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Adient's (ADNT) Q3 Loss Wider Than Expected, Sales Down Y/Y
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Adient PLC (ADNT - Free Report) reported adjusted loss per share of $2.78 in third-quarter fiscal 2020, wider than the Zacks Consensus Estimate of $2.11. The company had reported earnings of 38 cents in the year-ago quarter. This dismal performance mainly resulted from lower year-over-year revenue growth across all of the company’s segments.
During the reported quarter, Adient generated net sales of $1,626 million, down from the $4,219 million recorded in third-quarter fiscal 2019, mainly hurt by disappointing volume and mix due to production suspensions amid the coronavirus crisis. The top-line figure also missed the Zacks Consensus Estimate of $1,635 million.
Adient currently operates through three reportable segments — Americas, which includes North America and South America; Europe, Middle East, and Africa (EMEA); and Asia Pacific/China (Asia).
In the Americas, the company recorded revenues of $593 million, which slumped 70.5% year over year. The reported figure, however, beat the Zacks Consensus Estimate of $561 million. Adient reported adjusted negative EBITDA of $83 million in the fiscal third quarter, as against the profit of $69 million recorded in the prior-year period, primarily due to soft industry volumes, partially offset by decreased SG&A costs.
In EMEA, the company registered revenues of $698 million, significantly down 60.2% year over year. However, the revenue figure surpassed the Zacks Consensus Estimate of $542 million. Its quarterly negative EBITDA came in at $94 million, as against the prior-year quarter’s profit of $53 million. This downside resulted from bleak industry volumes, partially negated by lower SG&A costs.
Revenues in the Asia segment came in at $346 million in the reported quarter compared with the year-earlier quarter’s $530 million. The figure, however, beat the Zacks Consensus Estimate of $274 million. The company’s adjusted EBITDA was $71 million compared with the $110 million reported in third-quarter fiscal 2019 on lackluster industry volumes, slightly muted by an increase in seating equity income.
Financials
Adient had cash and cash equivalents of $1,032 million as of Jun 30, 2020, compared with $924 million as of Sep 30, 2019. As of the same date, long-term debt amounted to $4,147 million, up from $3,708 billion as of Sep 30, 2019. Capital expenditure declined to $73 million in the fiscal third quarter from the $98 million recorded in the prior-year quarter.
Outlook
For fourth-quarter fiscal 2020, Adient expects revenue of $3.3-$3.5 billion. Adjusted EBITDA is anticipated in the band of $180-$200 million. Moreover, it expects free cash flow in the range of $300-$400 million in the quarter.
Shares of Sonic Automotive have appreciated 33.6%, year to date, compared with the industry’s rise of 10.2%.
Shares of AutoNation have rallied 9.4%, year to date, compared with the industry’s gain of 10.2%.
Shares of LCI Industries have appreciated 14.8%, year to date, as against the industry’s decline of 5.3%.
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Adient's (ADNT) Q3 Loss Wider Than Expected, Sales Down Y/Y
Adient PLC (ADNT - Free Report) reported adjusted loss per share of $2.78 in third-quarter fiscal 2020, wider than the Zacks Consensus Estimate of $2.11. The company had reported earnings of 38 cents in the year-ago quarter. This dismal performance mainly resulted from lower year-over-year revenue growth across all of the company’s segments.
During the reported quarter, Adient generated net sales of $1,626 million, down from the $4,219 million recorded in third-quarter fiscal 2019, mainly hurt by disappointing volume and mix due to production suspensions amid the coronavirus crisis. The top-line figure also missed the Zacks Consensus Estimate of $1,635 million.
Adient PLC Price, Consensus and EPS Surprise
Adient PLC price-consensus-eps-surprise-chart | Adient PLC Quote
Segment Results
Adient currently operates through three reportable segments — Americas, which includes North America and South America; Europe, Middle East, and Africa (EMEA); and Asia Pacific/China (Asia).
In the Americas, the company recorded revenues of $593 million, which slumped 70.5% year over year. The reported figure, however, beat the Zacks Consensus Estimate of $561 million. Adient reported adjusted negative EBITDA of $83 million in the fiscal third quarter, as against the profit of $69 million recorded in the prior-year period, primarily due to soft industry volumes, partially offset by decreased SG&A costs.
In EMEA, the company registered revenues of $698 million, significantly down 60.2% year over year. However, the revenue figure surpassed the Zacks Consensus Estimate of $542 million. Its quarterly negative EBITDA came in at $94 million, as against the prior-year quarter’s profit of $53 million. This downside resulted from bleak industry volumes, partially negated by lower SG&A costs.
Revenues in the Asia segment came in at $346 million in the reported quarter compared with the year-earlier quarter’s $530 million. The figure, however, beat the Zacks Consensus Estimate of $274 million. The company’s adjusted EBITDA was $71 million compared with the $110 million reported in third-quarter fiscal 2019 on lackluster industry volumes, slightly muted by an increase in seating equity income.
Financials
Adient had cash and cash equivalents of $1,032 million as of Jun 30, 2020, compared with $924 million as of Sep 30, 2019. As of the same date, long-term debt amounted to $4,147 million, up from $3,708 billion as of Sep 30, 2019. Capital expenditure declined to $73 million in the fiscal third quarter from the $98 million recorded in the prior-year quarter.
Outlook
For fourth-quarter fiscal 2020, Adient expects revenue of $3.3-$3.5 billion. Adjusted EBITDA is anticipated in the band of $180-$200 million. Moreover, it expects free cash flow in the range of $300-$400 million in the quarter.
Zacks Rank & Stocks to Consider
Adient currently carries a Zacks Rank #4 (Sell).
Better-ranked stocks in the auto sector include Sonic Automotive Inc. (SAH - Free Report) , AutoNation (AN - Free Report) and LCI Industries (LCII - Free Report) , each sporting a Zacks Rank of 1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Sonic Automotive have appreciated 33.6%, year to date, compared with the industry’s rise of 10.2%.
Shares of AutoNation have rallied 9.4%, year to date, compared with the industry’s gain of 10.2%.
Shares of LCI Industries have appreciated 14.8%, year to date, as against the industry’s decline of 5.3%.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.3% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>