Adient Reports Q1 Financial Results; Provides Update to FY25 Outlook

Adient (NYSE: ADNT), a global leader in automotive seating, has released its Q1 2025 financial results and provided an update to its FY25 outlook. The company reported GAAP net income and EPS diluted of $0M and $0.00, respectively, with Adjusted-EPS diluted of $0.27. Adjusted-EPS diluted was driven by significant non-recurring items or adjustments, such as restructuring charges or one-time gains/losses. Adj.-EBITDA was $196M, aligning with expectations for lower customer production in the quarter.

Adient's financial position shows gross debt of ~$2.4B and net debt of ~$1.5B, with cash and cash equivalents standing at $860M as of December 31, 2024. The company executed $25M in share repurchases, buying back approximately 1.2M shares, signaling management's confidence in cash flow generation despite headwinds. Adient's equity income post-closing is expected to decline annually by ~$155M, but net income and EPS improvement is forecast, driven by the expected significant reduction in debt and the corresponding benefit of lower financing costs.



Adient maintained the lower end of its Adj.-EBITDA guidance range due to reduced sales guidance, influenced by foreign exchange impacts and decreased customer volume in EMEA and China regions. This conservative stance reflects the challenges faced in key markets, with currency headwinds and volume challenges in EMEA and China markets being the primary drivers behind the revision of Adient's FY25 outlook. These factors impact the company's long-term growth prospects, highlighting the importance of Adient's ability to manage currency risks and adapt to market conditions to ensure consistent growth and maintain its competitive position in global markets.



Adient's strategic transformation in China, announced in March 2021, involves ending its Yanfeng Adient Seating Co., Ltd. (YFAS) joint venture and acquiring certain businesses from it. Upon the closing of the various transactions, Adient's China business is projected to have ~$4.5B in annual consolidated and unconsolidated sales, with far-reaching customer and geographic coverage through its nine major entities, three state-of-the-art technical centers, and more than 800 engineers. Pro forma Adient's global consolidated sales and Adj.-EBITDA are expected to increase annually by between $700M-$800M and between $90M-$100M, respectively, compared to the company's FY21 outlook. This increase in sales and Adj.-EBITDA is driven by the expected growth in China and the improved integration of the company's operations in the region.

In conclusion, Adient's Q1 2025 financial results and updated FY25 outlook reflect the company's ongoing operational challenges and the need to adapt to market conditions. Despite these challenges, Adient's strategic transformation in China and its focus on managing currency risks position the company for long-term growth and success in the global automotive seating market.