UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission File No.
(Exact Name of Registrant as Specified in Its Charter)
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(State or Other Jurisdiction of Incorporation or Organization) |
(I.R.S. Employer Identification Number) |
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(Address of Principal Executive Offices) |
(Zip Code) |
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(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
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Trading Symbol(s) |
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Name of Each Exchange on which Registered |
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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.
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).
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 |
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Accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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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
As of July 15, 2020, there were
INDEX
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Page |
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Item 1. |
3 - 7 |
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3 |
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4 |
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5 |
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6 - 7 |
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8 - 25 |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
26 - 39 |
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Item 3. |
41 |
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Item 4. |
42 |
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Item 1. |
43 |
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Item 1A. |
43 - 44 |
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Item 2. |
44 |
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Item 6. |
45 |
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46 |
2
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)
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June 30, 2020 |
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December 31, 2019 |
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ASSETS |
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Current Assets |
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Cash and cash equivalents |
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$ |
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$ |
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Accounts receivable – net of allowances for doubtful accounts of $ |
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Inventories |
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Other current assets |
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Total Current Assets |
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Property, plant and equipment, net |
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Intangible assets, net |
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Goodwill |
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Other non-current assets |
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TOTAL ASSETS |
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$ |
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$ |
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LIABILITIES |
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Current Liabilities |
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Accounts payable |
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$ |
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$ |
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Product warranty liability |
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Current portion of long-term debt |
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Deferred revenue |
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Other current liabilities |
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Total Current Liabilities |
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Product warranty liability |
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Deferred revenue |
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Long-term debt |
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Deferred income taxes |
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Other non-current liabilities |
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TOTAL LIABILITIES |
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Commitments and contingencies (see NOTE P) |
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STOCKHOLDERS’ EQUITY |
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Common stock, $ |
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Non-voting common stock, $ |
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Preferred stock, $ |
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Paid in capital |
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Accumulated deficit |
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( |
) |
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( |
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Accumulated other comprehensive loss, net of tax |
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( |
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( |
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TOTAL STOCKHOLDERS’ EQUITY |
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TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY |
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$ |
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$ |
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The accompanying notes are an integral part of the condensed consolidated financial statements.
3
Allison Transmission Holdings, Inc.
Condensed Consolidated Statements of Comprehensive Income
(unaudited, dollars in millions, except per share data)
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2020 |
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2019 |
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2020 |
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2019 |
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Net sales |
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$ |
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$ |
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$ |
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$ |
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Cost of sales |
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Gross profit |
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Selling, general and administrative |
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Engineering — research and development |
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Operating income |
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Interest expense, net |
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( |
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( |
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( |
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( |
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Other income, net |
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Income before income taxes |
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Income tax expense |
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( |
) |
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( |
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( |
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( |
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Net income |
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$ |
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$ |
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$ |
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$ |
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Basic earnings per share attributable to common stockholders |
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$ |
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$ |
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$ |
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$ |
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Diluted earnings per share attributable to common stockholders |
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$ |
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$ |
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$ |
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$ |
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Comprehensive income, net of tax |
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$ |
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$ |
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$ |
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$ |
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The accompanying notes are an integral part of the condensed consolidated financial statements.
4
Allison Transmission Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited, dollars in millions)
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Six Months Ended June 30, |
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2020 |
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2019 |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net income |
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$ |
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$ |
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Adjustments to reconcile net income to net cash provided by operating activities: |
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Depreciation of property, plant and equipment |
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Deferred income taxes |
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Amortization of intangible assets |
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Stock-based compensation |
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Amortization of deferred financing costs |
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Expenses related to long-term debt refinancing |
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Allowance for doubtful accounts |
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Other |
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Changes in assets and liabilities: |
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Accounts receivable |
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( |
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Inventories |
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( |
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( |
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Accounts payable |
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( |
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Other assets and liabilities |
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( |
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( |
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Net cash provided by operating activities |
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CASH FLOWS FROM INVESTING ACTIVITIES: |
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Business acquisitions |
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( |
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Additions of long-lived assets |
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( |
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( |
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Net cash used for investing activities |
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( |
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( |
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CASH FLOWS FROM FINANCING ACTIVITIES: |
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Borrowings on revolving credit facility |
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Payments on revolving credit facility |
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( |
) |
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( |
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Repurchases of common stock |
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( |
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( |
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Dividend payments |
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( |
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( |
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Payments on long-term debt |
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( |
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( |
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Payment of acquisition-related contingent liability |
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( |
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Taxes paid related to net share settlement of equity awards |
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( |
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( |
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Proceeds from exercise of stock options |
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Issuance of long-term debt |
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Debt financing fees |
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( |
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Net cash provided by (used for) financing activities |
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( |
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Effect of exchange rate changes on cash |
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( |
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Net increase (decrease) in cash and cash equivalents |
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( |
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Cash and cash equivalents at beginning of period |
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Cash and cash equivalents at end of period |
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$ |
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$ |
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Supplemental disclosures: |
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Interest paid |
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$ |
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$ |
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Income taxes paid |
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$ |
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$ |
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The accompanying notes are an integral part of the condensed consolidated financial statements.
5
Allison Transmission Holdings, Inc.
Condensed Consolidated Statements of Stockholders’ Equity
(unaudited, dollars in millions)
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Three months ended |
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Common Stock |
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Non-voting Common Stock |
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Preferred Stock |
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Paid-in Capital |
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Accumulated (Deficit) Income |
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Accumulated Other Comprehensive (Loss) Income, net of tax |
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Stockholders' Equity |
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Balance at March 31, 2019 |
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$ |
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$ |
— |
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$ |
— |
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$ |
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$ |
( |
) |
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$ |
( |
) |
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$ |
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Stock-based compensation |
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— |
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— |
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— |
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— |
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— |
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Pension and OPEB liability adjustment |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Available-for-sale securities and interest rate swaps |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
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Foreign currency translation adjustment |
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— |
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— |
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— |
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— |
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— |
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Issuance of common stock |
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— |
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— |
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— |
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— |
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— |
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Repurchase of common stock |
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— |
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— |
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— |
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— |
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( |
) |
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— |
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( |
) |
Dividends on common stock |
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— |
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— |
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— |
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— |
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( |
) |
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— |
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( |
) |
Net income |
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— |
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— |
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— |
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— |
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— |
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Balance at June 30, 2019 |
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$ |
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$ |
— |
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$ |
— |
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$ |
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$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Balance at March 31, 2020 |
|
$ |
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$ |
— |
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$ |
— |
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$ |
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$ |
( |
) |
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$ |
( |
) |
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$ |
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Stock-based compensation |
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— |
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— |
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— |
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— |
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— |
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Pension and OPEB liability adjustment |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Available-for-sale securities and interest rate swaps |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Dividends on common stock |
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— |
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— |
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— |
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— |
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( |
) |
|
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— |
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( |
) |
Net income |
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— |
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— |
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— |
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— |
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— |
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|
Balance at June 30, 2020 |
|
$ |
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$ |
— |
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$ |
— |
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$ |
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$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
The accompanying notes are an integral part of the condensed consolidated financial statements.
6
Allison Transmission Holdings, Inc.
Condensed Consolidated Statements of Stockholders’ Equity
(unaudited, dollars in millions)
|
|
Six months ended |
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Common Stock |
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Non-voting Common Stock |
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Preferred Stock |
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Paid-in Capital |
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Accumulated (Deficit) Income |
|
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Accumulated Other Comprehensive (Loss) Income, net of tax |
|
|
Stockholders' Equity |
|
|||||||
Balance at December 31, 2018 |
|
$ |
|
|
|
$ |
— |
|
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$ |
— |
|
|
$ |
|
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Stock-based compensation |
|
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— |
|
|
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— |
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|
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— |
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|
|
|
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|
|
— |
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|
— |
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|
Pension and OPEB liability adjustment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
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|
— |
|
|
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— |
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Foreign currency translation adjustment |
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— |
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— |
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— |
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— |
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— |
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|
Available-for-sale securities and interest rate swaps |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Repurchase of common stock |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
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|
( |
) |
Dividends on common stock |
|
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— |
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|
|
— |
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— |
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— |
|
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( |
) |
|
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— |
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( |
) |
Impact of adopting accounting standards |
|
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— |
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— |
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— |
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— |
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( |
) |
|
|
— |
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( |
) |
Net income |
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— |
|
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— |
|
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— |
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|
|
— |
|
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|
|
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|
|
— |
|
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|
|
Balance at June 30, 2019 |
|
$ |
|
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
|
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Balance at December 31, 2019 |
|
$ |
|
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
|
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Stock-based compensation |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
Pension and OPEB liability adjustment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Foreign currency translation adjustment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Available-for-sale securities and interest rate swaps |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Issuance of common stock |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Repurchase of common stock |
|
|
— |