American Axle Profits on Pension Cuts

Updated for stock price movement.

DETROIT (TheStreet) -- Profits for auto-parts makers have been as rare as a mint Stutz-Bearcat.

But drivetrain manufacturer American Axle(AXL Quote), which narrowly averted bankruptcy last month, managed to post some black ink on Friday, largely by cutting back drastically on the amount it contributes to its workers' pension and retirement plans.

The company's bottom line showed modest net income of nearly $20 million, or 35 cents a share, up from the enormous loss it took a year ago: $441 million, or $8.54 a share. It was the first profit for American Axle in two years.

But to get the full story of where the company stands financially, one needs, of course, to strip out those "pension and postretirement benefit curtailment gains," to use the company's elegant locution, which amounted to $42.3 million, or 76 cents a share. On the opposite side of the ledger, the company took restructuring charges of $13 million, or 23 cents a share.

The company did not do the simple math itself in its third-quarter press release, but, excluding the gains and the charges, American Axle would have lost 18 cents a share, which would appear to be narrower than Wall Street's per-share bottom-line target. On average, analysts were forecasting a loss of 38 cents a share.

In Friday's early going, investors bid up the company's stock by as much as 9%, but as the broader market selloff gained momentum, Axle shares staged a dramatic reversal. By Friday afternoon, the stock price had fallen 52 cents, or 8%, to $6.07.