Adient, which has struggled with operations in the past, said Friday that it has approved a $600 million share repurchase program made possible by its “strong operational performance, transformed balance sheet and confidence in achieving its long-term plan.”
As with other automotive companies, supply chain headwinds, including inflation and car production volatility, continue to hurt Adient’s balance sheet, its executives said. Those factors accounted for a $2.2 billion revenue loss and $600 million EBITDA loss for the year.
CFO Jeff Stafeil, who is leaving Adient for a job at Tenneco Inc. at the end of the month, said Adient expects to recover two-third of its losses through improved production next year.
“The temporary operating inefficiencies, we’ve already started to see some improvements there as the supply chains have become a little better,” he said. “I would say certainly not to full level, but we’ve seen a little bit of green shoots in there, and we would expect that to continue to improve.”
The company said it made nearly $1 billion of debt paydown in the year and expects increased earnings, margin and free cash flow in fiscal year 2023.
Meanwhile, negotiations with customers on contracts and cost pass-throughs remain ongoing, Stafeil said.
“If we’re going to have that type of inflation in our type of business model, some of that is going to have to be covered by the customer,” he said. “We’ve had great progress on that …”
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