$
|
(339
|
)
|
|
$
|
378
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
|
142
|
|
|
92
|
|
|
218
|
|
|
(357
|
)
|
||||
Realized and unrealized gains (losses) on derivatives
|
|
10
|
|
|
11
|
|
|
—
|
|
|
9
|
|
||||
Other comprehensive income (loss)
|
|
152
|
|
|
103
|
|
|
218
|
|
|
(348
|
)
|
||||
Total comprehensive income (loss)
|
|
9
|
|
|
317
|
|
|
(121
|
)
|
|
30
|
|
||||
Comprehensive income (loss) attributable to noncontrolling interests
|
|
35
|
|
|
28
|
|
|
60
|
|
|
48
|
|
||||
Comprehensive income (loss) attributable to Adient
|
|
$
|
(26
|
)
|
|
$
|
289
|
|
|
$
|
(181
|
)
|
|
$
|
(18
|
)
|
(in millions, except share and per share data)
|
|
March 31, 2018
|
|
September 30, 2017
|
||||
Assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
353
|
|
|
$
|
709
|
|
Accounts receivable - net
|
|
2,580
|
|
|
2,224
|
|
||
Inventories
|
|
781
|
|
|
735
|
|
||
Other current assets
|
|
882
|
|
|
831
|
|
||
Current assets
|
|
4,596
|
|
|
4,499
|
|
||
Property, plant and equipment - net
|
|
2,611
|
|
|
2,502
|
|
||
Goodwill
|
|
2,293
|
|
|
2,515
|
|
||
Other intangible assets - net
|
|
534
|
|
|
543
|
|
||
Investments in partially-owned affiliates
|
|
2,012
|
|
|
1,793
|
|
||
Other noncurrent assets
|
|
1,043
|
|
|
1,318
|
|
||
Total assets
|
|
$
|
13,089
|
|
|
$
|
13,170
|
|
Liabilities and Shareholders' Equity
|
|
|
|
|
||||
Short-term debt
|
|
$
|
173
|
|
|
$
|
36
|
|
Current portion of long-term debt
|
|
2
|
|
|
2
|
|
||
Accounts payable
|
|
3,106
|
|
|
2,958
|
|
||
Accrued compensation and benefits
|
|
365
|
|
|
444
|
|
||
Restructuring reserve
|
|
174
|
|
|
236
|
|
||
Other current liabilities
|
|
615
|
|
|
652
|
|
||
Current liabilities
|
|
4,435
|
|
|
4,328
|
|
||
Long-term debt
|
|
3,503
|
|
|
3,440
|
|
||
Pension and postretirement benefits
|
|
142
|
|
|
129
|
|
||
Other noncurrent liabilities
|
|
575
|
|
|
653
|
|
||
Long-term liabilities
|
|
4,220
|
|
|
4,222
|
|
||
Commitments and Contingencies (Note 14)
|
|
|
|
|
|
|
||
Redeemable noncontrolling interests
|
|
39
|
|
|
28
|
|
||
Preferred shares issued, par value $0.001; 100,000,000 shares authorized
Zero shares issued and outstanding at March 31, 2018 |
|
—
|
|
|
—
|
|
||
Ordinary shares issued, par value $0.001; 500,000,000 shares authorized
93,370,292 shares issued and outstanding at March 31, 2018 |
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
|
3,955
|
|
|
3,942
|
|
||
Retained earnings
|
|
299
|
|
|
734
|
|
||
Accumulated other comprehensive income (loss)
|
|
(185
|
)
|
|
(397
|
)
|
||
Shareholders' equity attributable to Adient
|
|
4,069
|
|
|
4,279
|
|
||
Noncontrolling interests
|
|
326
|
|
|
313
|
|
||
Total shareholders' equity
|
|
4,395
|
|
|
4,592
|
|
||
Total liabilities and shareholders' equity
|
|
$
|
13,089
|
|
|
$
|
13,170
|
|
|
|
Six Months Ended
March 31, |
||||||
(in millions)
|
|
2018
|
|
2017
|
||||
Operating Activities
|
|
|
|
|
||||
Net income (loss) attributable to Adient
|
|
$
|
(384
|
)
|
|
$
|
332
|
|
Income attributable to noncontrolling interests
|
|
45
|
|
|
46
|
|
||
Net income (loss)
|
|
(339
|
)
|
|
378
|
|
||
Adjustments to reconcile net income (loss) to cash provided (used) by operating activities:
|
|
|
||||||
Depreciation
|
|
197
|
|
|
164
|
|
||
Amortization of intangibles
|
|
24
|
|
|
9
|
|
||
Pension and postretirement benefit expense (benefit)
|
|
(5
|
)
|
|
2
|
|
||
Pension and postretirement contributions, net
|
|
11
|
|
|
(16
|
)
|
||
Equity in earnings of partially-owned affiliates, net of dividends received (includes purchase accounting amortization of $11 and $10, respectively)
|
|
(103
|
)
|
|
(136
|
)
|
||
Deferred income taxes
|
|
232
|
|
|
(4
|
)
|
||
Non-cash impairment charges
|
|
299
|
|
|
—
|
|
||
Equity-based compensation
|
|
30
|
|
|
22
|
|
||
Other
|
|
6
|
|
|
1
|
|
||
Changes in assets and liabilities:
|
|
|
|
|
||||
Receivables
|
|
(303
|
)
|
|
(154
|
)
|
||
Inventories
|
|
(26
|
)
|
|
4
|
|
||
Other assets
|
|
(21
|
)
|
|
(7
|
)
|
||
Restructuring reserves
|
|
(82
|
)
|
|
(72
|
)
|
||
Accounts payable and accrued liabilities
|
|
13
|
|
|
(51
|
)
|
||
Accrued income taxes
|
|
(83
|
)
|
|
3
|
|
||
Cash provided (used) by operating activities
|
|
(150
|
)
|
|
143
|
|
||
Investing Activities
|
|
|
|
|
||||
Capital expenditures
|
|
(266
|
)
|
|
(302
|
)
|
||
Sale of property, plant and equipment
|
|
2
|
|
|
17
|
|
||
Changes in long-term investments
|
|
(5
|
)
|
|
(6
|
)
|
||
Other
|
|
—
|
|
|
(2
|
)
|
||
Cash provided (used) by investing activities
|
|
(269
|
)
|
|
(293
|
)
|
||
Financing Activities
|
|
|
|
|
||||
Net transfers from (to) Parent prior to separation
|
|
—
|
|
|
606
|
|
||
Cash transferred from former Parent post separation
|
|
—
|
|
|
315
|
|
||
Increase (decrease) in short-term debt
|
|
135
|
|
|
(25
|
)
|
||
Repayment of long-term debt
|
|
(1
|
)
|
|
(100
|
)
|
||
Cash dividends
|
|
(51
|
)
|
|
—
|
|
||
Dividends paid to noncontrolling interests
|
|
(34
|
)
|
|
(17
|
)
|
||
Other
|
|
(4
|
)
|
|
3
|
|
||
Cash provided (used) by financing activities
|
|
45
|
|
|
782
|
|
||
Effect of exchange rate changes on cash and cash equivalents
|
|
18
|
|
|
(8
|
)
|
||
Increase (decrease) in cash and cash equivalents
|
|
(356
|
)
|
|
624
|
|
||
Cash and cash equivalents at beginning of period
|
|
709
|
|
|
105
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
353
|
|
|
$
|
729
|
|
1. Basis of Presentation and Summary of Significant Accounting Policies
|
(in millions)
|
|
March 31, 2018
|
|
September 30, 2017
|
||||
Current assets
|
|
$
|
253
|
|
|
$
|
232
|
|
Noncurrent assets
|
|
62
|
|
|
56
|
|
||
Total assets
|
|
$
|
315
|
|
|
$
|
288
|
|
|
|
|
|
|
||||
Current liabilities
|
|
$
|
203
|
|
|
$
|
169
|
|
Total liabilities
|
|
$
|
203
|
|
|
$
|
169
|
|
|
|
Consolidated Statements of Income (Loss)
|
||||||||||||||||||||||
|
|
Three Months Ended
March 31, 2017
|
|
Six Months Ended
March 31, 2017
|
||||||||||||||||||||
(in millions, except per share data)
|
|
As Reported
|
|
Adjustment
|
|
As Revised
|
|
As Reported
|
|
Adjustment
|
|
As Revised
|
||||||||||||
Net sales
|
|
$
|
4,212
|
|
|
$
|
(11
|
)
|
|
$
|
4,201
|
|
|
$
|
8,250
|
|
|
$
|
(23
|
)
|
|
$
|
8,227
|
|
Cost of sales
|
|
3,833
|
|
|
(11
|
)
|
|
3,822
|
|
|
7,521
|
|
|
(23
|
)
|
|
7,498
|
|
||||||
Gross profit
|
|
379
|
|
|
—
|
|
|
379
|
|
|
729
|
|
|
—
|
|
|
729
|
|
||||||
Equity income
|
|
91
|
|
|
(2
|
)
|
|
89
|
|
|
192
|
|
|
(9
|
)
|
|
183
|
|
||||||
Earnings before interest and income taxes
|
|
286
|
|
|
(2
|
)
|
|
284
|
|
|
520
|
|
|
(9
|
)
|
|
511
|
|
||||||
Income before income taxes
|
|
253
|
|
|
(2
|
)
|
|
251
|
|
|
452
|
|
|
(9
|
)
|
|
443
|
|
||||||
Net income (loss)
|
|
216
|
|
|
(2
|
)
|
|
214
|
|
|
387
|
|
|
(9
|
)
|
|
378
|
|
||||||
Net income (loss) attributable to Adient
|
|
192
|
|
|
(2
|
)
|
|
190
|
|
|
341
|
|
|
(9
|
)
|
|
332
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic
|
|
$
|
2.05
|
|
|
$
|
(0.02
|
)
|
|
$
|
2.03
|
|
|
$
|
3.64
|
|
|
$
|
(0.10
|
)
|
|
$
|
3.54
|
|
Diluted
|
|
$
|
2.04
|
|
|
$
|
(0.02
|
)
|
|
$
|
2.02
|
|
|
$
|
3.63
|
|
|
$
|
(0.10
|
)
|
|
$
|
3.53
|
|
|
|
Consolidated Statements of Comprehensive Income (Loss)
|
||||||||||||||||||||||
|
|
Three Months Ended
March 31, 2017
|
|
Six Months Ended
March 31, 2017
|
||||||||||||||||||||
(in millions)
|
|
As Reported
|
|
Adjustment
|
|
As Revised
|
|
As Reported
|
|
Adjustment
|
|
As Revised
|
||||||||||||
Total comprehensive income (loss)
|
|
$
|
319
|
|
|
$
|
(2
|
)
|
|
$
|
317
|
|
|
$
|
39
|
|
|
$
|
(9
|
)
|
|
$
|
30
|
|
Comprehensive income (loss) attributable to Adient
|
|
291
|
|
|
(2
|
)
|
|
289
|
|
|
(9
|
)
|
|
(9
|
)
|
|
(18
|
)
|
|
|
Consolidated Statements of Cash Flows
|
||||||||||
|
|
Six Months Ended
March 31, 2017
|
||||||||||
(in millions)
|
|
As Reported
|
|
Adjustment
|
|
As Revised
|
||||||
Operating Activities
|
|
|
|
|
|
|
||||||
Net income (loss)
|
|
$
|
387
|
|
|
$
|
(9
|
)
|
|
$
|
378
|
|
Equity in earnings of partially-owned affiliates, net of dividends received
|
|
(145
|
)
|
|
9
|
|
|
(136
|
)
|
|||
Cash provided (used) by operating activities
|
|
143
|
|
|
—
|
|
|
143
|
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
(in millions, except per share data)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to Adient
|
|
$
|
(168
|
)
|
|
$
|
190
|
|
|
$
|
(384
|
)
|
|
$
|
332
|
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
|
||||||||
Shares outstanding
|
|
93.4
|
|
|
93.7
|
|
|
93.3
|
|
|
93.7
|
|
||||
Effect of dilutive securities
|
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.3
|
|
||||
Diluted shares
|
|
93.4
|
|
|
94.1
|
|
|
93.3
|
|
|
94.0
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(1.80
|
)
|
|
$
|
2.03
|
|
|
$
|
(4.12
|
)
|
|
$
|
3.54
|
|
Diluted
|
|
$
|
(1.80
|
)
|
|
$
|
2.02
|
|
|
$
|
(4.12
|
)
|
|
$
|
3.53
|
|
2. Acquisitions and Divestitures
|
3. Inventories
|
(in millions)
|
|
March 31, 2018
|
|
September 30, 2017
|
||||
Raw materials and supplies
|
|
$
|
583
|
|
|
$
|
552
|
|
Work-in-process
|
|
38
|
|
|
37
|
|
||
Finished goods
|
|
160
|
|
|
146
|
|
||
Inventories
|
|
$
|
781
|
|
|
$
|
735
|
|
4. Goodwill and Other Intangible Assets
|
(in millions)
|
|
Seating
|
|
SS&M
|
|
Total
|
||||||
Balance at September 30, 2017
|
|
$
|
2,515
|
|
|
$
|
—
|
|
|
$
|
2,515
|
|
Business acquisitions
|
|
6
|
|
|
—
|
|
|
6
|
|
|||
Realignment of goodwill
|
|
(299
|
)
|
|
299
|
|
|
—
|
|
|||
Impairment
|
|
—
|
|
|
(299
|
)
|
|
(299
|
)
|
|||
Currency translation and other
|
|
71
|
|
|
—
|
|
|
71
|
|
|||
Balance at March 31, 2018
|
|
$
|
2,293
|
|
|
$
|
—
|
|
|
$
|
2,293
|
|
|
|
March 31, 2018
|
|
September 30, 2017
|
||||||||||||||||||||
(in millions)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
Intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Patented technology
|
|
$
|
31
|
|
|
$
|
(17
|
)
|
|
$
|
14
|
|
|
$
|
30
|
|
|
$
|
(15
|
)
|
|
$
|
15
|
|
Customer relationships
|
|
560
|
|
|
(87
|
)
|
|
473
|
|
|
545
|
|
|
(64
|
)
|
|
481
|
|
||||||
Trademarks
|
|
62
|
|
|
(29
|
)
|
|
33
|
|
|
59
|
|
|
(26
|
)
|
|
33
|
|
||||||
Miscellaneous
|
|
23
|
|
|
(9
|
)
|
|
14
|
|
|
22
|
|
|
(8
|
)
|
|
14
|
|
||||||
Total intangible assets
|
|
$
|
676
|
|
|
$
|
(142
|
)
|
|
$
|
534
|
|
|
$
|
656
|
|
|
$
|
(113
|
)
|
|
$
|
543
|
|
5. Product Warranties
|
|
|
Six Months Ended
March 31, |
||||||
(in millions)
|
|
2018
|
|
2017
|
||||
Balance at beginning of period
|
|
$
|
19
|
|
|
$
|
13
|
|
Accruals for warranties issued during the period
|
|
2
|
|
|
2
|
|
||
Changes in accruals related to pre-existing warranties (including changes in estimates)
|
|
(2
|
)
|
|
3
|
|
||
Settlements made (in cash or in kind) during the period
|
|
(3
|
)
|
|
(4
|
)
|
||
Balance at end of period
|
|
$
|
16
|
|
|
$
|
14
|
|
6. Debt and Financing Arrangements
|
(in millions)
|
|
March 31, 2018
|
|
September 30, 2017
|
||||
Long-term debt:
|
|
|
|
|
||||
Term Loan A - LIBOR plus 1.75% due in 2021
|
|
$
|
1,200
|
|
|
$
|
1,200
|
|
4.875% Notes due in 2026
|
|
900
|
|
|
900
|
|
||
3.50% Notes due in 2024
|
|
1,232
|
|
|
1,180
|
|
||
European Investment Bank Loan - EURIBOR plus 0.90% due in 2022
|
|
203
|
|
|
195
|
|
||
Capital lease obligations
|
|
4
|
|
|
4
|
|
||
Other
|
|
1
|
|
|
1
|
|
||
Less: debt issuance costs
|
|
(35
|
)
|
|
(38
|
)
|
||
Gross long-term debt
|
|
3,505
|
|
|
3,442
|
|
||
Less: current portion
|
|
2
|
|
|
2
|
|
||
Net long-term debt
|
|
$
|
3,503
|
|
|
$
|
3,440
|
|
|
|
|
|
|
||||
Short-term debt:
|
|
|
|
|
||||
Revolving credit facility
|
|
$
|
150
|
|
|
$
|
—
|
|
Other bank borrowings
|
|
23
|
|
|
36
|
|
||
Total short-term debt
|
|
$
|
173
|
|
|
$
|
36
|
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Interest expense, net of capitalized interest costs
|
|
$
|
36
|
|
|
$
|
32
|
|
|
$
|
70
|
|
|
$
|
65
|
|
Banking fees and debt issuance cost amortization
|
|
2
|
|
|
2
|
|
|
4
|
|
|
4
|
|
||||
Interest income
|
|
(1
|
)
|
|
—
|
|
|
(2
|
)
|
|
(1
|
)
|
||||
Net foreign exchange
|
|
—
|
|
|
(1
|
)
|
|
(2
|
)
|
|
—
|
|
||||
Net financing charges
|
|
$
|
37
|
|
|
$
|
33
|
|
|
$
|
70
|
|
|
$
|
68
|
|
7. Derivative Instruments and Hedging Activities
|
|
|
Derivatives and Hedging
Activities Designated as
Hedging Instruments
under ASC 815
|
|
Derivatives and Hedging
Activities Not Designated as
Hedging Instruments
under ASC 815
|
||||||||||||
(in millions)
|
|
March 31,
2018 |
|
September 30,
2017 |
|
March 31,
2018 |
|
September 30,
2017 |
||||||||
Other current assets
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Other noncurrent assets
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||
Equity swaps
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
||||
Cross-currency interest rate swaps
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
|
$
|
14
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other current liabilities
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
$
|
6
|
|
|
$
|
6
|
|
|
$
|
1
|
|
|
$
|
2
|
|
Other noncurrent liabilities
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
1
|
|
|
3
|
|
|
—
|
|
|
—
|
|
||||
Equity swaps
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
||||
Long-term debt
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency denominated debt
|
|
1,232
|
|
|
1,180
|
|
|
—
|
|
|
—
|
|
||||
Total liabilities
|
|
$
|
1,239
|
|
|
$
|
1,189
|
|
|
$
|
5
|
|
|
$
|
2
|
|
|
|
Assets
|
|
Liabilities
|
||||||||||||
(in millions)
|
|
March 31,
2018 |
|
September 30,
2017 |
|
March 31,
2018 |
|
September 30,
2017 |
||||||||
Gross amount recognized
|
|
$
|
14
|
|
|
$
|
8
|
|
|
$
|
1,244
|
|
|
$
|
1,191
|
|
Gross amount eligible for offsetting
|
|
(6
|
)
|
|
(2
|
)
|
|
(6
|
)
|
|
(2
|
)
|
||||
Net amount
|
|
$
|
8
|
|
|
$
|
6
|
|
|
$
|
1,238
|
|
|
$
|
1,189
|
|
(in millions)
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|||||||||
Foreign currency exchange derivatives
|
|
$
|
15
|
|
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
1
|
|
(in millions)
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||
Foreign currency exchange derivatives
|
|
Cost of sales
|
|
$
|
1
|
|
|
$
|
(7
|
)
|
|
$
|
2
|
|
|
$
|
(10
|
)
|
(in millions)
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||
Foreign currency exchange derivatives
|
|
Cost of sales
|
|
$
|
1
|
|
|
$
|
(2
|
)
|
|
$
|
(1
|
)
|
|
$
|
(16
|
)
|
Foreign currency exchange derivatives
|
|
Net financing charges
|
|
(1
|
)
|
|
4
|
|
|
(2
|
)
|
|
35
|
|
||||
Equity swap
|
|
Selling, general and administrative
|
|
(12
|
)
|
|
—
|
|
|
(15
|
)
|
|
(1
|
)
|
||||
Total
|
|
|
|
$
|
(12
|
)
|
|
$
|
2
|
|
|
$
|
(18
|
)
|
|
$
|
18
|
|
8. Fair Value Measurements
|
|
|
Fair Value Measurements Using:
|
||||||||||||||
(in millions)
|
|
Total as of
March 31,
2018
|
|
Quoted Prices
in Active
Markets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Other current assets
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
$
|
12
|
|
|
$
|
—
|
|
|
$
|
12
|
|
|
$
|
—
|
|
Other noncurrent assets
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Cross-currency interest rate swaps
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Total assets
|
|
$
|
14
|
|
|
$
|
—
|
|
|
$
|
14
|
|
|
$
|
—
|
|
Other current liabilities
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
—
|
|
Other noncurrent liabilities
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Equity swaps
|
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
||||
Total liabilities
|
|
$
|
12
|
|
|
$
|
—
|
|
|
$
|
12
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using:
|
||||||||||||||
(in millions)
|
|
Total as of
September 30,
2017
|
|
Quoted Prices
in Active
Markets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Other current assets
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
—
|
|
Other noncurrent assets
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Equity swaps
|
|
3
|
|
|
—
|
|
|
3
|
|
|
—
|
|
||||
Total assets
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
—
|
|
Other current liabilities
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
—
|
|
Other noncurrent liabilities
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange derivatives
|
|
3
|
|
|
—
|
|
|
3
|
|
|
—
|
|
||||
Total liabilities
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
—
|
|
9. Equity and Noncontrolling Interests
|
(in millions)
|
|
Ordinary Shares
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Parent's Net Investment
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Shareholders' Equity Attributable
to Adient
|
|
Shareholders' Equity Attributable to Noncontrolling Interests
|
|
Total Equity
|
||||||||||||||||
Balance at September 30, 2016
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,452
|
|
|
$
|
(276
|
)
|
|
$
|
4,176
|
|
|
$
|
131
|
|
|
$
|
4,307
|
|
Net income (loss)
|
|
—
|
|
|
—
|
|
|
267
|
|
|
65
|
|
|
—
|
|
|
332
|
|
|
34
|
|
|
366
|
|
||||||||
Change in Parent's net investment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(880
|
)
|
|
—
|
|
|
(880
|
)
|
|
—
|
|
|
(880
|
)
|
||||||||
Transfers from former Parent
|
|
—
|
|
|
332
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
332
|
|
|
—
|
|
|
332
|
|
||||||||
Reclassification of Parent's net investment and issuance of ordinary shares in connection with separation
|
|
—
|
|
|
3,637
|
|
|
—
|
|
|
(3,637
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(359
|
)
|
|
(359
|
)
|
|
2
|
|
|
(357
|
)
|
||||||||
Realized and unrealized gains (losses) on derivatives
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
9
|
|
|
—
|
|
|
9
|
|
||||||||
Repurchase and retirement of ordinary shares
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
—
|
|
|
(26
|
)
|
||||||||
Dividends attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21
|
)
|
|
(21
|
)
|
||||||||
Change in noncontrolling interest share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
5
|
|
||||||||
Share based compensation
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||||||
Balance at March 31, 2017
|
|
$
|
—
|
|
|
$
|
3,974
|
|
|
$
|
241
|
|
|
$
|
—
|
|
|
$
|
(626
|
)
|
|
$
|
3,589
|
|
|
$
|
151
|
|
|
$
|
3,740
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at September 30, 2017
|
|
$
|
—
|
|
|
$
|
3,942
|
|
|
$
|
734
|
|
|
$
|
—
|
|
|
$
|
(397
|
)
|
|
$
|
4,279
|
|
|
$
|
313
|
|
|
$
|
4,592
|
|
Net income (loss)
|
|
—
|
|
|
—
|
|
|
(384
|
)
|
|
—
|
|
|
—
|
|
|
(384
|
)
|
|
29
|
|
|
(355
|
)
|
||||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
203
|
|
|
203
|
|
|
13
|
|
|
216
|
|
||||||||
Employee retirement plans
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
9
|
|
|
—
|
|
|
9
|
|
||||||||
Dividends declared ($0.55 per share)
|
|
—
|
|
|
—
|
|
|
(51
|
)
|
|
—
|
|
|
—
|
|
|
(51
|
)
|
|
—
|
|
|
(51
|
)
|
||||||||
Dividends attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(30
|
)
|
|
(30
|
)
|
||||||||
Change in noncontrolling interest share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||||||
Share based compensation
|
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
10
|
|
||||||||
Other
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
||||||||
Balance at March 31, 2018
|
|
$
|
—
|
|
|
$
|
3,955
|
|
|
$
|
299
|
|
|
$
|
—
|
|
|
$
|
(185
|
)
|
|
$
|
4,069
|
|
|
$
|
326
|
|
|
$
|
4,395
|
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Foreign currency translation adjustments
|
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
|
$
|
(327
|
)
|
|
$
|
(707
|
)
|
|
$
|
(398
|
)
|
|
$
|
(260
|
)
|
Aggregate adjustment for the period (net of $0 tax effect for all periods)
|
|
132
|
|
|
88
|
|
|
203
|
|
|
(359
|
)
|
||||
Balance at end of period
|
|
(195
|
)
|
|
(619
|
)
|
|
(195
|
)
|
|
(619
|
)
|
||||
Realized and unrealized gains (losses) on derivatives
|
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
|
(7
|
)
|
|
(16
|
)
|
|
3
|
|
|
(14
|
)
|
||||
Current period changes in fair value (net of tax effect of $1, $2, $(1) and $1)
|
|
11
|
|
|
6
|
|
|
1
|
|
|
2
|
|
||||
Reclassification to income (net of tax effect of $0, $2, $(1) and $3)*
|
|
(1
|
)
|
|
5
|
|
|
(1
|
)
|
|
7
|
|
||||
Balance at end of period
|
|
3
|
|
|
(5
|
)
|
|
3
|
|
|
(5
|
)
|
||||
Pension and postretirement plans
|
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
|
(2
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
(2
|
)
|
||||
Net reclassifications to AOCI
|
|
9
|
|
|
—
|
|
|
9
|
|
|
—
|
|
||||
Balance at end of period
|
|
7
|
|
|
(2
|
)
|
|
7
|
|
|
(2
|
)
|
||||
Accumulated other comprehensive income (loss), end of period
|
|
$
|
(185
|
)
|
|
$
|
(626
|
)
|
|
$
|
(185
|
)
|
|
$
|
(626
|
)
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Beginning balance
|
|
$
|
29
|
|
|
$
|
38
|
|
|
$
|
28
|
|
|
$
|
34
|
|
Net income
|
|
9
|
|
|
7
|
|
|
16
|
|
|
12
|
|
||||
Foreign currency translation adjustments
|
|
1
|
|
|
1
|
|
|
2
|
|
|
—
|
|
||||
Dividends
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
||||
Change in noncontrolling interest share
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Ending balance
|
|
$
|
39
|
|
|
$
|
46
|
|
|
$
|
39
|
|
|
$
|
46
|
|
10. Restructuring and Impairment Costs
|
(in millions)
|
|
Employee Severance and Termination Benefits
|
|
Total
|
||||
Original Reserve
|
|
$
|
38
|
|
|
$
|
38
|
|
Utilized—cash
|
|
(3
|
)
|
|
(3
|
)
|
||
Balance at March 31, 2018
|
|
$
|
35
|
|
|
$
|
35
|
|
(in millions)
|
|
Employee Severance and Termination Benefits
|
|
Other
|
|
Currency
Translation |
|
Total
|
||||||||
Original Reserve
|
|
$
|
42
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
46
|
|
Utilized—cash
|
|
(4
|
)
|
|
(4
|
)
|
|
—
|
|
|
(8
|
)
|
||||
Balance at September 30, 2017
|
|
38
|
|
|
—
|
|
|
—
|
|
|
38
|
|
||||
Utilized—cash
|
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
||||
Utilized—noncash
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||
Balance at March 31, 2018
|
|
$
|
29
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
30
|
|
(in millions)
|
|
Employee Severance and Termination Benefits
|
|
Long-Lived Asset Impairments
|
|
Other
|
|
Currency
Translation |
|
Total
|
||||||||||
Original Reserve
|
|
$
|
223
|
|
|
$
|
87
|
|
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
332
|
|
Utilized—cash
|
|
(29
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(30
|
)
|
|||||
Utilized—noncash
|
|
—
|
|
|
(87
|
)
|
|
—
|
|
|
(2
|
)
|
|
(89
|
)
|
|||||
Balance at September 30, 2016
|
|
194
|
|
|
—
|
|
|
21
|
|
|
(2
|
)
|
|
213
|
|
|||||
Utilized—cash
|
|
(48
|
)
|
|
—
|
|
|
(12
|
)
|
|
—
|
|
|
(60
|
)
|
|||||
Utilized—noncash
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
|||||
Balance at September 30, 2017
|
|
146
|
|
|
—
|
|
|
9
|
|
|
5
|
|
|
160
|
|
|||||
Noncash adjustment—underspend
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|||||
Utilized—cash
|
|
(49
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(49
|
)
|
|||||
Utilized—noncash
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
4
|
|
|||||
Balance at March 31, 2018
|
|
$
|
80
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
9
|
|
|
$
|
98
|
|
11. Income Taxes
|
12. Segment Information
|
•
|
Seating: This segment produces complete seat systems for automotive and other mobility applications, as well as certain components of complete seat systems, such as foam, trim and fabric.
|
|
|
•
|
Seat Structures & Mechanisms (SS&M): This segment produces seat structures and mechanisms for inclusion in complete seat systems that are produced by Adient or others.
|
|
|
•
|
Interiors: This segment, derived from Adient's global automotive interiors joint ventures, produces instrument panels, floor consoles, door panels, overhead consoles, cockpit systems, decorative trim and other products.
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
(in millions)
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
||||||||
Net Sales
|
|
|
|
|
|
|
|
|
||||||||
Seating
|
|
$
|
4,132
|
|
|
$
|
3,825
|
|
|
$
|
7,928
|
|
|
$
|
7,517
|
|
SS&M
|
|
797
|
|
|
756
|
|
|
1,515
|
|
|
1,427
|
|
||||
Eliminations
|
|
(333
|
)
|
|
(380
|
)
|
|
(643
|
)
|
|
(717
|
)
|
||||
Total net sales
|
|
$
|
4,596
|
|
|
$
|
4,201
|
|
|
$
|
8,800
|
|
|
$
|
8,227
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
(in millions)
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
||||||||
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
||||||||
Seating
|
|
$
|
411
|
|
|
$
|
398
|
|
|
$
|
766
|
|
|
$
|
762
|
|
SS&M
|
|
(34
|
)
|
|
40
|
|
|
(116
|
)
|
|
47
|
|
||||
Interiors
|
|
12
|
|
|
22
|
|
|
37
|
|
|
52
|
|
||||
Corporate-related costs
(2)
|
|
(26
|
)
|
|
(39
|
)
|
|
(57
|
)
|
|
(70
|
)
|
||||
Becoming Adient costs
(3)
|
|
(19
|
)
|
|
(23
|
)
|
|
(38
|
)
|
|
(38
|
)
|
||||
Separation costs
(4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
||||
Restructuring and impairment costs
|
|
(315
|
)
|
|
(6
|
)
|
|
(315
|
)
|
|
(6
|
)
|
||||
Purchase accounting amortization
(5)
|
|
(18
|
)
|
|
(9
|
)
|
|
(35
|
)
|
|
(19
|
)
|
||||
Restructuring related charges
(6)
|
|
(12
|
)
|
|
(10
|
)
|
|
(23
|
)
|
|
(18
|
)
|
||||
Depreciation
(7)
|
|
(99
|
)
|
|
(78
|
)
|
|
(193
|
)
|
|
(161
|
)
|
||||
Stock based compensation
(8)
|
|
(12
|
)
|
|
(11
|
)
|
|
(22
|
)
|
|
(15
|
)
|
||||
Other items
(9)
|
|
(22
|
)
|
|
—
|
|
|
(36
|
)
|
|
(13
|
)
|
||||
Earnings before interest and income taxes
|
|
(134
|
)
|
|
284
|
|
|
(32
|
)
|
|
511
|
|
||||
Net financing charges
|
|
(37
|
)
|
|
(33
|
)
|
|
(70
|
)
|
|
(68
|
)
|
||||
Income before income taxes
|
|
$
|
(171
|
)
|
|
$
|
251
|
|
|
$
|
(102
|
)
|
|
$
|
443
|
|
(1)
|
|
Amounts presented have been revised from what was previously reported to correctly report net sales, equity income and total assets as discussed in Note 1, "Basis of Presentation and Summary of Significant Accounting Policies".
|
(2)
|
|
Corporate-related costs not allocated to the segments include executive office, communications, corporate development, legal, finance and marketing.
|
(3)
|
|
Reflects incremental expenses associated with becoming an independent company, including non-cash costs of $5 million and $11 million in the three and six months ended March 31, 2018, respectively, and non-cash costs of $6 million and $19 million in the three and six months ended March 31, 2017, respectively.
|
(4)
|
|
Reflects expenses associated with and incurred prior to the separation from the former Parent.
|
(5)
|
|
Reflects amortization of intangible assets including those related to partially owned affiliates recorded within equity income.
|
(6)
|
|
Reflects restructuring related charges for costs that are directly attributable to restructuring activities, but do not meet the definition of restructuring under ASC 420.
|
(7)
|
|
For the six months ended March 31, 2018, depreciation excludes $4 million, which is included in restructuring related charges discussed above. For the six months ended March 31, 2017, depreciation excludes $3 million which is included in Becoming Adient costs discussed above.
|
(8)
|
|
For the six months ended March 31, 2018 and 2017, stock based compensation excludes $8 million and $7 million, respectively. These amounts are included in Becoming Adient costs discussed above.
|
(9)
|
|
Reflects $8 million of out of period adjustments, $7 million of integration-related costs associated with Futuris and $7 million of non-recurring consulting fees related to SS&M for the three months ended March 31, 2018. In addition to these items, $8 million for the U.S. tax reform impact at YFAI and $6 million of integration-related costs associated with Futuris are included in the six months ended March 31, 2018. Reflects primarily $12 million of initial funding of the Adient foundation for the six months ended March 31, 2017.
|
13. Nonconsolidated Partially-Owned Affiliates
|
|
|
Six Months Ended
March 31,
|
||||||
(in millions)
|
|
2018
|
|
2017
(1)
|
||||
Net sales
|
|
$
|
9,273
|
|
|
$
|
8,503
|
|
Gross profit
|
|
$
|
1,086
|
|
|
$
|
1,092
|
|
Operating income
|
|
$
|
530
|
|
|
$
|
597
|
|
Net income
|
|
$
|
436
|
|
|
$
|
529
|
|
Net income attributable to the entity
|
|
$
|
405
|
|
|
$
|
492
|
|
(1)
|
|
Amounts presented have been revised from what was previously reported, as discussed in Note 1, "Basis of Presentation and Summary of Significant Accounting Policies". The engineering recovery revisions decreased operating income, net income and net income attributable to the entity by $18 million for the six months ended March 31, 2017.
|
14. Commitments and Contingencies
|
15. Related Party Transactions
|
(in millions)
|
|
March 31, 2018
|
|
September 30, 2017
|
||||
Accounts receivable
|
|
$
|
122
|
|
|
$
|
129
|
|
Accounts payable
|
|
132
|
|
|
104
|
|
Item 2.
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
*
|
Based on production volumes. Source: IHS Automotive
|
•
|
Adient recorded net sales of
$4,596 million
for the second quarter of fiscal 2018, representing an
increase
of
$395 million
when compared to the second quarter of fiscal 2017. Adient recorded net sales of
$8,800 million
for the first six months of fiscal 2018, representing an
increase
of
$573 million
when compared to the first six months of fiscal 2017. The increase in net sales for all periods is primarily due to the impact of the Futuris acquisition, the consolidation of a China affiliate and the favorable impact of foreign currency, partially offset by lower volumes in North America.
|
•
|
Gross profit was
$284 million
, or
6%
of net sales, for the second quarter of fiscal 2018 compared to
$379 million
, or
9%
of net sales, for the second quarter of fiscal 2017. Gross profit was
$486 million
, or
6%
of net sales, for the first six months of fiscal 2018 compared to
$729 million
, or
9%
of net sales, for the first six months of fiscal 2017. Profitability, including gross profit as a percentage of net sales, was lower primarily due to continued launch inefficiencies, premium freight, higher commodity prices, steel supply constraints and cost of customer interruptions related to SS&M along with lower volumes in North America, partially offset by the impact of the Futuris acquisition and the consolidation of a China affiliate.
|
•
|
Equity income was
$85 million
for the second quarter of fiscal 2018, which is
$4 million
lower compared to the second quarter of fiscal 2017. Equity income was
$181 million
for the first six months of fiscal 2018, which is
$2 million
lower compared to the first six months of fiscal 2017. The decreases during fiscal 2018 were primarily due to lower results from YFAI due to the first quarter impact of U.S tax reform of $8 million and lower operating margins, partially offset by higher profits at Seating affiliates.
|
•
|
Net loss attributable to Adient was
$168 million
for the second quarter of fiscal 2018, compared to
$190 million
of net income attributable to Adient for the second quarter of fiscal 2017. The net loss in the second quarter of fiscal 2018 is primarily attributable to the net-of-tax goodwill impairment charge of $279 million related to SS&M and overall lower levels of profitability as discussed above. Net loss attributable to Adient was
$384 million
for the first six months of fiscal 2018, compared to
$332 million
of net income attributable to Adient for the first six months of fiscal 2017. The net loss for the first six months of fiscal 2018 is primarily attributable to the net-of-tax goodwill impairment charge of $279 million related to SS&M, lower levels of profitability as discussed above and to a current year tax charge of $258 million related to the impact of U.S. tax reform legislation.
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
(1)
|
|
2018
|
|
Change
|
|
2017
(1)
|
||||||||
Net sales
|
|
$
|
4,596
|
|
|
9%
|
|
$
|
4,201
|
|
|
$
|
8,800
|
|
|
7%
|
|
$
|
8,227
|
|
Cost of sales
|
|
4,312
|
|
|
13%
|
|
3,822
|
|
|
8,314
|
|
|
11%
|
|
7,498
|
|
||||
Gross profit
|
|
284
|
|
|
-25%
|
|
379
|
|
|
486
|
|
|
-33%
|
|
729
|
|
||||
Selling, general and administrative expenses
|
|
188
|
|
|
6%
|
|
178
|
|
|
384
|
|
|
-3%
|
|
395
|
|
||||
Restructuring and impairment costs
|
|
315
|
|
|
*
|
|
6
|
|
|
315
|
|
|
*
|
|
6
|
|
||||
Equity income
|
|
85
|
|
|
-4%
|
|
89
|
|
|
181
|
|
|
-1%
|
|
183
|
|
||||
Earnings (loss) before interest and income taxes
|
|
(134
|
)
|
|
*
|
|
284
|
|
|
(32
|
)
|
|
*
|
|
511
|
|
||||
Net financing charges
|
|
37
|
|
|
12%
|
|
33
|
|
|
70
|
|
|
3%
|
|
68
|
|
||||
Income (loss) before income taxes
|
|
(171
|
)
|
|
*
|
|
251
|
|
|
(102
|
)
|
|
*
|
|
443
|
|
||||
Income tax provision (benefit)
|
|
(28
|
)
|
|
*
|
|
37
|
|
|
237
|
|
|
*
|
|
65
|
|
||||
Net income (loss)
|
|
(143
|
)
|
|
*
|
|
214
|
|
|
(339
|
)
|
|
*
|
|
378
|
|
||||
Income (loss) attributable to noncontrolling interests
|
|
25
|
|
|
4%
|
|
24
|
|
|
45
|
|
|
-2%
|
|
46
|
|
||||
Net income (loss) attributable to Adient
|
|
$
|
(168
|
)
|
|
*
|
|
$
|
190
|
|
|
$
|
(384
|
)
|
|
*
|
|
$
|
332
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Net sales
|
|
$
|
4,596
|
|
|
9%
|
|
$
|
4,201
|
|
|
$
|
8,800
|
|
|
7%
|
|
$
|
8,227
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||
Cost of sales
|
|
4,312
|
|
|
13%
|
|
3,822
|
|
|
8,314
|
|
|
11%
|
|
7,498
|
|
Gross profit
|
|
284
|
|
|
-25%
|
|
379
|
|
|
486
|
|
|
-33%
|
|
729
|
|
% of sales
|
|
6.2
|
%
|
|
|
|
9.0
|
%
|
|
5.5
|
%
|
|
|
|
8.9
|
%
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||
Restructuring and impairment costs
|
|
315
|
|
|
*
|
|
6
|
|
|
315
|
|
|
*
|
|
6
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Equity income
|
|
$
|
85
|
|
|
-4%
|
|
$
|
89
|
|
|
$
|
181
|
|
|
-1%
|
|
$
|
183
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Net financing charges
|
|
$
|
37
|
|
|
12%
|
|
$
|
33
|
|
|
$
|
70
|
|
|
3%
|
|
$
|
68
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Income tax provision
|
|
$
|
(28
|
)
|
|
*
|
|
$
|
37
|
|
|
$
|
237
|
|
|
*
|
|
$
|
65
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Income attributable to noncontrolling interests
|
|
$
|
25
|
|
|
4%
|
|
$
|
24
|
|
|
$
|
45
|
|
|
-2%
|
|
$
|
46
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Net income (loss) attributable to Adient
|
|
$
|
(168
|
)
|
|
*
|
|
$
|
190
|
|
|
$
|
(384
|
)
|
|
*
|
|
$
|
332
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Comprehensive income (loss) attributable to Adient
|
|
$
|
(26
|
)
|
|
*
|
|
$
|
289
|
|
|
$
|
(181
|
)
|
|
*
|
|
$
|
(18
|
)
|
|
|
|
|
|
•
|
Seating: This segment produces complete seat systems for automotive and other mobility applications, as well as certain components of complete seat systems, such as foam, trim and fabric.
|
|
|
•
|
Seat Structures & Mechanisms (SS&M): This segment produces seat structures and mechanisms for inclusion in complete seat systems that are produced by Adient or others.
|
|
|
•
|
Interiors: This segment, derived from Adient's global automotive interiors joint ventures, produces instrument panels, floor consoles, door panels, overhead consoles, cockpit systems, decorative trim and other products.
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
(1)
|
|
2018
|
|
Change
|
|
2017
(1)
|
||||||||
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Seating
|
|
$
|
4,132
|
|
|
8%
|
|
$
|
3,825
|
|
|
$
|
7,928
|
|
|
5%
|
|
$
|
7,517
|
|
SS&M
|
|
797
|
|
|
5%
|
|
756
|
|
|
1,515
|
|
|
6%
|
|
1,427
|
|
||||
Eliminations
|
|
(333
|
)
|
|
|
|
(380
|
)
|
|
(643
|
)
|
|
|
|
(717
|
)
|
||||
Total net sales
|
|
$
|
4,596
|
|
|
|
|
$
|
4,201
|
|
|
$
|
8,800
|
|
|
|
|
$
|
8,227
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
(1)
|
|
2018
|
|
Change
|
|
2017
(1)
|
||||||||
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Seating
|
|
$
|
411
|
|
|
3%
|
|
$
|
398
|
|
|
$
|
766
|
|
|
1%
|
|
$
|
762
|
|
SS&M
|
|
(34
|
)
|
|
*
|
|
40
|
|
|
(116
|
)
|
|
*
|
|
47
|
|
||||
Interiors
|
|
12
|
|
|
-45%
|
|
22
|
|
|
37
|
|
|
-29%
|
|
52
|
|
||||
Corporate-related costs
(2)
|
|
(26
|
)
|
|
|
|
(39
|
)
|
|
(57
|
)
|
|
|
|
(70
|
)
|
||||
Becoming Adient costs
(3)
|
|
(19
|
)
|
|
|
|
(23
|
)
|
|
(38
|
)
|
|
|
|
(38
|
)
|
||||
Separation costs
(4)
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
|
|
(10
|
)
|
||||
Restructuring and impairment costs
|
|
(315
|
)
|
|
|
|
(6
|
)
|
|
(315
|
)
|
|
|
|
(6
|
)
|
||||
Purchase accounting amortization
(5)
|
|
(18
|
)
|
|
|
|
(9
|
)
|
|
(35
|
)
|
|
|
|
(19
|
)
|
||||
Restructuring related charges
(6)
|
|
(12
|
)
|
|
|
|
(10
|
)
|
|
(23
|
)
|
|
|
|
(18
|
)
|
||||
Depreciation
(7)
|
|
(99
|
)
|
|
|
|
(78
|
)
|
|
(193
|
)
|
|
|
|
(161
|
)
|
||||
Stock based compensation
(8)
|
|
(12
|
)
|
|
|
|
(11
|
)
|
|
(22
|
)
|
|
|
|
(15
|
)
|
||||
Other items
(9)
|
|
(22
|
)
|
|
|
|
—
|
|
|
(36
|
)
|
|
|
|
(13
|
)
|
||||
Earnings before interest and income taxes
|
|
(134
|
)
|
|
|
|
284
|
|
|
(32
|
)
|
|
|
|
511
|
|
||||
Net financing charges
|
|
(37
|
)
|
|
|
|
(33
|
)
|
|
(70
|
)
|
|
|
|
(68
|
)
|
||||
Income before income taxes
|
|
$
|
(171
|
)
|
|
|
|
$
|
251
|
|
|
$
|
(102
|
)
|
|
|
|
$
|
443
|
|
|
|
|
|
|
(1)
|
|
Amounts presented have been revised from what was previously reported to correctly report net sales, equity income and total assets as discussed in Note 1, "Basis of Presentation and Summary of Significant Accounting Policies".
|
(2)
|
|
Corporate-related costs not allocated to the segments include executive office, communications, corporate development, legal, finance and marketing. The lower levels of corporate-related costs in fiscal 2018 compared to fiscal 2017 primarily relate to reduced discretionary spending and lower levels of incentive compensation. These lower levels of expenses are not anticipated to recur as part of the annual run rate of SG&A.
|
(3)
|
|
Reflects incremental expenses associated with becoming an independent company, including non-cash costs of $5 million and $11 million in the three and six months ended March 31, 2018, respectively, and non-cash costs of $6 million and $19 million in the three and six months ended March 31, 2017, respectively.
|
(4)
|
|
Reflects expenses associated with and incurred prior to the separation from the former Parent.
|
(5)
|
|
Reflects amortization of intangible assets including those related to partially owned affiliates recorded within equity income.
|
(6)
|
|
Reflects restructuring related charges for costs that are directly attributable to restructuring activities, but do not meet the definition of restructuring under ASC 420.
|
(7)
|
|
For the six months ended March 31, 2018, depreciation excludes $4 million, which is included in restructuring related charges discussed above. For the six months ended March 31, 2017, depreciation excludes $3 million which is included in Becoming Adient costs discussed above.
|
(8)
|
|
For the six months ended March 31, 2018 and 2017, stock based compensation excludes $8 million and $7 million, respectively. These amounts are included in Becoming Adient costs discussed above.
|
(9)
|
|
Reflects $8 million of out of period adjustments, $7 million of integration-related costs associated with Futuris and $7 million of non-recurring consulting fees related to SS&M for the three months ended March 31, 2018. In addition to these items, $8 million for the U.S. tax reform impact at YFAI and $6 million of integration-related costs associated with Futuris are included in the six months ended March 31, 2018. Reflects primarily $12 million of initial funding of the Adient foundation for the six months ended March 31, 2017.
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Net sales
|
|
$
|
4,132
|
|
|
8%
|
|
$
|
3,825
|
|
|
$
|
7,928
|
|
|
5%
|
|
$
|
7,517
|
|
Adjusted EBITDA
|
|
$
|
411
|
|
|
3%
|
|
$
|
398
|
|
|
$
|
766
|
|
|
1%
|
|
$
|
762
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Net sales
|
|
$
|
797
|
|
|
5%
|
|
$
|
756
|
|
|
$
|
1,515
|
|
|
6%
|
|
$
|
1,427
|
|
Adjusted EBITDA
|
|
(34
|
)
|
|
*
|
|
40
|
|
|
(116
|
)
|
|
*
|
|
47
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
Six Months Ended
March 31,
|
||||||||||||
(in millions)
|
|
2018
|
|
Change
|
|
2017
|
|
2018
|
|
Change
|
|
2017
|
||||
Adjusted EBITDA
|
|
12
|
|
|
-45%
|
|
22
|
|
|
37
|
|
|
-29%
|
|
52
|
|
|
|
Six Months Ended
March 31,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
||||
Cash provided (used) by operating activities
|
|
$
|
(150
|
)
|
|
$
|
143
|
|
Cash provided (used) by investing activities
|
|
(269
|
)
|
|
(293
|
)
|
||
Cash provided (used) by financing activities
|
|
45
|
|
|
782
|
|
||
Capital expenditures
|
|
(266
|
)
|
|
(302
|
)
|
(in millions)
|
|
March 31, 2018
|
|
September 30, 2017
|
||||
Current assets
|
|
$
|
4,596
|
|
|
$
|
4,499
|
|
Current liabilities
|
|
4,435
|
|
|
4,328
|
|
||
Working capital
|
|
$
|
161
|
|
|
$
|
171
|
|
|
|
Three Months Ended
December 31, 2017
|
||||||||||||||||||
(in millions)
|
|
Seating
|
|
SS&M
|
|
Interiors
|
|
Reconciling Items
(1)
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
3,796
|
|
|
$
|
718
|
|
|
$
|
—
|
|
|
$
|
(310
|
)
|
|
$
|
4,204
|
|
Adjusted EBITDA
|
|
$
|
355
|
|
|
$
|
(82
|
)
|
|
$
|
25
|
|
|
$
|
(31
|
)
|
|
n/a
|
|
|
Equity income
|
|
$
|
72
|
|
|
$
|
12
|
|
|
$
|
25
|
|
|
$
|
(13
|
)
|
|
$
|
96
|
|
Depreciation
|
|
$
|
52
|
|
|
$
|
41
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
96
|
|
Capital expenditures
|
|
$
|
72
|
|
|
$
|
71
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
143
|
|
|
|
Three Months Ended
March 31, 2018
|
||||||||||||||||||
(in millions)
|
|
Seating
|
|
SS&M
|
|
Interiors
|
|
Reconciling Items
(1)
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
4,132
|
|
|
$
|
797
|
|
|
$
|
—
|
|
|
$
|
(333
|
)
|
|
$
|
4,596
|
|
Adjusted EBITDA
|
|
$
|
411
|
|
|
$
|
(34
|
)
|
|
$
|
12
|
|
|
$
|
(26
|
)
|
|
n/a
|
|
|
Equity income
|
|
$
|
72
|
|
|
$
|
9
|
|
|
$
|
12
|
|
|
$
|
(8
|
)
|
|
$
|
85
|
|
Depreciation
|
|
$
|
53
|
|
|
$
|
45
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
101
|
|
Capital expenditures
|
|
$
|
58
|
|
|
$
|
65
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
123
|
|
|
|
Six Months Ended
March 31, 2018
|
||||||||||||||||||
(in millions)
|
|
Seating
|
|
SS&M
|
|
Interiors
|
|
Reconciling Items
(1)
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
7,928
|
|
|
$
|
1,515
|
|
|
$
|
—
|
|
|
$
|
(643
|
)
|
|
$
|
8,800
|
|
Adjusted EBITDA
|
|
$
|
766
|
|
|
$
|
(116
|
)
|
|
$
|
37
|
|
|
$
|
(57
|
)
|
|
n/a
|
|
|
Equity income
|
|
$
|
144
|
|
|
$
|
21
|
|
|
$
|
37
|
|
|
$
|
(21
|
)
|
|
$
|
181
|
|
Depreciation
|
|
$
|
105
|
|
|
$
|
86
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
197
|
|
Capital expenditures
|
|
$
|
130
|
|
|
$
|
136
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
266
|
|
|
|
Three Months Ended
December 31, 2016
|
||||||||||||||||||
(in millions)
|
|
Seating
|
|
SS&M
|
|
Interiors
|
|
Reconciling Items
(1)
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
3,692
|
|
|
$
|
671
|
|
|
$
|
—
|
|
|
$
|
(337
|
)
|
|
$
|
4,026
|
|
Adjusted EBITDA
|
|
$
|
364
|
|
|
$
|
7
|
|
|
$
|
30
|
|
|
$
|
(31
|
)
|
|
n/a
|
|
|
Equity income
|
|
$
|
60
|
|
|
$
|
9
|
|
|
$
|
30
|
|
|
$
|
(5
|
)
|
|
$
|
94
|
|
Depreciation
|
|
$
|
49
|
|
|
$
|
34
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
83
|
|
Capital expenditures
|
|
$
|
111
|
|
|
$
|
71
|
|
|
$
|
—
|
|
|
$
|
25
|
|
|
$
|
207
|
|
|
|
Three Months Ended
March 31, 2017
|
||||||||||||||||||
(in millions)
|
|
Seating
|
|
SS&M
|
|
Interiors
|
|
Reconciling Items
(1)
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
3,825
|
|
|
$
|
756
|
|
|
$
|
—
|
|
|
$
|
(380
|
)
|
|
$
|
4,201
|
|
Adjusted EBITDA
|
|
$
|
398
|
|
|
$
|
40
|
|
|
$
|
22
|
|
|
$
|
(39
|
)
|
|
n/a
|
|
|
Equity income
|
|
$
|
62
|
|
|
$
|
10
|
|
|
$
|
22
|
|
|
$
|
(5
|
)
|
|
$
|
89
|
|
Depreciation
|
|
$
|
42
|
|
|
$
|
34
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
81
|
|
Capital expenditures
|
|
$
|
40
|
|
|
$
|
53
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
95
|
|
|
|
Three Months Ended
June 30, 2017
|
||||||||||||||||||
(in millions)
|
|
Seating
|
|
SS&M
|
|
Interiors
|
|
Reconciling Items
(1)
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
3,620
|
|
|
$
|
713
|
|
|
$
|
—
|
|
|
$
|
(326
|
)
|
|
$
|
4,007
|
|
Adjusted EBITDA
|
|
$
|
413
|
|
|
$
|
31
|
|
|
$
|
19
|
|
|
$
|
(39
|
)
|
|
n/a
|
|
|
Equity income
|
|
$
|
70
|
|
|
$
|
9
|
|
|
$
|
19
|
|
|
$
|
(7
|
)
|
|
$
|
91
|
|
Depreciation
|
|
$
|
45
|
|
|
$
|
37
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
84
|
|
Capital expenditures
|
|
$
|
59
|
|
|
$
|
56
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
115
|
|
|
|
Three Months Ended
September 30, 2017
|
||||||||||||||||||
(in millions)
|
|
Seating
|
|
SS&M
|
|
Interiors
|
|
Reconciling Items
(1)
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
3,605
|
|
|
$
|
670
|
|
|
$
|
—
|
|
|
$
|
(296
|
)
|
|
$
|
3,979
|
|
Adjusted EBITDA
|
|
$
|
403
|
|
|
$
|
4
|
|
|
$
|
22
|
|
|
$
|
(39
|
)
|
|
n/a
|
|
|
Equity income
|
|
$
|
72
|
|
|
$
|
9
|
|
|
$
|
22
|
|
|
$
|
145
|
|
|
$
|
248
|
|
Depreciation
|
|
$
|
47
|
|
|
$
|
40
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
89
|
|
Capital expenditures
|
|
$
|
81
|
|
|
$
|
79
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
160
|
|
|
|
Twelve Months Ended
September 30, 2017
|
||||||||||||||||||
(in millions)
|
|
Seating
|
|
SS&M
|
|
Interiors
|
|
Reconciling Items
(1)
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
14,742
|
|
|
$
|
2,810
|
|
|
$
|
—
|
|
|
$
|
(1,339
|
)
|
|
$
|
16,213
|
|
Adjusted EBITDA
|
|
$
|
1,578
|
|
|
$
|
82
|
|
|
$
|
93
|
|
|
$
|
(148
|
)
|
|
n/a
|
|
|
Equity income
|
|
$
|
264
|
|
|
$
|
37
|
|
|
$
|
93
|
|
|
$
|
128
|
|
|
$
|
522
|
|
Depreciation
|
|
$
|
183
|
|
|
$
|
145
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
337
|
|
Capital expenditures
|
|
$
|
291
|
|
|
$
|
259
|
|
|
$
|
—
|
|
|
$
|
27
|
|
|
$
|
577
|
|
Other Information
|
|
|
|
Not applicable.
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 4.
|
Controls and Procedures
|
PART II - OTHER INFORMATION
|
Item 1.
|
Legal Proceedings
|
|
|
|
Item 1A.
|
Risk Factors
|
|
|
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Item 3.
|
Defaults Upon Senior Securities
|
|
|
|
Item 4.
|
Mine Safety Disclosures
|
|
|
|
Item 5.
|
Other Information
|
|
|
|
Item 6.
|
Exhibit Index
|
|
|
|
Exhibit No.
|
|
Exhibit Title
|
4.1
|
|
|
|
|
|
4.2
|
|
|
|
|
|
4.3
|
|
|
|
|
|
4.4
|
|
|
|
|
|
4.5
|
|
|
|
|
|
4.6
|
|
|
|
|
|
10.1
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
Adient plc
|
|
|
By:
|
/s/ R. Bruce McDonald
|
|
|
R. Bruce McDonald
|
|
|
Chairman and Chief Executive Officer
|
|
Date:
|
May 7, 2018
|
|
|
|
|
By:
|
/s/ Jeffrey M. Stafeil
|
|
|
Jeffrey M. Stafeil
|
|
|
Executive Vice President and Chief Financial Officer
|
|
Date:
|
May 7, 2018
|
|
ADIENT GLOBAL HOLDINGS LTD
|
||
|
|
|
|
|
|
|
|
|
By:
|
|
/s/ Chris E. Schmidt
|
|
|
|
Name: Chris E. Schmidt
|
|
|
|
Title: Authorized Representative
|
SIGNED AND DELIVERED
as a
DEED
|
|
||
for and on behalf of
|
|
||
|
|
|
|
ADIENT HOLDING IRELAND LIMITED
|
|
||
|
|
|
|
as a Guarantor
|
|
||
by its lawfully appointed attorney
|
|
||
|
|
|
|
|
|
|
/s/ Chris E. Schmidt
|
|
|
|
Name:
Chris E. Schmidt
|
|
|
|
Title:
Attorney
|
in the presence of:
|
|
|
|
|
|
|
|
/s/ David Knaff
|
|
|
|
Signature of witness
|
|
|
|
|
|
|
|
David Knaff
|
|
|
|
Name of witness
|
|
|
|
|
|
|
|
Attorney
|
|
|
|
Occupation of witness
|
|
|
|
|
|
|
|
833 E. Michigan, Milwaukee WI, USA
|
|
|
|
Address of witness
|
|
|
|
|
ADIENT GLOBAL HOLDINGS LUXEMBOURG
S.À R.L., as a Guarantor
|
||
|
|
|
|
|
|
|
|
|
By:
|
|
/s/ Chris E. Schmidt
|
|
|
|
Name: Chris E. Schmidt
|
|
|
|
Title: Authroized Signatory
|
|
|
|
|
|
|
|
|
|
ADIENT GLOBAL HOLDINGS S.À R.L., as a Guarantor
|
||
|
|
|
|
|
|
|
|
|
By:
|
|
/s/ Chris E. Schmidt
|
|
|
|
Name: Chris E. Schmidt
|
|
|
|
Title: Authroized Signatory
|
|
U.S. BANK NATIONAL ASSOCIATION, as Trustee
|
||
|
|
|
|
|
|
|
|
|
By:
|
|
/s/ Peter M. Brennan
|
|
|
|
Name: Peter M. Brennan
|
|
|
|
Title: Vice President
|
|
ADIENT GLOBAL HOLDINGS LTD
|
||
|
|
|
|
|
|
|
|
|
By:
|
|
/s/ Chris E. Schmidt
|
|
|
|
Name: Chris E. Schmidt
|
|
|
|
Title: Authorized Representative
|
SIGNED AND DELIVERED
as a
DEED
|
|
||
for and on behalf of
|
|
||
|
|
|
|
ADIENT HOLDING IRELAND LIMITED
|
|
||
|
|
|
|
as a Guarantor
|
|
||
by its lawfully appointed attorney
|
|
||
|
|
|
|
|
|
|
/s/ Chris E. Schmidt
|
|
|
|
Name:
Chris E. Schmidt
|
|
|
|
Title:
Attorney
|
in the presence of:
|
|
|
|
|
|
|
|
/s/ David Knaff
|
|
|
|
Signature of witness
|
|
|
|
|
|
|
|
David Knaff
|
|
|
|
Name of witness
|
|
|
|
|
|
|
|
Attorney
|
|
|
|
Occupation of witness
|
|
|
|
|
|
|
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833 E. Michigan, Milwaukee, WI, USA
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Address of witness
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ADIENT GLOBAL HOLDINGS LUXEMBOURG
S.À R.L., as a Guarantor
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By:
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/s/ Chris E. Schmidt
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Name: Chris E. Schmidt
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Title: Authroized Signatory
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ADIENT GLOBAL HOLDINGS S.À R.L., as a Guarantor
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By:
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/s/ Chris E. Schmidt
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Name: Chris E. Schmidt
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Title: Authroized Signatory
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U.S. BANK NATIONAL ASSOCIATION, as Trustee
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By:
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/s/ Peter M. Brennan
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Name: Peter M. Brennan
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Title: Vice President
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ADIENT GLOBAL HOLDINGS LTD
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By:
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/s/ Steven T. Mielke
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Name: Steven T. Mielke
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Title: Authorized Representative
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ADIENT LTD, as a Guarantor
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By:
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/s/ Steven T. Mielke
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Name: Steven T. Mielke
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Title: Authorised Signatory
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ADIENT UK GLOBAL FINANCING LTD, as a Guarantor
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By:
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/s/ Steven T. Mielke
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Name: Steven T. Mielke
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Title: Authorised Representative
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U.S. BANK NATIONAL ASSOCIATION, as Trustee
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By:
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/s/ Yvonne Siira
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Name: Yvonne Siira
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Title: Vice President
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ADIENT GLOBAL HOLDINGS LTD
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By:
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/s/ Steven T. Mielke
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Name: Steven T. Mielke
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Title: Authorized Representative
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ADIENT LTD, as a Guarantor
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By:
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/s/ Steven T. Mielke
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Name: Steven T. Mielke
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Title: Authorised Signatory
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ADIENT UK GLOBAL FINANCING LTD, as a Guarantor
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By:
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/s/ Steven T. Mielke
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Name: Steven T. Mielke
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Title: Authorised Representative
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U.S. BANK NATIONAL ASSOCIATION, as Trustee
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By:
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/s/ Yvonne Siira
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Name: Yvonne Siira
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Title: Vice President
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ADIENT GLOBAL HOLDINGS LTD
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By:
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/s/ Chris E. Schmidt
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Name: Chris E. Schmidt
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Title: Authorized Representative
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Futuris Global Holdings, LLC
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Futuris Automotive (NA) Holdings Inc.
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Futuris Automotive (NA) Intermediate Holdings Inc.
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Futuris Automotive (US) Inc.
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Futuris Automotive (DE) LLC
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Futuris Automotive (CA) LLC
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CNI Holdings, LLC
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NICA, Inc.
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CNI-Owosso, LLC
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CNI-Duluth, LLC
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CNI Plastics, LLC
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Universal Trim, Inc.
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CNI Enterprises, Inc., each as a Guarantor
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By:
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/s/ Chris E. Schmidt
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Name: Chris E. Schmidt
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Title: Authorized Person
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U.S. BANK NATIONAL ASSOCIATION, as Trustee
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By:
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/s/ Yvonne Siira
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Name: Yvonne Siira
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Title: Vice President
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ADIENT GLOBAL HOLDINGS LTD
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By:
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/s/ Chris E. Schmidt
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Name: Chris E. Schmidt
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Title: Authorized Representative
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Futuris Global Holdings, LLC
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Futuris Automotive (NA) Holdings Inc.
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Futuris Automotive (NA) Intermediate Holdings Inc.
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Futuris Automotive (US) Inc.
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Futuris Automotive (DE) LLC
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Futuris Automotive (CA) LLC
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CNI Holdings, LLC
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NICA, Inc.
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CNI-Owosso, LLC
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CNI-Duluth, LLC
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CNI Plastics, LLC
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Universal Trim, Inc.
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CNI Enterprises, Inc., each as a Guarantor
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By:
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/s/ Chris E. Schmidt
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Name: Chris E. Schmidt
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Title: Authorized Person
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U.S. BANK NATIONAL ASSOCIATION, as Trustee
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By:
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/s/ Yvonne Siira
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Name: Yvonne Siira
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Title: Vice President
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1.
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I have reviewed this quarterly report on Form 10-Q of Adient plc;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
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4.
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The Registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and
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5.
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The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize, and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
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Date:
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May 7, 2018
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By:
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/s/ R. Bruce McDonald
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R. Bruce McDonald
Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of Adient plc;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
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4.
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The Registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and
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5.
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The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize, and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
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Date:
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May 7, 2018
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By:
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/s/ Jeffrey M. Stafeil
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Jeffrey M. Stafeil
Executive Vice President and Chief Financial Officer
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Date:
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May 7, 2018
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By:
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/s/ R. Bruce McDonald
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R. Bruce McDonald
Chief Executive Officer |
Date:
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May 7, 2018
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By:
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/s/ Jeffrey M. Stafeil
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Jeffrey M. Stafeil
Executive Vice President and Chief Financial Officer |