- Q3 2022 GAAP diluted EPS of $0.31 and adjusted diluted EPS
of $0.33, compared to Q3 2021 GAAP diluted EPS of $0.11 and
adjusted diluted EPS of $0.13.
- Q3 2022 Sales were $365 million, compared to $334 million in
Q3 2021.
- FY 2022 adjusted diluted EPS guidance revised to $1.12 to
$1.24 from the previous $1.00 to $1.24.
- FY 2022 sales guidance revised to $1.53 billion to $1.60
billion, previously $1.50 billion to $1.63 billion.
See Table C for reconciliation of GAAP and non-GAAP operating
income, net income (loss), earnings (loss) per share and operating
cash flow to free cash flow. Free cash flow is cash from operations
less capital expenditures.
Hexcel Corporation (NYSE: HXL):
Summary of Results from
Operations
Quarters Ended
Nine Months Ended
September 30,
September 30,
(In millions, except per share data)
2022
2021
% Change
2022
2021
% Change
Net Sales
$
364.7
$
333.8
9.3
%
$
1,148.3
$
964.4
19.1
%
Net sales change in constant currency
12.2
%
21.7
%
Operating Income
40.8
22.8
78.9
%
134.7
28.8
367.7
%
Net Income (loss)
26.8
9.0
197.8
%
89.3
(2.8
)
3,289.3
%
Diluted net income (loss) per common
share
$
0.31
$
0.11
181.8
%
$
1.05
$
(0.03
)
3,600.0
%
Non-GAAP measures for year-over-year
comparison (Table C)
Adjusted Operating Income
$
41.2
$
23.6
74.6
%
$
117.0
$
44.8
161.2
%
As a % of sales
11.3
%
7.1
%
10.2
%
4.6
%
Adjusted Net Income
28.4
11.0
158.2
%
75.1
9.7
674.2
%
Adjusted diluted net income per share
$
0.33
$
0.13
153.8
%
$
0.88
$
0.11
700.0
%
Hexcel Corporation (NYSE: HXL) today reported third quarter 2022
results including net sales of $365 million and adjusted diluted
EPS of $0.33 per share.
Chairman, CEO and President Nick Stanage said, "We delivered
strong operating leverage in the third quarter as we continue to
execute and manage through operational headwinds. Demand remains
robust, with strong pull in all our markets for lightweight
advanced composites, especially as interest in more sustainable
transportation increases. Our team remains flexible and focused on
meeting that demand as we overcome challenges arising from this
return to growth in the aftermath of the global pandemic.”
Mr. Stanage continued, “As we head into the fourth quarter, we
are narrowing our 2022 financial guidance ranges and raising our
EPS midpoint based on our strong execution year to date. For the
remainder of the year, we will continue our focus on maximizing
production and sales, while continuing to drive efficiency and
control costs. We anticipate a strong 2023 as supply chains
recover, our new employees gain operational experience, and our
customers further increase aircraft build rates. Our Hexcel team
remains motivated and committed to achieving operational
excellence, driving innovation and increasing shareholder
value.”
Markets
Sales in the third quarter of 2022 were $364.7 million compared
to $333.8 million in the third quarter of 2021.
Commercial Aerospace
- Commercial Aerospace sales of $209.1 million increased 25.1%
(26.5% in constant currency) for the third quarter of 2022 compared
to the third quarter of 2021 led by the Airbus A350 and A320neo
programs. The sub-category Other Commercial Aerospace, which
includes business jets and regional aircraft, increased 69.5% for
the third quarter of 2022 compared to the third quarter of 2021.
Business jets led the Other Commercial Aerospace growth,
particularly Gulfstream and Dassault platforms.
Space & Defense
- Space & Defense sales of $108.6 million decreased 1.6%
(increased 0.2% in constant currency) for the quarter compared to
the third quarter of 2021 due to the impact of foreign exchange
rates on European military and space sales.
Industrial
- Total Industrial sales of $47.0 million in the third quarter of
2022 decreased 16.4% (8.4% in constant currency) compared to the
third quarter of 2021 as a result of lower wind energy sales and
the negative impact of foreign exchange rates.
Consolidated Operations
Gross margin for the third quarter of 2022 was 22.4% compared to
19.8% in the third quarter of 2021 reflecting favorable operating
leverage from higher sales volume. As a percentage of sales,
selling, general and administrative and R&T expenses for the
third quarter of 2022 were 11.1% compared to 12.7% for the third
quarter of 2021. Adjusted operating income in the third quarter of
2022 was $41.2 million or 11.3% of sales, compared to $23.6
million, or 7.1% of sales in 2021. Other operating expense for both
the third quarter of 2022 and 2021 included restructuring costs.
The impact of exchange rates on operating income as a percent of
sales was favorable by approximately 50 basis points in the third
quarter of 2022 compared to the third quarter of 2021.
Year-to-Date 2022
Results
Sales for the first nine months of 2022 were $1,148.3 million
compared to $964.4 million for the same period in 2021.
Commercial Aerospace (57% of YTD sales)
- Commercial Aerospace sales of $655.6 million increased 39.9%
(41.1% in constant currency) for the first nine months of 2022
compared to the first nine months of 2021 on higher narrowbody and
Airbus A350 sales, partially offset by lower Boeing 787 sales. The
sub-category Other Commercial Aerospace increased 71.8% for the
first nine months of 2022 compared to the same period in 2021.
Space & Defense (30% of YTD sales)
- Space & Defense sales of $338.7 million increased 2.9%
(4.7% in constant currency) for the first nine months of 2022 as
compared to the first nine months of 2021, led by the CH-53K
program, civil rotorcraft, and Space sales, including satellites,
launchers and rocket motors.
Industrial (13% of YTD sales)
- Total Industrial sales of $154.0 million in the first nine
months of 2022 decreased 7.7% (1.0% in constant currency) compared
to the first nine months of 2021 as growth in automotive,
recreation and other industrial markets was offset by lower wind
energy sales and the negative impact of foreign exchange
rates.
Consolidated Operations
Gross margin for the first nine months of 2022 was 22.5%
compared to 18.8% in the prior year period, strengthening as higher
capacity utilization led to improved cost absorption. As a
percentage of sales, selling, general and administrative and
R&T expenses for the first nine months of 2022 were 12.3%
compared to 14.1% for the first nine months of 2021. Adjusted
operating income for the first nine months of 2022 was $117.0
million or 10.2% of sales, compared to $44.8 million, or 4.6% of
sales in 2021. Other operating income for the first nine months of
2022 included a pre-tax net gain of $19.4 million from the
previously announced sale of a facility in Dublin, California,
partially offset by restructuring costs. Other operating expenses
for the nine months ended September 30, 2021 primarily related to
severance and restructuring. The impact of exchange rates on
operating income as a percent of sales was favorable by
approximately 30 basis points in the first nine months of 2022
compared to 2021.
Cash and other
- The third quarter 2022 tax expense was $6.8 million and
included a discrete tax charge of $1.3 million resulting from the
true-up of a deferred tax item. The tax expense for the third
quarter of 2021 was $5.1 million and included a discrete tax charge
of $1.3 million primarily related to the remeasurement of the net
U.S. state deferred tax liabilities. The tax expense for the first
nine months of 2022 was $24.2 million. The tax expense for the
first nine months of 2021 was $1.6 million and included a net
discrete tax charge of $0.8 million primarily resulting from the
revaluation of U.S. and foreign deferred tax liabilities. The
underlying effective tax rate for 2022 is now expected to be 22%,
representing a decrease from the prior expectations of 23%.
- Net cash provided by operating activities in the first nine
months of 2022 was $56.4 million, compared to $64.2 million for the
first nine months of 2021. Working capital was a cash use of $115.0
million for the first nine months of 2022 and a use of $46.0
million for the comparable period in 2021. The increase in working
capital supports growing sales and the higher inventory levels are
a result of longer shipping lead times and holding a larger
inventory buffer or safety stock to compensate for the continuing
supply chain disruptions. Capital expenditures on a cash basis were
$58.3 million for the first nine months of 2022 compared to $15.0
million for the first nine months of 2021 with the increase
reflecting two previously announced ongoing construction projects;
the construction of a research and technology innovation center in
Salt Lake City, Utah and the expansion of Hexcel’s engineered core
operations in Morocco. Net cash used for investing activities for
the nine months ended September 30, 2022, included the net proceeds
of $21.2 million received from the sale of a facility in Dublin,
California. Free cash flow was ($1.9) million in the first nine
months of 2022 compared to $49.2 million in the first nine months
of 2021. Free cash flow is defined as cash generated from operating
activities less cash paid for capital expenditures. Capital
expenditures on an accrual basis were $49.1 million and $14.3
million for the first nine months of 2022 and 2021,
respectively.
- The Company did not repurchase any common stock during the
third quarter of 2022. The remaining authorization under the share
repurchase program at September 30, 2022, was $217 million.
- As announced today, the Board of Directors declared a quarterly
dividend of $0.10 per share payable to stockholders of record as of
November 4, 2022, with a payment date of November 14, 2022.
2022 Guidance
- Sales of $1.53 billion to $1.60 billion (previously $1.50
billion to $1.63 billion)
- Adjusted diluted earnings per share of $1.12 to $1.24
(previously $1.00 to $1.24)
- Free cash flow in the range of $100 million (previously greater
than $145 million)
- Accrual basis capital expenditures of approximately $75 million
(unchanged)
- Underlying effective tax rate is estimated to be 22%
(previously 23%)
Hexcel will host a conference call at 10:00 a.m. ET, on October
25, 2022 to discuss third quarter 2022 results. The event will be
webcast via the Investor Relations webpage at www.Hexcel.com. The
event can also be accessed by dialing +1 (646) 960-0452. The
conference ID is 3428143. Replays of the call will be available on
the website.
About Hexcel
Hexcel Corporation is a global leader in advanced lightweight
composites technology. We propel the future of flight, energy
generation, transportation, and recreation through excellence in
providing innovative high-performance material solutions that are
lighter, stronger and tougher, helping to create a better world for
us all. Our broad and unrivaled product range includes carbon
fiber, specialty reinforcements, prepregs and other
fiber-reinforced matrix materials, honeycomb, resins, engineered
core and composite structures for use in commercial aerospace,
space and defense, and industrial applications.
Disclaimer on Forward Looking Statements
This news release contains statements that are forward looking
within the meaning of the Private Securities Litigation Reform Act
of 1995, including statements relating to the estimates and
expectations based on aircraft production rates provided by Airbus,
Boeing and others; the revenues we may generate from an aircraft
model or program; the impact of the push-out in deliveries of the
Airbus and Boeing backlog and the impact of delays in the startup
or ramp-up of new aircraft programs or the final Hexcel composite
material content once the design and material selection have been
completed; expectations with regard to regulatory clearances or the
build rate of the Boeing 737 MAX or Boeing 787 and the related
impact on our revenues; expectations with regard to raw material
cost and availability; expectations of composite content on new
commercial aircraft programs and our share of those requirements;
expectations regarding revenues from space and defense
applications, including whether certain programs might be curtailed
or discontinued; expectations regarding sales for wind energy,
recreation, automotive and other industrial applications;
expectations regarding working capital trends and expenditures and
inventory levels; expectations as to the level of capital
expenditures and completion of capacity expansions and
qualification of new products; expectations regarding our ability
to improve and maintain margins; projections regarding our tax
rate; expectations with regard to the continued impact of the
COVID-19 pandemic and the impact of the conflict between Russia and
Ukraine on worldwide air travel and aircraft programs, as well as
on our customers and suppliers and, in turn, on our operations and
financial results; expectations regarding our strategic initiatives
and other goals, including, but not limited to, our sustainability
goals; and the anticipated impact of the above factors and various
market risks on our expectations of financial results for 2022 and
beyond. Actual results may differ materially from the results
anticipated in the forward looking statements due to a variety of
factors, including but not limited to the impact of the COVID-19
pandemic, including continued disruption in global financial
markets and supply chains, ongoing restrictions on movement and
travel, employee absenteeism and labor shortages, and reduced
demand for air travel, on the operations, business and financial
condition of Hexcel and its customers and suppliers; reductions in
sales to any significant customers, particularly Airbus or Boeing,
including related to the timing of pending regulatory clearances
for the Boeing 737 MAX and the Boeing 787, as well as due to the
impact of the COVID-19 pandemic; inability to effectively adjust
production and inventory levels to align with customer demand;
inability to effectively motivate, retain and hire the necessary
workforce; our ability to successfully implement or realize our
business strategies, plans, goals and objectives of management,
including our sustainability goals and any restructuring or
alignment activities in which we may engage; the impact of any
government mandated COVID-19 precautions, including mandatory
vaccination; changes in sales mix; changes in current pricing and
cost levels, including cost inflation, as well as increasing energy
prices resulting from the conflict between Russia and Ukraine;
changes in aerospace delivery rates; changes in government defense
procurement budgets; changes in military aerospace program
technology; timely new product development or introduction;
industry capacity; increased competition; availability and cost of
raw materials, including the impact of supply shortages and
inflation; supply chain disruptions, which may be exacerbated by
the conflict between Russia and Ukraine; inability to install,
staff and qualify necessary capacity or complete capacity
expansions to meet customer demand; cybersecurity-related risks
including the potential impact of breaches or intrusions; currency
exchange rate fluctuations; changes in political, social and
economic conditions, including, but not limited to, the effect of
change in global trade policies, such as sanctions imposed as a
result of the conflict between Russia and Ukraine; work stoppages
or other labor disruptions; our ability to successfully complete
any strategic acquisitions, investments or dispositions; compliance
with environmental, health, safety and other related laws and
regulations, including those related to climate change; the effects
of natural disasters, which may be worsened by the impact of
climate change, and other severe catastrophic events; the potential
impact of environmental, social and governance matters; and the
unexpected outcome of legal matters or impact of changes in laws or
regulations. Additional risk factors are described in our filings
with the Securities and Exchange Commission. We do not undertake an
obligation to update our forward-looking statements to reflect
future events.
Hexcel Corporation and
Subsidiaries
Condensed Consolidated Statements of
Operations
Unaudited
Quarters Ended
Nine Months Ended
September 30,
September 30,
(In millions, except per share data)
2022
2021
2022
2021
Net sales
$
364.7
$
333.8
$
1,148.3
$
964.4
Cost of sales
282.9
267.8
890.3
783.4
Gross margin
81.8
66.0
258.0
181.0
% Gross Margin
22.4
%
19.8
%
22.5
%
18.8
%
Selling, general and administrative
expenses
29.0
32.0
107.2
102.7
Research and technology expenses
11.6
10.4
33.8
33.5
Other operating expense (income)
0.4
0.8
(17.7
)
16.0
Operating income
40.8
22.8
134.7
28.8
Interest expense, net
9.0
9.5
27.0
29.1
Other income
-
-
(0.3
)
-
Income (loss) before income taxes, and
equity in earnings of affiliated companies
31.8
13.3
108.0
(0.3
)
Income tax expense
6.8
5.1
24.2
1.6
Income (loss) before equity in earnings of
affiliated companies
25.0
8.2
83.8
(1.9
)
Equity in earnings (losses) from
affiliated companies
1.8
0.8
5.5
(0.9
)
Net income (loss)
$
26.8
$
9.0
$
89.3
$
(2.8
)
Basic net income (loss) per common
share:
$
0.32
$
0.11
$
1.06
$
(0.03
)
Diluted net income (loss) per common
share:
$
0.31
$
0.11
$
1.05
$
(0.03
)
Weighted-average common shares:
Basic
84.4
84.1
84.4
84.1
Diluted
85.1
84.7
85.0
84.1
Hexcel Corporation and
Subsidiaries
Condensed Consolidated Balance
Sheets
Unaudited
September 30,
December 31,
(In millions)
2022
2021
Assets
Cash and cash equivalents
$
90.9
$
127.7
Accounts receivable, net
202.7
160.3
Inventories, net
303.1
245.7
Contract assets
32.9
30.5
Prepaid expenses and other current
assets
43.0
39.5
Assets held for sale
12.6
12.6
Total current assets
685.2
616.3
Property, plant and equipment
3,004.6
3,110.0
Less accumulated depreciation
(1,375.3
)
(1,363.9
)
Net property, plant and equipment
1,629.3
1,746.1
Goodwill and other intangible assets,
net
253.1
267.5
Investments in affiliated companies
47.0
44.6
Other assets
161.1
144.9
Total assets
$
2,775.7
$
2,819.4
Liabilities and Stockholders'
Equity
Liabilities:
Short-term borrowings
$
0.3
$
0.9
Accounts payable
113.2
113.2
Accrued compensation and benefits
69.4
54.4
Accrued liabilities
100.8
79.1
Total current liabilities
283.7
247.6
Long-term debt
797.0
822.4
Retirement obligations
47.4
52.6
Other non-current liabilities
202.6
211.3
Total liabilities
$
1,330.7
$
1,333.9
Stockholders' equity:
Common stock, $0.01 par value, 200.0
shares authorized, 110.3 shares issued at September 30, 2022 and
110.1 shares issued at December 31, 2021
$
1.1
$
1.1
Additional paid-in capital
898.9
878.6
Retained earnings
2,076.4
2,012.5
Accumulated other comprehensive loss
(249.1
)
(126.5
)
2,727.3
2,765.7
Less – Treasury stock, at cost, 26.2
shares at September 30, 2022 and 26.1 shares at December 31,
2021
(1,282.3
)
(1,280.2
)
Total stockholders' equity
1,445.0
1,485.5
Total liabilities and stockholders'
equity
$
2,775.7
$
2,819.4
Hexcel Corporation and
Subsidiaries
Condensed Consolidated Statements of
Cash Flows
Unaudited
Nine Months Ended
September 30,
(In millions)
2022
2021
Cash flows from operating
activities
Net income (loss)
$
89.3
$
(2.8
)
Reconciliation to net cash used for
operating activities:
Depreciation and amortization
94.9
102.4
Amortization related to financing
0.6
2.7
Deferred income taxes
(8.5
)
(3.2
)
Equity in (earnings) losses from
affiliated companies
(5.5
)
0.9
Stock-based compensation
15.2
16.2
Merger and restructuring expenses, net of
payments
(6.1
)
(4.4
)
Gain on sale of assets
(19.4
)
-
Gain on sale of investments
(0.3
)
-
Changes in assets and liabilities:
Increase in accounts receivable
(53.1
)
(55.6
)
Increase in inventories
(82.0
)
(37.3
)
(Increase) decrease in prepaid expenses
and other current assets
(11.6
)
3.6
Increase in accounts payable/accrued
liabilities
31.7
43.3
Other - net
11.2
(1.6
)
Net cash provided by operating activities
(a)
56.4
64.2
Cash flows from investing
activities
Capital expenditures (b)
(58.3
)
(15.0
)
Proceeds from sale of assets
21.2
-
Proceeds from sale of investments
0.5
-
Net cash used for investing activities
(36.6
)
(15.0
)
Cash flows from financing
activities
Borrowings from senior unsecured credit
facilities
35.0
-
Repayments of senior unsecured credit
facilities
(61.0
)
(49.0
)
Repayment of finance lease obligation and
other debt, net
(0.4
)
(0.7
)
Dividends paid
(25.3
)
-
Activity under stock plans
3.1
4.9
Net cash used for financing activities
(48.6
)
(44.8
)
Effect of exchange rate changes on cash
and cash equivalents
(8.0
)
(1.9
)
Net (decrease) increase in cash and cash
equivalents
(36.8
)
2.5
Cash and cash equivalents at beginning of
period
127.7
103.3
Cash and cash equivalents at end of
period
$
90.9
$
105.8
Supplemental data:
Free Cash Flow (a)+(b)
$
(1.9
)
$
49.2
Accrual basis additions to property, plant
and equipment
$
49.1
$
14.3
Hexcel Corporation and
Subsidiaries
Net Sales to Third-Party Customers by
Market
Quarters Ended September 30, 2022 and
2021
Unaudited
Table A
(In millions)
As Reported
Constant Currency (a)
B/(W)
FX
B/(W)
Market
2022
2021
%
Effect (b)
2021
%
Commercial Aerospace
$
209.1
$
167.2
25.1
$
(1.9
)
$
165.3
26.5
Space & Defense
108.6
110.4
(1.6
)
(2.0
)
108.4
0.2
Industrial
47.0
56.2
(16.4
)
(4.9
)
51.3
(8.4
)
Consolidated Total
$
364.7
$
333.8
9.3
$
(8.8
)
$
325.0
12.2
Consolidated % of Net Sales
%
%
%
Commercial Aerospace
57.3
50.1
50.8
Space & Defense
29.8
33.1
33.4
Industrial
12.9
16.8
15.8
Consolidated Total
100.0
100.0
100.0
Nine Months Ended September 30, 2022
and 2021
Unaudited
(In millions)
As Reported
Constant Currency (a)
B/(W)
FX
B/(W)
Market
2022
2021
%
Effect (b)
2021
%
Commercial Aerospace
$
655.6
$
468.5
39.9
$
(3.9
)
$
464.6
41.1
Space & Defense
338.7
329.0
2.9
(5.5
)
323.5
4.7
Industrial
154.0
166.9
(7.7
)
(11.3
)
155.6
(1.0
)
Consolidated Total
$
1,148.3
$
964.4
19.1
$
(20.7
)
$
943.7
21.7
Consolidated % of Net Sales
%
%
%
Commercial Aerospace
57.1
48.6
49.2
Space & Defense
29.5
34.1
34.3
Industrial
13.4
17.3
16.5
Consolidated Total
100.0
100.0
100.0
(a)
To assist in the analysis of the Company’s
net sales trend, total net sales and sales by market for the
quarter and nine months ended September 30, 2021 have been
estimated using the same U.S. dollar, British pound and Euro
exchange rates as applied for the respective periods in 2022 and
are referred to as “constant currency” sales.
(b)
FX effect is the estimated impact on “as
reported” net sales due to changes in foreign currency exchange
rates.
Hexcel Corporation and
Subsidiaries
Segment Information
Unaudited
Table B
(In millions)
Composite Materials
Engineered Products
Corporate & Other
(a)
Total
Third Quarter 2022
Net sales to external customers
$
293.5
$
71.2
$
-
$
364.7
Intersegment sales
15.4
0.7
(16.1
)
-
Total sales
308.9
71.9
(16.1
)
364.7
Other operating expense
0.4
-
-
0.4
Operating income (loss)
41.4
6.0
(6.6
)
40.8
% Operating margin
13.4
%
8.3
%
11.2
%
Depreciation and amortization
27.5
3.5
-
31.0
Stock-based compensation expense
1.0
0.3
1.1
2.4
Accrual based additions to capital
expenditures
17.9
2.8
0.1
20.8
Third Quarter 2021
Net sales to external customers
$
254.1
$
79.7
$
-
$
333.8
Intersegment sales
15.0
0.4
(15.4
)
-
Total sales
269.1
80.1
(15.4
)
333.8
Other operating expense
0.8
-
-
0.8
Operating income (loss)
30.0
6.5
(13.7
)
22.8
% Operating margin
11.1
%
8.1
%
6.8
%
Depreciation and amortization
30.1
3.6
-
33.7
Stock-based compensation expense
0.7
0.1
2.1
2.9
Accrual based additions to capital
expenditures
3.7
2.8
-
6.5
First Nine Months 2022
Net sales to external customers
$
925.4
$
222.9
$
-
$
1,148.3
Intersegment sales
50.4
2.0
(52.4
)
-
Total sales
975.8
224.9
(52.4
)
1,148.3
Other operating expense (income)
1.6
0.1
(19.4
)
(17.7
)
Operating income (loss)
131.2
25.7
(22.2
)
134.7
% Operating margin
13.4
%
11.4
%
11.7
%
Depreciation and amortization
84.2
10.6
0.1
94.9
Stock-based compensation expense
4.5
1.3
9.4
15.2
Accrual based additions to capital
expenditures
42.5
6.5
0.1
49.1
First Nine Months 2021
Net sales to external customers
$
732.2
$
232.2
$
-
$
964.4
Intersegment sales
42.8
1.8
(44.6
)
-
Total sales
775.0
234.0
(44.6
)
964.4
Other operating expense
16.3
(0.5
)
0.2
16.0
Operating income (loss)
61.9
17.1
(50.2
)
28.8
% Operating margin
8.0
%
7.3
%
3.0
%
Depreciation and amortization
91.4
10.9
0.1
102.4
Stock-based compensation expense
2.1
0.4
13.7
16.2
Accrual based additions to capital
expenditures
10.7
3.6
-
14.3
(a) Hexcel does not allocate corporate expenses to the operating
segments.
Hexcel Corporation and
Subsidiaries
Reconciliation of GAAP to Non-GAAP
Operating Income, Net Income (Loss), EPS and Operating Cash Flow to
Free Cash Flow
Table C
Unaudited
Quarters Ended
Nine Months Ended
September 30,
September 30,
(In millions)
2022
2021
2022
2021
GAAP operating income
$
40.8
$
22.8
$
134.7
$
28.8
Other operating (income) expense (a)
0.4
0.8
(17.7
)
16.0
Non-GAAP operating income
$
41.2
$
23.6
$
117.0
$
44.8
Unaudited
Quarters Ended September 30,
2022
2021
(In millions, except per diluted share
data)
Net Income
EPS
Net Income
EPS
GAAP
$
26.8
$
0.31
$
9.0
$
0.11
Other operating expense, net of tax
(a)
0.3
-
0.7
-
Tax expense (b)
1.3
0.02
1.3
0.02
Non-GAAP
$
28.4
$
0.33
$
11.0
$
0.13
Unaudited
Nine Months Ended September
30,
2022
2021
(In millions, except per diluted share
data)
Net Income
EPS
Net Loss
EPS
GAAP
$
89.3
$
1.05
$
(2.8
)
$
(0.03
)
Other operating (income) expense, net of
tax (a)
(15.2
)
(0.19
)
11.7
0.14
Other income
(0.3
)
-
-
-
Tax expense (b)
1.3
0.02
0.8
-
Non-GAAP
$
75.1
$
0.88
$
9.7
$
0.11
Unaudited
Nine Months Ended September
30
(In millions)
2022
2021
Net cash used for operating activities
$
56.4
$
64.2
Less: Capital expenditures
(58.3
)
(15.0
)
Free cash flow (non-GAAP)
$
(1.9
)
$
49.2
(a)
The nine months ended September
30, 2022 included the net gain of $19.4 million from the sale of
the Dublin, California facility and both the quarter and nine
months ended September 30, 2022 included restructuring costs. The
quarter and nine months ended September 30, 2021 included
restructuring costs primarily related to severance.
(b)
The quarter and nine months ended
September 30, 2022 included a discrete tax charge of $1.3 million
resulting from the true-up of a deferred tax item. The quarter
ended September 30, 2021 included a discrete tax charge of $1.3
million related to the remeasurement of net U.S. state deferred tax
liabilities. The nine months ended September 30, 2021 included a
net discrete tax charge of $0.8 million primarily resulting from
the revaluation of U.S. and foreign deferred tax liabilities.
NOTE: Management believes that adjusted operating income
(loss), adjusted net income (loss), adjusted diluted net income
(loss) per share, the adjusted tax rate, and free cash flow, which
are non-GAAP measures, are meaningful to investors because they
provide a view of Hexcel with respect to the underlying operating
results excluding special items. Special items represent
significant charges or credits that are important to an
understanding of Hexcel’s overall operating results in the periods
presented. Non-GAAP measurements are not recognized in accordance
with generally accepted accounting principles and should not be
viewed as an alternative to GAAP measures of performance.
Hexcel Corporation and
Subsidiaries
Schedule of Total Debt, Net of
Cash
Table D
Unaudited
September 30,
December 31,
September 30,
(In millions)
2022
2021
2021
Current portion finance lease
$
0.3
$
0.9
$
0.9
Total current debt
0.3
0.9
0.9
Senior unsecured credit facility
99.0
125.0
179.0
4.7% senior notes due 2025
300.0
300.0
300.0
3.95% senior notes due 2027
400.0
400.0
400.0
Senior notes original issue discounts
(1.0
)
(1.2
)
(1.3
)
Senior notes deferred financing costs
(2.4
)
(2.9
)
(3.0
)
Other debt
1.4
1.5
1.7
Total long-term debt
797.0
822.4
876.4
Total Debt
797.3
823.3
877.3
Less: Cash and cash equivalents
(90.9
)
(127.7
)
(105.8
)
Total debt, net of cash
$
706.4
$
695.6
$
771.5
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221024005732/en/
Kurt Goddard | Vice President Investor Relations |
Kurt.Goddard@Hexcel.com | +1 (203)-352-6826
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