alsn-10q_20200630.htm
Large Accelerated Filer 0001411207 --12-31 false 2020 Q2 true true true true true true us-gaap:AccountingStandardsUpdate201802Member 0001411207 2020-01-01 2020-06-30 xbrli:shares 0001411207 2020-07-15 iso4217:USD 0001411207 2020-06-30 0001411207 2019-12-31 0001411207 alsn:VotingCommonStockMember 2020-06-30 0001411207 alsn:VotingCommonStockMember 2019-12-31 0001411207 us-gaap:NonvotingCommonStockMember 2020-06-30 0001411207 us-gaap:NonvotingCommonStockMember 2019-12-31 iso4217:USD xbrli:shares 0001411207 2020-04-01 2020-06-30 0001411207 2019-04-01 2019-06-30 0001411207 2019-01-01 2019-06-30 0001411207 2018-12-31 0001411207 2019-06-30 0001411207 alsn:VotingCommonStockMember 2019-03-31 0001411207 us-gaap:AdditionalPaidInCapitalMember 2019-03-31 0001411207 us-gaap:RetainedEarningsMember 2019-03-31 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-03-31 0001411207 2019-03-31 0001411207 us-gaap:AdditionalPaidInCapitalMember 2019-04-01 2019-06-30 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-04-01 2019-06-30 0001411207 us-gaap:RetainedEarningsMember 2019-04-01 2019-06-30 0001411207 alsn:VotingCommonStockMember 2019-06-30 0001411207 us-gaap:AdditionalPaidInCapitalMember 2019-06-30 0001411207 us-gaap:RetainedEarningsMember 2019-06-30 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-06-30 0001411207 alsn:VotingCommonStockMember 2020-03-31 0001411207 us-gaap:AdditionalPaidInCapitalMember 2020-03-31 0001411207 us-gaap:RetainedEarningsMember 2020-03-31 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-03-31 0001411207 2020-03-31 0001411207 us-gaap:AdditionalPaidInCapitalMember 2020-04-01 2020-06-30 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-04-01 2020-06-30 0001411207 us-gaap:RetainedEarningsMember 2020-04-01 2020-06-30 0001411207 us-gaap:AdditionalPaidInCapitalMember 2020-06-30 0001411207 us-gaap:RetainedEarningsMember 2020-06-30 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-06-30 0001411207 alsn:VotingCommonStockMember 2018-12-31 0001411207 us-gaap:AdditionalPaidInCapitalMember 2018-12-31 0001411207 us-gaap:RetainedEarningsMember 2018-12-31 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-12-31 0001411207 us-gaap:AdditionalPaidInCapitalMember 2019-01-01 2019-06-30 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-01-01 2019-06-30 0001411207 us-gaap:RetainedEarningsMember 2019-01-01 2019-06-30 0001411207 us-gaap:RetainedEarningsMember srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2018-12-31 0001411207 srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2018-12-31 0001411207 us-gaap:AdditionalPaidInCapitalMember 2019-12-31 0001411207 us-gaap:RetainedEarningsMember 2019-12-31 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-12-31 0001411207 us-gaap:AdditionalPaidInCapitalMember 2020-01-01 2020-06-30 0001411207 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-01-01 2020-06-30 0001411207 us-gaap:RetainedEarningsMember 2020-01-01 2020-06-30 xbrli:pure 0001411207 us-gaap:SalesRevenueNetMember srt:NorthAmericaMember us-gaap:GeographicConcentrationRiskMember 2020-01-01 2020-06-30 alsn:Customer 0001411207 us-gaap:AccountingStandardsUpdate201613Member 2020-06-30 0001411207 us-gaap:AccountingStandardsUpdate201813Member 2020-06-30 0001411207 us-gaap:AccountingStandardsUpdate201815Member 2020-06-30 0001411207 alsn:NorthAmericaOnHighwayMember 2020-04-01 2020-06-30 0001411207 alsn:NorthAmericaOnHighwayMember 2019-04-01 2019-06-30 0001411207 alsn:NorthAmericaOnHighwayMember 2020-01-01 2020-06-30 0001411207 alsn:NorthAmericaOnHighwayMember 2019-01-01 2019-06-30 0001411207 alsn:NorthAmericaOffHighwayMember 2020-04-01 2020-06-30 0001411207 alsn:NorthAmericaOffHighwayMember 2019-04-01 2019-06-30 0001411207 alsn:NorthAmericaOffHighwayMember 2020-01-01 2020-06-30 0001411207 alsn:NorthAmericaOffHighwayMember 2019-01-01 2019-06-30 0001411207 alsn:DefenseMember 2020-04-01 2020-06-30 0001411207 alsn:DefenseMember 2019-04-01 2019-06-30 0001411207 alsn:DefenseMember 2020-01-01 2020-06-30 0001411207 alsn:DefenseMember 2019-01-01 2019-06-30 0001411207 alsn:OutsideNorthAmericaOnHighwayMember 2020-04-01 2020-06-30 0001411207 alsn:OutsideNorthAmericaOnHighwayMember 2019-04-01 2019-06-30 0001411207 alsn:OutsideNorthAmericaOnHighwayMember 2020-01-01 2020-06-30 0001411207 alsn:OutsideNorthAmericaOnHighwayMember 2019-01-01 2019-06-30 0001411207 alsn:OutsideNorthAmericaOffHighwayMember 2020-04-01 2020-06-30 0001411207 alsn:OutsideNorthAmericaOffHighwayMember 2019-04-01 2019-06-30 0001411207 alsn:OutsideNorthAmericaOffHighwayMember 2020-01-01 2020-06-30 0001411207 alsn:OutsideNorthAmericaOffHighwayMember 2019-01-01 2019-06-30 0001411207 alsn:ServicePartsSupportEquipmentAndOtherMember 2020-04-01 2020-06-30 0001411207 alsn:ServicePartsSupportEquipmentAndOtherMember 2019-04-01 2019-06-30 0001411207 alsn:ServicePartsSupportEquipmentAndOtherMember 2020-01-01 2020-06-30 0001411207 alsn:ServicePartsSupportEquipmentAndOtherMember 2019-01-01 2019-06-30 0001411207 us-gaap:TradeNamesMember 2020-06-30 0001411207 alsn:IndefiniteLivedInProcessResearchAndDevelopmentMember 2020-06-30 0001411207 us-gaap:TradeNamesMember 2019-12-31 0001411207 alsn:IndefiniteLivedInProcessResearchAndDevelopmentMember 2019-12-31 0001411207 alsn:CustomerRelationshipsCommercialMember 2020-06-30 0001411207 alsn:ProprietaryTechnologyMember 2020-06-30 0001411207 alsn:CustomerRelationshipsDefenseMember 2020-06-30 0001411207 alsn:CustomerRelationshipsCommercialMember 2019-12-31 0001411207 alsn:ProprietaryTechnologyMember 2019-12-31 0001411207 alsn:CustomerRelationshipsDefenseMember 2019-12-31 0001411207 alsn:WalkerDieCastingMember 2020-01-01 2020-06-30 0001411207 us-gaap:FairValueInputsLevel3Member 2020-06-30 0001411207 us-gaap:FairValueInputsLevel3Member 2019-12-31 0001411207 us-gaap:FairValueInputsLevel1Member 2020-06-30 0001411207 us-gaap:FairValueInputsLevel1Member 2019-12-31 0001411207 us-gaap:FairValueInputsLevel2Member 2020-06-30 0001411207 us-gaap:FairValueInputsLevel2Member 2019-12-31 0001411207 us-gaap:FairValueInputsLevel1Member us-gaap:DesignatedAsHedgingInstrumentMember 2020-06-30 0001411207 us-gaap:FairValueInputsLevel1Member us-gaap:DesignatedAsHedgingInstrumentMember 2019-12-31 0001411207 us-gaap:FairValueInputsLevel2Member us-gaap:DesignatedAsHedgingInstrumentMember 2020-06-30 0001411207 us-gaap:FairValueInputsLevel2Member us-gaap:DesignatedAsHedgingInstrumentMember 2019-12-31 0001411207 us-gaap:DesignatedAsHedgingInstrumentMember 2020-06-30 0001411207 us-gaap:DesignatedAsHedgingInstrumentMember 2019-12-31 0001411207 alsn:FivePercentageSeniorNotesDue2024Member 2020-06-30 0001411207 alsn:FivePercentageSeniorNotesDue2024Member 2019-12-31 0001411207 alsn:RevolvingCreditFacilityVariableDue2024Member 2020-06-30 0001411207 alsn:RevolvingCreditFacilityVariableDue2024Member 2019-12-31 0001411207 alsn:SeniorSecuredCreditFacilityTermLoanVariableDue2026Member 2020-06-30 0001411207 alsn:SeniorSecuredCreditFacilityTermLoanVariableDue2026Member 2019-12-31 0001411207 alsn:FourPointSevenFivePercentageSeniorNotesDue2027Member 2020-06-30 0001411207 alsn:FourPointSevenFivePercentageSeniorNotesDue2027Member 2019-12-31 0001411207 alsn:FivePointEightSevenFivePercentageSeniorNotesDue2029Member 2020-06-30 0001411207 alsn:FivePointEightSevenFivePercentageSeniorNotesDue2029Member 2019-12-31 0001411207 alsn:FivePercentageSeniorNotesDue2024Member 2020-01-01 2020-06-30 0001411207 alsn:FivePercentageSeniorNotesDue2024Member 2019-01-01 2019-12-31 0001411207 alsn:RevolvingCreditFacilityVariableDue2024Member 2020-01-01 2020-06-30 0001411207 alsn:RevolvingCreditFacilityVariableDue2024Member 2019-01-01 2019-12-31 0001411207 alsn:SeniorSecuredCreditFacilityTermLoanVariableDue2026Member 2020-01-01 2020-06-30 0001411207 alsn:SeniorSecuredCreditFacilityTermLoanVariableDue2026Member 2019-01-01 2019-12-31 0001411207 alsn:FourPointSevenFivePercentageSeniorNotesDue2027Member 2020-01-01 2020-06-30 0001411207 alsn:FourPointSevenFivePercentageSeniorNotesDue2027Member 2019-01-01 2019-12-31 0001411207 alsn:FivePointEightSevenFivePercentageSeniorNotesDue2029Member 2020-01-01 2020-06-30 0001411207 alsn:FivePointEightSevenFivePercentageSeniorNotesDue2029Member 2019-01-01 2019-12-31 0001411207 alsn:NewRevolvingCreditFacilityMember 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember 2020-01-01 2020-06-30 0001411207 alsn:PriorTermLoanMember 2019-03-31 0001411207 alsn:PriorTermLoanMember 2020-01-01 2020-06-30 0001411207 alsn:PriorRevolvingCreditFacilityMember 2019-03-31 0001411207 alsn:PriorRevolvingCreditFacilityMember 2020-01-01 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember 2019-03-31 0001411207 alsn:NewSeniorSecuredCreditFacilityMember 2020-01-01 2020-06-30 0001411207 alsn:PriorSeniorSecuredCreditFacilityMember 2019-06-30 0001411207 alsn:NewSeniorSecuredCreditFacilityMember 2019-01-01 2019-06-30 0001411207 alsn:NewSeniorSecuredCreditFacilityMember 2019-03-31 0001411207 alsn:NewTermLoanMember 2019-10-01 2019-10-31 0001411207 srt:MinimumMember alsn:NewTermLoanMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-01-01 2020-06-30 0001411207 alsn:NewTermLoanMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-01-01 2020-06-30 0001411207 srt:MinimumMember alsn:NewTermLoanMember us-gaap:BaseRateMember 2020-01-01 2020-06-30 0001411207 alsn:NewTermLoanMember us-gaap:BaseRateMember 2020-01-01 2020-06-30 0001411207 alsn:NewTermLoanMember 2020-06-30 0001411207 alsn:NewTermLoanMember 2020-01-01 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember us-gaap:LetterOfCreditMember 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember alsn:VariableRateOneMember srt:MinimumMember 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember alsn:VariableRateOneMember us-gaap:BaseRateMember 2020-01-01 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember alsn:VariableRateOneMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-01-01 2020-06-30 0001411207 alsn:NewSeniorSecuredCreditFacilityMember alsn:VariableRateTwoMember srt:MaximumMember 2020-06-30 0001411207 alsn:NewSeniorSecuredCreditFacilityMember alsn:VariableRateTwoMember srt:MinimumMember 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember alsn:VariableRateTwoMember us-gaap:BaseRateMember 2020-01-01 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember alsn:VariableRateTwoMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-01-01 2020-06-30 0001411207 alsn:NewSeniorSecuredCreditFacilityMember alsn:VariableRateThreeMember srt:MaximumMember 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember alsn:VariableRateThreeMember us-gaap:BaseRateMember 2020-01-01 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember alsn:VariableRateThreeMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-01-01 2020-06-30 0001411207 alsn:NewRevolvingCreditFacilityMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-01-01 2020-06-30 0001411207 alsn:NewSeniorSecuredCreditFacilityMember 2020-06-30 0001411207 alsn:FivePointEightSevenFivePercentageSeniorNotesDue2029Member 2019-03-31 0001411207 alsn:InterestRateSwapsAMember 2020-06-30 0001411207 alsn:InterestRateSwapsBMember 2020-06-30 0001411207 alsn:InterestRateSwapCMember 2020-06-30 0001411207 alsn:InterestRateSwapsAMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-06-30 0001411207 alsn:InterestRateSwapsBMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-06-30 0001411207 alsn:InterestRateSwapCMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-06-30 0001411207 us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:InterestRateSwapMember us-gaap:OtherCurrentLiabilitiesMember 2020-06-30 0001411207 us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:InterestRateSwapMember us-gaap:OtherCurrentLiabilitiesMember 2019-12-31 0001411207 us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:InterestRateSwapMember us-gaap:OtherNoncurrentLiabilitiesMember 2020-06-30 0001411207 us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:InterestRateSwapMember us-gaap:OtherNoncurrentLiabilitiesMember 2019-12-31 0001411207 us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:InterestRateSwapMember 2020-06-30 0001411207 us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:InterestRateSwapMember 2019-12-31 0001411207 alsn:AccumulatedOtherComprehensiveIncomeDerivativesQualifyingAsHedgesMember 2020-06-30 0001411207 alsn:ExtendedTransmissionCoverageMember 2020-06-30 0001411207 alsn:ExtendedTransmissionCoverageMember 2019-06-30 0001411207 us-gaap:BuildingMember 2020-06-30 0001411207 us-gaap:LandMember 2020-06-30 0001411207 us-gaap:VehiclesMember 2020-06-30 0001411207 us-gaap:PensionPlansDefinedBenefitMember 2020-04-01 2020-06-30 0001411207 us-gaap:PensionPlansDefinedBenefitMember 2019-04-01 2019-06-30 0001411207 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2020-04-01 2020-06-30 0001411207 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2019-04-01 2019-06-30 0001411207 us-gaap:PensionPlansDefinedBenefitMember 2020-01-01 2020-06-30 0001411207 us-gaap:PensionPlansDefinedBenefitMember 2019-01-01 2019-06-30 0001411207 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2020-01-01 2020-06-30 0001411207 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2019-01-01 2019-06-30 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2019-03-31 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2019-03-31 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2019-03-31 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2019-04-01 2019-06-30 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2019-04-01 2019-06-30 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2019-04-01 2019-06-30 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2019-06-30 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2019-06-30 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2019-06-30 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2020-03-31 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2020-03-31 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2020-03-31 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2020-04-01 2020-06-30 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2020-04-01 2020-06-30 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2020-04-01 2020-06-30 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2020-06-30 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2020-06-30 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2020-06-30 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2018-12-31 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2018-12-31 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2018-12-31 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2019-01-01 2019-06-30 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2019-01-01 2019-06-30 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2019-01-01 2019-06-30 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2019-12-31 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2019-12-31 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2019-12-31 0001411207 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2020-01-01 2020-06-30 0001411207 us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember 2020-01-01 2020-06-30 0001411207 us-gaap:AccumulatedTranslationAdjustmentMember 2020-01-01 2020-06-30 0001411207 2019-01-01 2019-01-01 0001411207 us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMember 2020-04-01 2020-06-30 0001411207 us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMember 2019-04-01 2019-06-30 0001411207 us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2020-04-01 2020-06-30 0001411207 us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2019-04-01 2019-06-30 0001411207 us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMember 2020-01-01 2020-06-30 0001411207 us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMember 2019-01-01 2019-06-30 0001411207 us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2020-01-01 2020-06-30 0001411207 us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2019-01-01 2019-06-30 0001411207 2019-10-01 2019-12-31 0001411207 alsn:TwoThousandSixteenRepurchasePlanMember 2016-11-14 0001411207 alsn:TwoThousandSixteenRepurchasePlanMember 2019-05-09 0001411207 alsn:TwoThousandSixteenRepurchasePlanMember 2017-11-08 0001411207 alsn:TwoThousandSixteenRepurchasePlanMember 2018-07-30 0001411207 alsn:TwoThousandSixteenRepurchasePlanMember 2020-01-01 2020-06-30 0001411207 alsn:TwoThousandSixteenRepurchasePlanMember 2020-04-01 2020-06-30 0001411207 alsn:TwoThousandSixteenRepurchasePlanMember 2020-06-30 0001411207 srt:AffiliatedEntityMember 2019-05-07 2019-05-07 0001411207 alsn:TwoThousandSixteenRepurchasePlanMember srt:AffiliatedEntityMember 2019-05-07 2019-05-07 0001411207 alsn:AxleTechElectricVehicleSystemsDivisionMember 2020-01-01 2020-06-30 0001411207 alsn:AxleTechElectricVehicleSystemsDivisionMember us-gaap:InProcessResearchAndDevelopmentMember 2020-01-01 2020-06-30 0001411207 alsn:WalkerDieCastingMember 2019-09-08 2019-09-09

Table of Contents

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

Commission File No. 001-35456

ALLISON TRANSMISSION HOLDINGS, INC.

(Exact Name of Registrant as Specified in Its Charter)

 

 

Delaware

26-0414014

(State or Other Jurisdiction of Incorporation or

Organization)

(I.R.S. Employer

Identification Number)

One Allison Way

 

Indianapolis,

IN

46222

(Address of Principal Executive Offices)

(Zip Code)

 

(317) 242-5000

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class

 

Trading Symbol(s)

 

Name of Each Exchange

on which Registered

Common stock, $0.01 par value

 

ALSN

 

New York Stock Exchange

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.     Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).     Yes      No  

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.

 

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

 

Smaller reporting company

 

 

 

Emerging growth company

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.    

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes      No   

As of July 15, 2020, there were 113,201,844 shares of Common Stock outstanding.

 


Table of Contents

 

INDEX

 

 

 

Page

 

PART I. FINANCIAL INFORMATION

 

 

 

 

Item 1.

Financial Statements

3 - 7

 

 

 

 

Condensed Consolidated Balance Sheets

3

 

 

 

 

Condensed Consolidated Statements of Comprehensive Income

4

 

 

 

 

Condensed Consolidated Statements of Cash Flows

5

 

 

 

 

Condensed Consolidated Statements of Stockholders’ Equity

6 - 7

 

 

 

 

Notes to Condensed Consolidated Financial Statements

8 - 25

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

26 - 39

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

41

 

 

 

Item 4.

Controls and Procedures

42

 

 

 

 

PART II. OTHER INFORMATION

 

 

 

 

Item 1.

Legal Proceedings

43

 

 

 

Item 1A.

Risk Factors

43 - 44

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

44

 

 

 

Item 6.

Exhibits

45

 

 

 

 

Signatures

46

 

 

 

 

2


Table of Contents

 

 

PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

Allison Transmission Holdings, Inc.

Condensed Consolidated Balance Sheets

(unaudited, dollars in millions, except share and per share data)

 

 

 

June 30,

2020

 

 

December 31,

2019

 

ASSETS

 

 

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

434

 

 

$

192

 

Accounts receivable – net of allowances for doubtful accounts of $2 and $1, respectively

 

 

212

 

 

 

253

 

Inventories

 

 

201

 

 

 

199

 

Other current assets

 

 

40

 

 

 

42

 

Total Current Assets

 

 

887

 

 

 

686

 

Property, plant and equipment, net

 

 

634

 

 

 

616

 

Intangible assets, net

 

 

986

 

 

 

1,042

 

Goodwill

 

 

2,062

 

 

 

2,041

 

Other non-current assets

 

 

64

 

 

 

65

 

TOTAL ASSETS

 

$

4,633

 

 

$

4,450

 

LIABILITIES

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

$

138

 

 

$

150

 

Product warranty liability

 

 

29

 

 

 

24

 

Current portion of long-term debt

 

 

6

 

 

 

6

 

Deferred revenue

 

 

34

 

 

 

35

 

Other current liabilities

 

 

149

 

 

 

202

 

Total Current Liabilities

 

 

356

 

 

 

417

 

Product warranty liability

 

 

19

 

 

 

28

 

Deferred revenue

 

 

111

 

 

 

104

 

Long-term debt

 

 

2,786

 

 

 

2,512

 

Deferred income taxes

 

 

421

 

 

 

387

 

Other non-current liabilities

 

 

245

 

 

 

221

 

TOTAL LIABILITIES

 

 

3,938

 

 

 

3,669

 

Commitments and contingencies (see NOTE P)

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Common stock, $0.01 par value, 1,880,000,000 shares authorized, 113,200,028 shares issued and outstanding and 118,199,782 shares issued and outstanding, respectively

 

 

1

 

 

 

1

 

Non-voting common stock, $0.01 par value, 20,000,000 shares authorized, none issued and outstanding

 

 

 

 

 

 

Preferred stock, $0.01 par value, 100,000,000 shares authorized, none issued and outstanding

 

 

 

 

 

 

Paid in capital

 

 

1,806

 

 

 

1,802

 

Accumulated deficit

 

 

(1,027

)

 

 

(970

)

Accumulated other comprehensive loss, net of tax

 

 

(85

)

 

 

(52

)

TOTAL STOCKHOLDERS’ EQUITY

 

 

695

 

 

 

781

 

TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY

 

$

4,633

 

 

$

4,450

 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

3


Table of Contents

 

Allison Transmission Holdings, Inc.

Condensed Consolidated Statements of Comprehensive Income

(unaudited, dollars in millions, except per share data)

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Net sales

 

$

377

 

 

$

737

 

 

$

1,014

 

 

$

1,412

 

Cost of sales

 

 

212

 

 

 

348

 

 

 

523

 

 

 

664

 

Gross profit

 

 

165

 

 

 

389

 

 

 

491

 

 

 

748

 

Selling, general and administrative

 

 

69

 

 

 

93

 

 

 

144

 

 

 

177

 

Engineering — research and development

 

 

38

 

 

 

37

 

 

 

74

 

 

 

68

 

Operating income

 

 

58

 

 

 

259

 

 

 

273

 

 

 

503

 

Interest expense, net

 

 

(33

)

 

 

(33

)

 

 

(66

)

 

 

(69

)

Other income, net

 

 

5

 

 

 

3

 

 

 

4

 

 

 

6

 

Income before income taxes

 

 

30

 

 

 

229

 

 

 

211

 

 

 

440

 

Income tax expense

 

 

(7

)

 

 

(48

)

 

 

(49

)

 

 

(92

)

Net income

 

$

23

 

 

$

181

 

 

$

162

 

 

$

348

 

Basic earnings per share attributable to common stockholders

 

$

0.20

 

 

$

1.47

 

 

$

1.42

 

 

$

2.81

 

Diluted earnings per share attributable to common stockholders

 

$

0.20

 

 

$

1.46

 

 

$

1.41

 

 

$

2.78

 

Comprehensive income, net of tax

 

$

19

 

 

$

167

 

 

$

129

 

 

$

331

 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

4


Table of Contents

 

Allison Transmission Holdings, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited, dollars in millions)

 

  

 

Six Months Ended June 30,

 

 

 

2020

 

 

2019

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net income

 

$

162

 

 

$

348

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation of property, plant and equipment

 

 

46

 

 

 

37

 

Deferred income taxes

 

 

43

 

 

 

33

 

Amortization of intangible assets

 

 

29

 

 

 

43

 

Stock-based compensation

 

 

5

 

 

 

8

 

Amortization of deferred financing costs

 

 

2

 

 

 

2

 

Expenses related to long-term debt refinancing

 

 

 

 

 

5

 

Allowance for doubtful accounts

 

 

 

 

 

2

 

Other

 

 

3

 

 

 

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

39

 

 

 

(44

)

Inventories

 

 

(3

)

 

 

(16

)

Accounts payable

 

 

(33

)

 

 

23

 

Other assets and liabilities

 

 

(53

)

 

 

(8

)

Net cash provided by operating activities

 

 

240

 

 

 

433

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Business acquisitions

 

4

 

 

 

(133

)

Additions of long-lived assets

 

 

(49

)

 

 

(44

)

Net cash used for investing activities

 

 

(45

)

 

 

(177

)

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Borrowings on revolving credit facility

 

 

800

 

 

 

90

 

Payments on revolving credit facility

 

 

(525

)

 

 

(90

)

Repurchases of common stock

 

 

(180

)

 

 

(285

)

Dividend payments

 

 

(39

)

 

 

(37

)

Payments on long-term debt

 

 

(3

)

 

 

(1,148

)

Payment of acquisition-related contingent liability

 

 

(3

)

 

 

 

Taxes paid related to net share settlement of equity awards

 

 

(2

)

 

 

(4

)

Proceeds from exercise of stock options

 

 

1

 

 

 

4

 

Issuance of long-term debt

 

 

 

 

 

1,148

 

Debt financing fees

 

 

 

 

 

(12

)

Net cash provided by (used for) financing activities

 

 

49

 

 

 

(334

)

Effect of exchange rate changes on cash

 

 

(2

)

 

 

 

Net increase (decrease) in cash and cash equivalents

 

 

242

 

 

 

(78

)

Cash and cash equivalents at beginning of period

 

 

192

 

 

 

231

 

Cash and cash equivalents at end of period

 

$

434

 

 

$

153

 

Supplemental disclosures:

 

 

 

 

 

 

 

 

Interest paid

 

$

65

 

 

$

53

 

Income taxes paid

 

$

8

 

 

$

55

 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

5


Table of Contents

 

Allison Transmission Holdings, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(unaudited, dollars in millions)

 

 

 

Three months ended

 

 

 

Common Stock

 

 

Non-voting Common Stock

 

 

Preferred Stock

 

 

Paid-in Capital

 

 

Accumulated (Deficit) Income

 

 

Accumulated Other Comprehensive (Loss) Income, net of tax

 

 

Stockholders' Equity

 

Balance at March 31, 2019

 

$

1

 

 

$

 

 

$

 

 

$

1,787

 

 

$

(1,010

)

 

$

(33

)

 

$

745

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

5

 

 

 

 

 

 

 

 

 

5

 

Pension and OPEB liability adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3

)

 

 

(3

)

Available-for-sale securities and interest rate swaps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(12

)

 

 

(12

)

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

 

 

1

 

Issuance of common stock

 

 

 

 

 

 

 

 

 

 

 

4

 

 

 

 

 

 

 

 

 

4

 

Repurchase of common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(235

)

 

 

 

 

 

(235

)

Dividends on common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(18

)

 

 

 

 

 

(18

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

181

 

 

 

 

 

 

181

 

Balance at June 30, 2019

 

$

1

 

 

$

 

 

$

 

 

$

1,796

 

 

$

(1,082

)

 

$

(47

)

 

$

668

 

Balance at March 31, 2020

 

$

1

 

 

$

 

 

$

 

 

$

1,804

 

 

$

(1,031

)

 

$

(81

)

 

$

693

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

 

2

 

Pension and OPEB liability adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2

)

 

 

(2

)

Available-for-sale securities and interest rate swaps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2

)

 

 

(2

)

Dividends on common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(19

)

 

 

 

 

 

(19

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

23

 

 

 

 

 

 

23

 

Balance at June 30, 2020

 

$

1

 

 

$

 

 

$

 

 

$

1,806

 

 

$

(1,027

)

 

$

(85

)

 

$

695

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

6


Table of Contents

 

Allison Transmission Holdings, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(unaudited, dollars in millions)

 

 

 

Six months ended

 

 

 

Common Stock

 

 

Non-voting Common Stock

 

 

Preferred Stock

 

 

Paid-in Capital

 

 

Accumulated (Deficit) Income

 

 

Accumulated Other Comprehensive (Loss) Income, net of tax

 

 

Stockholders' Equity

 

Balance at December 31, 2018

 

$

1

 

 

$

 

 

$

 

 

$

1,788

 

 

$

(1,100

)

 

$

(30

)

 

$

659

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

8

 

 

 

 

 

 

 

 

 

8

 

Pension and OPEB liability adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

 

 

3

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

 

 

1

 

Available-for-sale securities and interest rate swaps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(21

)

 

 

(21

)

Repurchase of common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(285

)

 

 

 

 

 

(285

)

Dividends on common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(37

)

 

 

 

 

 

(37

)

Impact of adopting accounting standards

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(8

)

 

 

 

 

 

(8

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

348

 

 

 

 

 

 

348

 

Balance at June 30, 2019

 

$

1

 

 

$

 

 

$

 

 

$

1,796

 

 

$

(1,082

)

 

$

(47

)

 

$

668

 

Balance at December 31, 2019

 

$

1

 

 

$

 

 

$

 

 

$

1,802

 

 

$

(970

)

 

$

(52

)

 

$

781

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

5

 

 

 

 

 

 

 

 

 

5

 

Pension and OPEB liability adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(6

)

 

 

(6

)

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2

)

 

 

(2

)

Available-for-sale securities and interest rate swaps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(25

)

 

 

(25

)

Issuance of common stock

 

 

 

 

 

 

 

 

 

 

 

(1

)

 

 

 

 

 

 

 

 

(1

)

Repurchase of common stock