The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Aileen Elizabeth Smith - BofA Merrill Lynch, Research Division - Analyst
: This is Aileen Smith on for John. When looking at the $100 million improvement in monthly cash burn rate, that you've been able to achieve through
the period of production stoppage, how much of this do you estimate is more structural and will translate into stronger free cash flow on the other
side of this crisis versus what is more temporary and may not persist as cost gets added back with production?
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MAY 05, 2020 / 12:30PM, ADNT.N - Q2 2020 Adient PLC Earnings Call
Question: Aileen Elizabeth Smith - BofA Merrill Lynch, Research Division - Analyst
: Great. That's helpful. And very much understood that the recent $600 million debt raise was a move to bolster near-term liquidity and withstand
the current market pressure. But over the longer term, can you remind us what you view as a sustainable or ideal capital structure, specifically any
targets longer-term around net leverage and debt paydown?
Question: Aileen Elizabeth Smith - BofA Merrill Lynch, Research Division - Analyst
: Okay. And last question, do you have any visibility around customer releases beyond the next month or 2 in Europe and North America? Particularly
anything to inform the production ramp in those regions other than the examples set in China over the past month or 2?
Question: Joseph Robert Spak - RBC Capital Markets, Research Division - Analyst
: I just want to get back, I guess, to the decremental margin discussion, which was, I think, pretty impressive in the quarter. But the mix of regions
that is, I guess, impacted in the next quarter, looks significantly different. So maybe can you just help us with that sequential bridge of what you're
expecting or maybe even an indication of what -- of how the margins held up maybe in the last 2 weeks of this past quarter?
Question: Joseph Robert Spak - RBC Capital Markets, Research Division - Analyst
: Okay. And then just looking out like, Doug, some of the comments you made, it got me thinking, like if I think about some of the issues that Adient
had over the past couple of years, I mean, a good portion of it just was, I think, complexity in sort of dealing with the launches. So look, if we take
a view that over the next couple of years, industry volume is impacted, I understand like the absolute level of EBITDA might be lower. But is there
actually a version of that where the margin improvement trajectory is actually greater because you're better able to sort of manage the flow of
volume and new launches that sort of goes through the system?
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