- Delivered 250 shipsets, compared to 206 in Q3 2020; delivered
47 737 shipsets in Q3 2021 compared to 15 in Q3 2020
- Revenue of $980 million in Q3 2021, compared to $806 million in
Q3 2020
- Cash guidance unchanged: full-year 2021 cash used in operations
is expected to be between $(50) to $(150) million; full-year 2021
free cash flow* is expected to be between $(200) and $(300)
million
- EPS of $(1.09) in Q3 2021 compared to $(1.50) in Q3 2020
- Established business divisions to focus on key growth markets:
Commercial, Defense & Space, and Aftermarket; Segment reporting
change beginning Q4 2021
Spirit AeroSystems Holdings, Inc. (NYSE: SPR) (“Spirit” or the
“Company”) reported third quarter 2021 financial results.
Table 1. Summary Financial Results (unaudited)
3rd Quarter
Nine Months
($ in millions, except per share data)
2021
2020
Change
2021
2020
Change
Revenues
$980
$806
22%
$2,883
$2,528
14%
Operating Loss
($157)
($177)
11%
($380)
($711)
47%
Operating Loss as a % of Revenues
(16.0%)
(21.9%)
590 BPS
(13.2%)
(28.1%)
**
Net Loss
($114)
($156)
27%
($421)
($574)
27%
Net Loss as a % of Revenues
(11.6%)
(19.3%)
**
(14.6%)
(22.7%)
810 BPS
Loss Per Share (Fully Diluted)
($1.09)
($1.50)
27%
($4.04)
($5.53)
27%
Adjusted Loss Per Share (Fully Diluted)*
($1.13)
($1.34)
16%
($2.59)
($4.45)
42%
Fully Diluted Weighted Avg Share Count
104.3
103.9
104.2
103.8
** Represents an amount equal to or in excess of 100% or not
meaningful.
“Despite the challenges over the past two years we have been
making a number of transformative changes. We maintained momentum
on our strategy to diversify and grow, which we believe will
position us to emerge stronger as the aviation industry recovers,”
said Tom Gentile, Spirit AeroSystems President and Chief Executive
Officer. “Given the changes in our business, we decided we were at
the right point to organize around three new business segments.
Beginning with the 2021 fiscal year-end, Spirit will report results
in the Commercial, Defense & Space and Aftermarket segments. In
line with these reporting segments, we also announced a new
organizational structure to focus on growth in these key
markets.”
“Although we have experienced some schedule changes and
execution challenges on certain programs, including the 787, we are
maintaining our cash guidance for the year of $(200) to $(300)
million.”
Revenue
Spirit’s third quarter of 2021 revenue was $980.0 million, up
22% from the same period of 2020, primarily due to higher
production deliveries on the Boeing 737 and increased revenue from
the recently acquired A220 wing and Bombardier programs. These
increases were partially offset by the lower widebody production
rates due to reduced international air traffic resulting from the
impacts of COVID-19. Deliveries increased to 250 shipsets during
the third quarter of 2021 compared to 206 shipsets in the same
period of 2020, including Boeing 737 deliveries of 47 shipsets
compared to 15 shipsets in the same period of the prior year.
Spirit’s backlog at the end of the third quarter of 2021 was
approximately $33 billion, with work packages on all commercial
platforms in the Boeing and Airbus backlog.
Earnings
Operating loss for the third quarter of 2021 was $156.6 million,
as compared to operating loss of $176.9 million in the same period
of 2020. The decreased loss was primarily driven by lower forward
loss charges and lower excess capacity costs in the third quarter
of 2021 compared to the third quarter of 2020. Third quarter 2021
earnings included $57.1 million of excess capacity costs and net
forward loss charges of $70.4 million, primarily driven by schedule
changes on the Airbus A350 program and reduced production demand on
the Boeing 787 program as previously described in the second
quarter 2021 Subsequent Event section. In comparison, during the
third quarter of 2020, Spirit recorded excess capacity costs of
$72.6 million and $128.4 million of net forward loss charges.
Additionally, during the third quarter of 2020, Spirit recognized
restructuring expenses of $19.5 million for cost-alignment and
headcount reductions.
Other income for the third quarter 2021 was $94.8 million,
compared to a net expense of $10.0 million for the same period in
the prior year. The increase is primarily driven by a curtailment
gain of $61 million recognized in the third quarter of 2021
resulting from the closure of the defined benefit plans acquired as
part of the Bombardier Acquisition.
Third quarter EPS was $(1.09), compared to $(1.50) in the same
period of 2020. Third quarter 2021 adjusted EPS* was $(1.13), which
excluded the incremental deferred tax asset valuation allowance and
the curtailment gain. During the same period of 2020, adjusted EPS*
was $(1.34), which excluded the impacts of planned acquisitions,
restructuring costs and the voluntary retirement program offered
during 2020. (Table 1)
Cash
Cash provided by operations in the third quarter of 2021
improved to $211 million, compared to $(53) million in the same
quarter last year, primarily due to the receipt of $228 million of
tax refund as a result of carrybacks permitted by the CARES Act,
$38 million resulting from the Aviation Manufacturing Jobs
Protection Program as well as positive impacts of working capital.
Free cash flow* in the third quarter of 2021 was $174 million as
compared to $(72) million in the same period of 2020. The cash
balance at the end of the third quarter of 2021 was $1.4 billion.
(Table 2)
Table 2. Cash Flow and Liquidity (unaudited)
3rd Quarter
Nine Months
($ in millions)
2021
2020
Change
2021
2020
Change
Cash provided by (used in) Operations
$211
($53)
**
$13
($613)
**
Purchases of Property, Plant & Equipment
($37)
($19)
91%
($90)
($70)
28%
Free Cash Flow*
$174
($72)
**
($77)
($683)
(89%)
September 30,
December 31,
Liquidity
2021
2020
Cash
$1,431
$1,873
Total Debt
$3,595
$3,874
** Represents an amount equal to or in excess of 100% or not
meaningful.
Financial Outlook and Risk to Future Financial Results –
Unchanged November 3, 2021
Full-year 2021 cash used in operations is expected to be between
$(50) and $(150) million; full-year 2021 free cash flow* is
expected to be between $(200) and $(300) million, consistent with
previously provided guidance.
Please refer to our Cautionary Statement Regarding
Forward-Looking Statements below and the section captioned “Risk
Factors” in the Company’s Annual Report on Form 10-K and the
Company’s Quarterly Reports on Form 10-Q.
* Non-GAAP financial measure, see Appendix for
reconciliation
Segment Results
Fuselage Systems
Fuselage Systems segment revenue in the third quarter of 2021
increased 14 percent from the same period last year to $481.2
million, primarily due to increased production volumes from the
Boeing 737 and recently acquired Bombardier programs, partially
offset by lower production volumes on the Boeing 777 and 787
programs. Operating margin for the third quarter of 2021 increased
to (11) percent, compared to (23) percent during the same period of
2020. This increase was primarily due to less net forward losses
recognized. In the third quarter of 2021, the Fuselage Systems
Segment includes restructuring expenses of $0.2 million and excess
capacity costs of $36.2 million, compared to restructuring expenses
of $6.6 million and excess capacity costs of $42.0 million during
the same period in 2020. In the third quarter of 2021, the segment
recorded pretax $1.6 million of unfavorable cumulative catch-up
adjustments and $49.9 million of net forward losses. In the third
quarter of 2020, the segment recorded pretax $8.8 million of
favorable cumulative catch-up adjustments and $92.0 million of net
forward losses.
Propulsion Systems
Propulsion Systems segment revenue in the third quarter of 2021
increased 45 percent from the same period last year to $247.8
million, primarily due to increased revenue from the Boeing 737
program and aftermarket sales, partially offset by decreased
production volume on the Boeing 777 and 787 programs. Operating
margin for the third quarter of 2021 increased to 9 percent,
compared to (9) percent during the same period of 2020, primarily
due to increased Boeing 737 production volumes and the resulting
decrease in excess capacity costs. In the third quarter of 2021,
the segment recorded excess capacity costs of $10.8 million,
compared to excess capacity costs of $17.5 million and $3.8 million
of restructuring expenses in the third quarter of 2020. The segment
recorded pretax $1.6 million of favorable cumulative catch-up
adjustments and $5.9 million of net forward losses in the third
quarter of 2021. In comparison, during the same period of the prior
year, the segment recorded pretax $4.6 million of unfavorable
cumulative catch-up adjustments, and $14.9 million of net forward
losses.
Wing Systems
Wing Systems segment revenue in the third quarter of 2021
increased 44 percent from the same period last year to $243.0
million, primarily due to increased production deliveries on the
Boeing 737 and Airbus A220 programs, partially offset by decreased
production volume on the Boeing 787 program. Operating margin for
the third quarter of 2021 increased to (7) percent, compared to
(14) percent during the same period of 2020, primarily due to
increased Boeing 737 production volumes and the resulting decrease
in excess capacity costs, partially offset by higher costs on the
Airbus A320 program. In the third quarter of 2021, the segment
includes $0.6 million of restructuring costs and excess capacity
costs of $10.1 million, compared to the same period the prior year,
which included restructuring expenses of $9.1 million and excess
capacity costs of $13.1 million. In the third quarter of 2021, the
segment recorded pretax $2.9 million of unfavorable cumulative
catch-up adjustments and $14.6 million of net forward losses. In
the third quarter of 2020, the segment recorded pretax $0.4 million
of favorable cumulative catch-up adjustments and $21.5 million of
net forward losses.
Table 4. Segment Reporting (unaudited)
3rd Quarter
Nine Months
($ in millions)
2021
2020
Change
2021
2020
Change
Segment Revenues Fuselage Systems
$481.2
$421.1
14.3%
$1,410.5
$1,299.7
8.5%
Propulsion Systems
247.8
170.8
45.1%
716.2
565.6
26.6%
Wing Systems
243.0
168.3
44.4%
725.9
582.2
24.7%
All Other
8.0
46.1
(82.6%)
30.3
80.7
(62.5%)
Total Segment Revenues
$980.0
$806.3
21.5%
$2,882.9
$2,528.2
14.0%
Segment (Loss) Earnings from Operations Fuselage
Systems
($53.9)
($96.7)
44.3%
($145.5)
($434.6)
66.5%
Propulsion Systems
21.9
(15.6)
**
66.8
(38.2)
** Wing Systems
(15.8)
(23.2)
31.9%
(50.9)
(52.1)
2.3%
All Other
2.4
19.1
(87.4%)
5.1
28.9
(82.4%)
Total Segment Operating (Loss) Earnings
($45.4)
($116.4)
**
($124.5)
($496.0)
**
Unallocated Expense SG&A
($86.8)
($52.8)
(64.4%)
($211.3)
($179.2)
(17.9%)
Research & Development
(12.8)
(7.5)
(70.7%)
(34.3)
(28.1)
(22.1%)
Cost of Sales
(11.6)
(0.2)
**
(10.1)
(8.1)
**
Total (Loss) Earnings from Operations
($156.6)
($176.9)
11.5%
($380.2)
($711.4)
46.6%
Segment Operating (Loss) Earnings as % of Revenues
Fuselage Systems
(11.2%)
(23.0%)
**
(10.3%)
(33.4%)
** Propulsion Systems
8.8%
(9.1%)
**
9.3%
(6.8%)
** Wing Systems
(6.5%)
(13.8%)
730 BPS
(7.0%)
(8.9%)
190 BPS All Other
** ** **
** ** **
Total Segment Operating (Loss) Earnings as % of Revenues
(4.6%)
(14.4%)
980 BPS
(4.3%)
(19.6%)
**
Total Operating (Loss) Earnings as % of Revenues
(16.0%)
(21.9%)
590 BPS
(13.2%)
(28.1%)
** ** Represents an amount equal to or in excess of 100% or
not meaningful.
Cautionary Statement Regarding
Forward-Looking Statements
This press release contains “forward-looking statements” that
may involve many risks and uncertainties. Forward-looking
statements generally can be identified by the use of
forward-looking terminology such as “aim,” “anticipate,” “believe,”
“could,” “continue,” “estimate,” “expect,” “goal,” “forecast,”
“intend,” “may,” “might,” “model,” “objective,” “outlook,” “plan,”
“potential,” “predict,” “project,” “seek,” “should,” “target,”
“will,” “would,” and other similar words, or phrases, or the
negative thereof, unless the context requires otherwise. These
statements are based on circumstances as of the date on which the
statements are made and they reflect management’s current views
with respect to future events and are subject to risks and
uncertainties, both known and unknown. Our actual results may vary
materially from those anticipated in forward-looking statements. We
caution investors not to place undue reliance on any
forward-looking statements.
Important factors that could cause actual results to differ
materially from those reflected in such forward-looking statements
and that should be considered in evaluating our outlook include,
but are not limited to, the following:
- any negative developments related to the COVID-19 pandemic,
including, for example, with respect to (i) the duration, spread,
severity, or any recurrence of the COVID-19 pandemic; (ii) any new
variant strains of the underlying virus; (iii) the effectiveness,
availability, and usage of vaccines; (iv) the duration and scope of
governmental orders and restrictions related to COVID-19 on trade
and transport restrictions; (v) the extent of the impact of
COVID-19 on the global aerospace supply chain and the overall
demand for our and our customers’ products and services; (vi) the
impact of COVID-19 on our ability to retain the skilled work force
necessary for production and development, including from
governmental policies related thereto such as the mandatory
vaccination executive order applicable to federal contractors; and
(vii) the impact of COVID-19 on our access to capital;
- demand for our products and services and the general effect of
economic or geopolitical conditions, or other events, such as
pandemics, in the industries and markets in which we operate in the
U.S. and globally;
- the timing and conditions surrounding the full worldwide return
to service (including receiving the remaining regulatory approvals)
of the B737 MAX, future demand for the aircraft, and any residual
impacts of the B737 MAX grounding on production rates for the
aircraft;
- our reliance on Boeing and Airbus for a significant portion of
our revenues;
- our ability to successfully negotiate, or re-negotiate, future
pricing under our supply agreements with Boeing, Airbus and other
customers;
- the business condition and liquidity of our customers and their
ability to satisfy their contractual obligations to the
Company;
- the certainty of our backlog, including the ability of
customers to cancel or delay orders prior to shipment;
- our ability to accurately estimate and manage performance,
cost, margins, and revenue under our contracts, and the potential
for additional forward losses on new and maturing programs;
- our accounting estimates for revenue and costs for our
contracts and potential changes to those estimates;
- our ability to continue to grow and diversify our business,
execute our growth strategy, and secure replacement programs,
including our ability to enter into profitable supply arrangements
with additional customers;
- the outcome of non-conformance, product warranty, defective
product, or similar claims and the impact settlement of such claims
may have on our accounting assumptions;
- our dependence on our suppliers, as well as the cost and
availability of raw materials and purchased components;
- our ability and our suppliers’ ability to meet stringent
delivery (including quality and timeliness) standards and
accommodate changes in the build rates of aircraft;
- our ability to maintain continuing, uninterrupted production at
our manufacturing facilities and our suppliers’ facilities;
- competitive conditions in the markets in which we operate,
including in-sourcing by commercial aerospace original equipment
manufacturers;
- our ability to effectively integrate the acquisition of select
assets of Bombardier along with other acquisitions that we pursue,
and generate synergies and other cost savings therefrom, while
avoiding unexpected costs, charges, expenses, and adverse changes
to business relationships and business disruptions;
- the possibility that our cash flows may not be adequate for our
additional capital needs;
- any reduction in our credit ratings;
- our ability to access the capital markets to fund our liquidity
needs, and the costs and terms of any additional financing;
- our ability to avoid or recover from cyber or other security
attacks and other operations disruptions;
- legislative or regulatory actions, both domestic and foreign,
impacting our plans, strategies, financial results, and operations,
including the effect of changes in tax laws and rates and our
ability to accurately calculate and estimate the effect of such
changes;
- our ability to recruit and retain a critical mass of highly
skilled employees;
- our relationships with the unions representing many of our
employees, including our ability to avoid labor disputes and work
stoppages with respect to our union employees;
- spending by the U.S. and other governments on defense;
- pension plan assumptions and future contributions;
- the effectiveness of our internal control over financial
reporting;
- the outcome or impact of ongoing or future litigation,
arbitration, claims, and regulatory actions or investigations,
including our exposure to potential product liability and warranty
claims;
- adequacy of our insurance coverage;
- our ability to continue selling certain receivables through our
supplier financing programs; and
- the risks of doing business internationally, including
fluctuations in foreign currency exchange rates, impositions of
tariffs or embargoes, trade restrictions, compliance with foreign
laws, and domestic and foreign government policies.
These factors are not exhaustive and it is not possible for us
to predict all factors that could cause actual results to differ
materially from those reflected in our forward-looking statements.
These factors speak only as of the date hereof, and new factors may
emerge or changes to the foregoing factors may occur that could
impact our business. As with any projection or forecast, these
statements are inherently susceptible to uncertainty and changes in
circumstances. Except to the extent required by law, we undertake
no obligation to, and expressly disclaim any obligation to,
publicly update or revise any forward-looking statements, whether
as a result of new information, future events, or otherwise. You
should review carefully the section captioned “Risk Factors” in the
Company’s Annual Report on Form 10-K and the Company’s Quarterly
Reports on Form 10-Q for a more complete discussion of these and
other factors that may affect our business.
Spirit Shipset Deliveries (one shipset equals one
aircraft) 3rd Quarter Nine Months
2021
2020
2021
2020
B737
47
15
111
52
B747
1
1
4
4
B767
8
9
27
20
B777
7
14
18
30
B787
5
30
31
92
Total Boeing
68
69
191
198
A220
12
9
39
32
A320 Family
105
108
331
365
A330
6
4
15
17
A350
9
12
32
51
Total Airbus
132
133
417
465
Business/Regional Jet (1)
50
4
139
(2)
26
Total
250
206
747
689
(1) Beginning in the fourth quarter of 2020, includes
Business/Regional Jet deliveriesrelated to the Bombardier
acquisition (2) Incorporates changes resulting from alignment of
shipset reporting from acquiredsites. Q1 and Q2 2021 QTD deliveries
are 43 and 46, respectively.
Spirit AeroSystems Holdings,
Inc. Condensed Consolidated Statements of Operations
(unaudited) For the Three
Months Ended For the Nine
Months Ended September 30, 2021 October 1,
2020 September 30, 2021 October 1, 2020 ($ in
millions, except per share data) Revenue
$980.0
$806.3
$2,882.9
$2,528.2
Operating costs and expenses: Cost of sales
1,036.2
903.4
3,009.4
2,941.0
Selling, general and administrative
86.8
52.8
211.3
179.2
Restructuring costs
0.8
19.5
8.1
68.4
Research and development
12.8
7.5
34.3
28.1
Loss on disposal of assets
-
-
-
22.9
Total operating costs and expenses
1,136.6
983.2
3,263.1
3,239.6
Operating loss
(156.6
)
(176.9
)
(380.2
)
(711.4
)
Interest expense and financing fee amortization
(58.8
)
(53.0
)
(177.7
)
(133.8
)
Other income (expense), net
94.8
(10.0
)
138.7
(65.4
)
Loss before income taxes and equity in net loss of affiliate
(120.6
)
(239.9
)
(419.2
)
(910.6
)
Income tax benefit
7.9
85.2
0.6
340.0
Loss before equity in net loss of affiliate
(112.7
)
(154.7
)
(418.6
)
(570.6
)
Equity in net loss of affiliate
(0.9
)
(0.8
)
(1.9
)
(3.8
)
Net loss
($113.6
)
($155.5
)
($420.5
)
($574.4
)
Loss per share Basic
($1.09
)
($1.50
)
($4.04
)
($5.53
)
Shares
104.3
103.9
104.2
103.8
Diluted
($1.09
)
($1.50
)
($4.04
)
($5.53
)
Shares
104.3
103.9
104.2
103.8
Dividends declared per common share
$0.01
$0.01
$0.03
$0.03
Spirit AeroSystems Holdings, Inc. Condensed Consolidated
Balance Sheets (unaudited) September 30, 2021
December 31, 2020 ($ in millions) Assets Cash
and cash equivalents
$1,430.6
$1,873.3
Restricted cash
0.3
0.3
Accounts receivable, net
527.6
484.4
Contract assets, short-term
411.0
368.4
Inventory, net
1,325.7
1,422.3
Other current assets
121.1
336.3
Total current assets
3,816.3
4,485.0
Property, plant and equipment, net
2,406.9
2,503.8
Intangible assets, net
216.2
215.2
Goodwill
623.6
565.3
Right of use assets
87.2
70.6
Contract assets, long-term
-
4.4
Pension assets
487.2
455.9
Deferred income taxes
-
0.1
Other assets
103.4
83.6
Total assets
$7,740.8
$8,383.9
Liabilities Accounts payable
$644.8
$558.9
Accrued expenses
415.6
365.6
Profit sharing
39.8
57.0
Current portion of long-term debt
47.8
340.7
Operating lease liabilities, short-term
8.3
5.5
Advance payments, short-term
116.0
18.9
Contract liabilities, short-term
109.9
97.6
Forward loss provision, short-term
284.0
184.6
Deferred revenue and other deferred credits, short-term
95.9
22.2
Other current liabilities
88.4
58.4
Total current liabilities
1,850.5
1,709.4
Long-term debt
3,546.7
3,532.9
Operating lease liabilities, long-term
80.5
66.6
Advance payments, long-term
221.7
327.4
Pension/OPEB obligation
335.6
440.2
Contract liabilities, long-term
279.7
372.0
Forward loss provision, long-term
491.6
561.4
Deferred revenue and other deferred credits, long-term
34.8
38.9
Deferred grant income liability - non-current
26.7
28.1
Deferred income taxes
26.0
13.0
Other non-current liabilities
422.2
437.0
Stockholders' Equity Common stock, Class A par value $0.01,
200,000,000 shares authorized, 105,048,226 and 105,542,162 shares
issued and outstanding, respectively
1.1
1.1
Additional paid-in capital
1,140.4
1,139.8
Accumulated other comprehensive loss
(163.3)
(154.1)
Retained earnings
1,902.8
2,326.4
Treasury stock, at cost (41,523,470 shares each period,
respectively)
(2,456.7)
(2,456.7)
Total stockholders’ equity
424.3
856.5
Noncontrolling interest
0.5
0.5
Total equity
424.8
857.0
Total liabilities and equity
$7,740.8
$8,383.9
Spirit AeroSystems Holdings, Inc. Condensed Consolidated
Statements of Cash Flows (unaudited)
For the Nine Months Ended
September 30, 2021 October 1, 2020 ($ in
millions) Operating activities Net loss
($420.5
)
($574.4
)
Adjustments to reconcile net loss to net cash provided by (used in)
operating activities Depreciation and amortization expense
241.9
202.5
Amortization of deferred financing fees
6.4
12.6
Accretion of customer supply agreement
1.6
1.6
Employee stock compensation expense
19.6
17.1
Gain from derivative instruments
(0.1
)
-
Gain from foreign currency transactions
(7.3
)
(1.1
)
Loss on disposition of assets
2.3
24.9
Deferred taxes
13.5
(34.3
)
Pension and other post-retirement benefits, net
(104.5
)
57.2
Grant liability amortization
(1.2
)
(3.2
)
Equity in net loss of affiliates
1.9
3.8
Forward loss provision
(1.1
)
226.3
Changes in assets and liabilities Accounts receivable, net
(4.7
)
169.3
Contract assets
(38.8
)
200.4
Inventory, net
83.4
(66.1
)
Accounts payable and accrued liabilities
99.4
(530.6
)
Profit sharing/deferred compensation
(17.7
)
(46.2
)
Advance payments
(1.2
)
(19.9
)
Income taxes receivable/payable
227.2
(252.6
)
Contract liabilities
(79.8
)
(44.1
)
Other
(7.0
)
44.0
Net cash provided by (used in) operating activities
$13.3
($612.8
)
Investing activities Purchase of property, plant and
equipment
(90.0
)
(70.4
)
Acquisition, net of cash acquired
(21.1
)
(117.9
)
Other
4.7
4.9
Net cash used in investing activities
($106.4
)
($183.4
)
Financing activities Proceeds from issuance of debt
-
1,200.0
Payment on revolving credit facility
-
(800.0
)
Customer financing
(7.5
)
10.0
Principal payments of debt
(30.1
)
(22.7
)
Payments on term loan
(3.0
)
(439.7
)
Payments on floating rate notes
(300.0
)
-
Taxes paid related to net share settlement awards
(5.0
)
(14.0
)
Proceeds from issuance of ESPP stock
3.0
2.6
Debt issuance and financing costs
-
(27.6
)
Purchase of treasury stock
-
0.1
Dividends paid
(3.2
)
(14.4
)
Other
-
0.1
Net cash used in financing activities
($345.8
)
($105.6
)
Effect of exchange rate changes on cash and cash equivalents
(3.8
)
(3.3
)
Net decrease in cash, cash equivalents and restricted cash for
the period
($442.7
)
($905.1
)
Cash, cash equivalents, and restricted cash, beginning of the
period
1,893.1
2,367.2
Cash, cash equivalents, and restricted cash, end of the period
$1,450.4
$1,462.1
Reconciliation of Cash and Cash
Equivalents and Restricted Cash: September 30,
2021 October 1, 2020 Cash and cash equivalents,
beginning of the period
$1,873.3
$2,350.5
Restricted cash, short-term, beginning of the period
0.3
0.3
Restricted cash, long-term, beginning of the period
19.5
16.4
Cash, cash equivalents, and restricted cash, beginning of the
period
$1,893.1
$2,367.2
Cash and cash equivalents, end of the period
$1,430.6
$1,441.3
Restricted cash, short-term, end of the period
$0.3
$1.3
Restricted cash, long-term, end of the period
19.5
19.5
Cash, cash equivalents, and restricted cash, end of the period
$1,450.4
$1,462.1
Appendix
In addition to reporting our financial information using U.S.
Generally Accepted Accounting Principles (GAAP), management
believes that certain non-GAAP measures (which are indicated by *
in this report) provide investors with important perspectives into
the company’s ongoing business performance. The non-GAAP measures
we use in this report are (i) adjusted diluted earnings per share
and (ii) free cash flow, which are described further below. The
company does not intend for the information to be considered in
isolation or as a substitute for the related GAAP measures. Other
companies may define and calculate the measures differently than we
do, limiting the usefulness of the measures for comparison with
other companies.
Adjusted Diluted (Loss) Earnings Per Share. To provide
additional transparency, we have disclosed non-GAAP adjusted
diluted (loss) earnings per share (Adjusted EPS). This metric
excludes various items that are not considered to be directly
related to our operating performance. Management uses Adjusted EPS
as a measure of business performance and we believe this
information is useful in providing period-to-period comparisons of
our results. The most comparable GAAP measure is diluted earnings
per share.
Free Cash Flow. Free Cash Flow is defined as GAAP cash from
operating activities (generally referred to herein as “cash
provided by (used in) operations”), less capital expenditures for
property, plant and equipment. Management believes Free Cash Flow
provides investors with an important perspective on the cash
available for stockholders, debt repayments including capital
leases, and acquisitions after making the capital investments
required to support ongoing business operations and long term value
creation. Free Cash Flow does not represent the residual cash flow
available for discretionary expenditures as it excludes certain
mandatory expenditures. The most comparable GAAP measure is cash
provided by operating activities. Management uses Free Cash Flow as
a measure to assess both business performance and overall
liquidity.
The tables below provide reconciliations between the GAAP and
non-GAAP measures.
Adjusted EPS
Three months
ended Nine months ended
September 30, 2021 October 1, 2020
September 30, 2021 October 1, 2020
GAAP Diluted Loss
Per Share
($1.09)
($1.50)
($4.04)
($5.53)
Costs Related to Acquisitions
-
0.02
a
0.01
a
0.15
a Restructuring Costs
-
0.12
b
0.05
b
0.41
b Voluntary Retirement Program
-
0.02
c
-
0.52
c Deferred Tax Asset Valuation Allowance
0.34
d
-
1.72
d
-
Curtailment
(0.38)
e
-
(0.33)
e
-
Adjusted Diluted Loss Per Share
($1.13)
($1.34)
($2.59)
($4.45)
Diluted Shares (in millions)
104.3
103.9
104.2
103.8
a Represents the transaction costs (included in
SG&A)
b Represents
the restructuring expenses for cost-alignment and headcount
reductions (included in Restructuring costs)
c Represents the retirement incentive expenses
resulting from the VRP offered during 2020 (included in Other
income)
d Represents the deferred tax
asset valuation allowance (included in Income tax benefit)
e Represents the curtailment gain resulting from the
closure of the defined benefit plans acquired as part of the
Bombardier Acquisition (included in Other
income)
Free Cash Flow ($ in millions)
Three months ended Nine months ended Guidance
September 30 , 2021 October 1, 2020
September 30 , 2021 October 1, 2020 Full-Year 2021
Cash Provided by (Used
in) Operations
$211
($53)
$13
($613)
($50) - ($150)
Capital Expenditures
(37)
(19)
(90)
(70)
(150)
Free Cash Flow
$174
($72)
($77)
($683)
($200 - $300)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211103005395/en/
Investor Relations: Ryan Avey or Aaron Hunt (316) 523-7040
Media: Molly Edwards (316) 523-2479 On the web: http:/
/www.spiritaero.com
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