Adient books net loss in fiscal fourth quarter; launches review of most under-performing plants
Michigan-based Adient, one of the largest automotive seat suppliers worldwide, reported a fourth quarter 2018 net loss of US$ 1.35 billion which led to suspend its quarterly cash dividend.
Adient said the net loss was impacted by around US$ 1.5 billion of one-time, non-cash charges, primarily associated with asset impairments and the recording of valuation allowances against certain deferred tax assets.
Adjusted EBITDA decreased 36% to US$ 251 million while adjusted net income dropped 44% to US$ 122 million despite a year on year increase in revenue of 4.4% to US$ 4.15 billion. Adient said the Futuris acquisition combined with increased volume drove the year on year improvement.
At the conference call, CEO Doug DelGrosso, who took charge last September, announced it has launched a 100-day review of the company, including on-site visits to the most under-performing manufacturing plants, some of which are in Mexico, to identify room for improvement and opportunities to generate cash.
“I’ve got a proven track record of turning around challenged businesses, and I’m pretty confident in my ability as we set a path forward here at Adient,” the official said who earlier in his career spent two decades at Lear Corporation, Adient’s biggest rival in the auto-seating business.
Adient emerged from a spinoff of Johnson Controls back in in 2016 and since then the company has struggled to deliver profit. The company owns 13 facilities in Mexico located in the states of Chihuahua (3), Coahuila (5), State of Mexico, Tamaulipas, Puebla, Queretaro and Tlaxcala.