- Revenue of $1.3 billion, up 26% y/y
- EPS of $(1.17); Adjusted EPS* of $(1.21)
- Cash used in operations of $62 million; Free cash flow* usage
of $79 million
Spirit AeroSystems Holdings, Inc. (NYSE: SPR) (“Spirit” or the
“Company”) reported second quarter 2022 financial results.
Table 1. Summary Financial Results (unaudited) 2nd
Quarter Six Months ($ in millions, except per share
data)
2022
2021
Change
2022
2021
Change Revenues
$1,258
$1,002
26%
$2,433
$1,903
28%
Operating Loss
($105)
($98)
(7%)
($147)
($224)
34%
Operating Loss as a % of
Revenues
(8.3%)
(9.7%)
140 BPS
(6.0%)
(11.8%)
580 BPS
Net Loss
($122)
($135)
10%
($175)
($307)
43%
Net Loss as a % of Revenues
(9.7%)
(13.5%)
380 BPS
(7.2%)
(16.1%)
890 BPS
Loss Per Share (Fully Diluted)
($1.17)
($1.30)
10%
($1.67)
($2.95)
43%
Adjusted Earnings (Loss) Per Share (Fully Diluted)*
($1.21)
($0.31)
**
($1.19)
($1.51)
21%
Fully Diluted Weighted Avg Share Count
104.6
104.2
104.5
104.2
** Represents an amount in excess of 100% or not meaningful.
“Like many other companies, this past quarter we experienced
challenges with supply chain, staffing and inflation, as well as
schedule changes from our customers, all of which put pressure on
profitability,” said Tom Gentile, Spirit’s President and Chief
Executive Officer.
“We remain focused on executing in our factories and meeting the
commitments to our customers. Demand for aircraft remains robust
but the expected slower increase in production rates should give us
more time to stabilize the production system.”
Revenue
Spirit’s revenue in the second quarter of 2022 was $1.3 billion,
up 26 percent from the same period of 2021. This increase was
primarily due to higher production deliveries on the Boeing 737
program as well as increased Aftermarket revenue, partially offset
by lower production volume on the Boeing 787 program. Overall
deliveries increased to 318 shipsets during the second quarter of
2022 compared to 235 shipsets in the same period of 2021. This
includes Boeing 737 deliveries of 71 shipsets compared to 35
shipsets in the same period of the prior year and Boeing 787
deliveries of 4 shipsets compared to 11 shipsets in the second
quarter of 2021.
Spirit’s backlog at the end of the second quarter of 2022 was
approximately $34 billion, with work packages on all commercial
platforms in the Airbus and Boeing backlog.
Earnings
Operating loss for the second quarter of 2022 was $104.7
million, compared to operating loss of $97.7 million in the same
period of 2021. This increase in operating loss was primarily
driven by higher changes in estimates and losses related to Russia
sanctions recorded during the second quarter of 2022, partially
offset by higher production on the Boeing 737 program. Second
quarter 2022 earnings included net forward loss charges of $63.7
million and unfavorable cumulative catch-up adjustments of $8.0
million. The forward losses relate primarily to the Boeing 787 and
Airbus A220 programs. The forward loss on the Boeing 787 program is
driven by the impact of production rate decreases and increased
supply chain and other costs. The Airbus A220 program forward loss
is associated with the bankruptcy of a supplier and costs to
relocate the work. The unfavorable cumulative catch-up adjustments
were primarily driven by schedule changes, parts shortages and
increased estimates for supply chain, freight and other costs on
the Boeing 737 and Airbus A320 programs. In relation to the
sanctioned Russian business activities, Spirit recorded losses of
$41.9 million as well as the reversal of a previously booked
forward loss reserve of $13.8 million. Excess capacity costs
recorded during the second quarter of 2022 were $44.9 million. In
comparison, during the second quarter of 2021, Spirit recorded
$52.2 million of net forward loss charges, favorable cumulative
catch-up adjustments of $9.9 million, and excess capacity costs of
$47.5 million.
Other income for the second quarter of 2022 was $34.6 million,
compared to $31.1 million for the same period of 2021. The increase
was primarily due to a gain of $20.7 million related to the
settlement of the repayable investment agreement with the U.K.
Department of Business, Energy and Industrial Strategy and higher
foreign currency gains, partially offset by lower pension income,
higher excise tax and losses on foreign currency forward contracts
recognized during the second quarter of 2022.
Second quarter 2022 EPS was $(1.17), compared to $(1.30) in the
same period of 2021. Second quarter 2022 adjusted EPS* was $(1.21),
excluding the incremental deferred tax asset valuation allowance,
settlement gain and losses related to Russia sanctions. During the
same period of 2021, adjusted EPS* was $(0.31), which excluded
restructuring costs and the incremental deferred tax asset
valuation allowance. The decrease in adjusted EPS was primarily due
to a discrete tax benefit in the second quarter of 2021 related to
the change in U.K. corporate tax rates, as well as the required
quarterly estimation of taxes in both years. (Table 1)
Cash
Cash used in operations in the second quarter of 2022 was $62
million, compared to $28 million of cash used in operations in the
same quarter last year. This larger usage was primarily due to
higher working capital resulting from increased production
activities, the quarterly cash repayment of $31 million related to
the Boeing 737 advance received in 2019 and the interest payment
associated with the settlement of the repayable investment
agreement. Additionally, during the second quarter of 2022, Spirit
received the remaining balance of $24 million of the Aviation
Manufacturing Jobs Protection (AMJP) program grant awarded in 2021
and $27 million of pension-related cash benefits, net of excise
tax. Free cash flow* in the second quarter was a usage of $79
million, as compared to a free cash flow* usage of $53 million in
the same period of 2021.
In April 2022, the Company settled the repayable investment
agreement with the U.K. Department of Business, Energy and
Industrial Strategy for a payment of $293 million. The payment is
comprised of principal of $279 million and interest expense of $14
million, which are included in cash used in financing activities
and cash used in operations, respectively.
The cash balance at the end of the second quarter of 2022 was
$770 million. (Table 2)
Table 2. Cash Flow, Cash and Total Debt (unaudited) 2nd
Quarter Six Months ($ in millions)
2022
2021
Change
2022
2021
Change Cash used in Operations
($62)
($28)
**
($332)
($198)
68%
Purchases of Property, Plant & Equipment
($18)
($26)
(32%)
($45)
($53)
(15%)
Free Cash Flow*
($79)
($53)
48%
($377)
($251)
50%
June 30, December 31, Cash and Total
Debt
2022
2021
Cash
$770
$1,479
Total Debt
$3,773
$3,792
** Represents an amount in excess of 100% or not meaningful.
Segment Results
Commercial
Commercial segment revenue in the second quarter of 2022
increased 28 percent from the same period of the prior year to $1.0
billion, primarily due to increased production revenues on the
Boeing 737, 777 and Airbus A220 programs, partially offset by lower
production volumes on the Boeing 787 and 747 programs. Operating
margin for the second quarter of 2022 increased to (4) percent,
compared to (6) percent during the same period of 2021. This
improvement was primarily due to higher volumes on the Boeing 737
program and lower costs related to excess capacity and
restructuring, partially offset by higher changes in estimates and
losses related to Russia sanctions. In the second quarter of 2022,
the segment recorded $59.4 million of net forward losses and $7.9
million of unfavorable cumulative catch-up adjustments. In relation
to the sanctioned Russian business activities, the segment recorded
losses of $37.7 million as well as the reversal of a previously
booked forward loss reserve of $13.8 million. Additionally, during
the second quarter of 2022, the Commercial segment included excess
capacity costs of $43.1 million. In comparison, during the second
quarter of 2021, the segment recognized $51.2 million of net
forward losses, $10.5 million of favorable cumulative catch-up
adjustments, excess capacity costs of $45.5 million and
restructuring costs of $4.9 million.
Defense & Space
Defense & Space segment revenue in the second quarter of
2022 increased 3 percent from the same period of the prior year to
$146.4 million, primarily due to increased production volumes on
the Boeing P-8 program and higher development activity. Operating
margin for the second quarter of 2022 was flat compared to the same
period of 2021. The segment recorded excess capacity costs of $1.8
million and net forward losses of $4.3 million in the second
quarter of 2022, compared to excess capacity costs of $2.0 million
and net forward losses of $1.0 million in the second quarter of
2021.
Aftermarket
Aftermarket segment revenue in the second quarter of 2022
increased 42 percent from the same period of 2021 to $80.4 million,
primarily due to higher spare part sales and maintenance, repair
and overhaul (MRO) activity, compared to the same period in the
prior year. Operating margin for the second quarter of 2022
decreased to 15 percent, compared to 26 percent during the same
period of 2021, primarily due to losses of $4.2 million related to
Russia sanctions.
Table 4. Segment Reporting (unaudited)
2nd Quarter Six Months ($ in millions)
2022
2021
Change
2022
2021
Change
Segment Revenues
Commercial
$1,031.1
$803.6
28.3%
$1,969.5
$1,499.7
31.3%
Defense & Space
146.4
141.8
3.2%
304.9
295.2
3.3%
Aftermarket
80.4
56.7
41.8%
158.2
108.0
46.5%
Total Segment Revenues
$1,257.9
$1,002.1
25.5%
$2,432.6
$1,902.9
27.8%
Segment (Loss)
Earnings from Operations
Commercial
($45.1)
($44.7)
(0.9%)
($48.5)
($127.6)
62.0%
Defense & Space
13.7
12.4
10.5%
33.7
24.4
38.1%
Aftermarket
11.8
14.8
(20.3%)
29.8
25.6
16.4%
Total Segment Operating (Loss) Earnings
($19.6)
($17.5)
(12.0%)
$15.0
($77.6)
**
Segment Operating (Loss) Earnings as % of Revenues
Commercial
(4.4%)
(5.6%)
120 BPS
(2.5%)
(8.5%)
600 BPS Defense & Space
9.4%
8.7%
70 BPS
11.1%
8.3%
280 BPS Aftermarket
14.7%
26.1%
**
18.8%
23.7%
(490) BPS
Total Segment Operating (Loss) Earnings as % of Revenues
(1.6%)
(1.7%)
10 BPS
0.6%
(4.1%)
470 BPS
Unallocated Expense
SG&A
($70.2)
($66.9)
(4.9%)
($134.7)
($124.5)
(8.2%)
Research & Development
(14.9)
(13.3)
(12.0%)
(27.2)
(21.5)
(26.5%)
Total Loss from Operations
($104.7)
($97.7)
(7.2%)
($146.9)
($223.6)
34.3%
Total Operating
Loss as % of Revenues
(8.3%)
(9.7%)
140 BPS
(6.0%)
(11.8%)
580 BPS **
Represents an amount in excess of 100% or not meaningful.
* Non-GAAP financial measure, see Appendix for
reconciliation
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,” “forecast,” “goal,”
“intend,” “may,” “might,” “objective,” “plan,” “predict,”
“project,” “should,” “target,” “will,” “would,” and other similar
words, or phrases, or the negative thereof, unless the context
requires otherwise. These statements 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:
- the impact of the COVID-19 pandemic on our business and
operations, including on the demand for our and our customers’
products and services, on trade and transport restrictions, on the
global aerospace supply chain, on our ability to retain the skilled
work force necessary for production and development, and generally
on our ability to effectively manage the impacts of the COVID-19
pandemic on our business operations;
- demand for our products and services and the general effect of
economic or geopolitical conditions (including Russia’s invasion of
Ukraine and the resultant sanctions being imposed in response to
the conflict), 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 The Boeing Company (“Boeing”) and Airbus Group
SE and its affiliates (collectively, “Airbus”) for a significant
portion of our revenues;
- 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 on short
notice, and the potential impact of regulatory approvals of
existing and derivative models;
- 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 product warranty or defective product 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, including
increases in energy, freight, and other raw material costs as a
result of the sanctions being imposed in response to Russia’s
invasion of Ukraine;
- our ability and our suppliers’ ability to meet stringent
delivery (including quality and timeliness) standards and
accommodate changes in the build rates of aircraft, including the
ability to staff appropriately for anticipated production volume
increases;
- 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 successfully negotiate, or re-negotiate, future
pricing under our supply agreements with Boeing, Airbus and other
customers;
- 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 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 successfully negotiate new
agreements, and 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) 2nd Quarter Six Months
2022
2021
2022
2021
B737
71
35
131
64
B747
-
2
1
3
B767
8
9
16
19
B777
6
6
11
11
B787
4
11
7
26
Total Boeing
89
63
166
123
A220 (1)
16
15
34
27
A320 Family
147
96
302
226
A330
6
4
12
9
A350
11
11
26
23
Total Airbus
180
126
374
285
Business/Regional Jet (2)
49
46
99
89
Total
318
235
639
497
(1) Beginning in 2022, A220 deliveries reflect the number of wing
end item deliveries instead of pylon end item deliveries, as
previously reported. 2021 A220 deliveries have been updated to
reflect wing units. (2) 2021 Business/Regional Jet deliveries
incorporate changes resulting from alignment of shipset reporting
from acquired businesses.
Spirit AeroSystems Holdings, Inc.
Condensed Consolidated Statements of Operations
(unaudited) For the Three
Months Ended For the Six Months
Ended June 30, 2022 July 1, 2021 June
30, 2022 July 1, 2021 ($ in millions, except per
share data) Net revenues
$1,257.9
$1,002.1
$2,432.6
$1,902.9
Operating costs and expenses: Cost of sales
1,277.5
1,014.4
2,417.4
1,973.2
Selling, general and administrative
70.2
66.9
134.7
124.5
Restructuring costs
-
5.2
0.2
7.3
Research and development
14.9
13.3
27.2
21.5
Total operating costs and expenses
1,362.6
1,099.8
2,579.5
2,126.5
Operating loss
(104.7
)
(97.7
)
(146.9
)
(223.6
)
Interest expense and financing fee amortization
(55.1
)
(59.1
)
(114.0
)
(118.9
)
Other income, net
34.6
31.1
72.3
43.9
Loss before income taxes and equity in net loss of affiliate
(125.2
)
(125.7
)
(188.6
)
(298.6
)
Income tax benefit (expense)
3.5
(9.0
)
14.5
(7.3
)
Loss before equity in net loss of affiliate
(121.7
)
(134.7
)
(174.1
)
(305.9
)
Equity in net loss of affiliate
(0.5
)
(0.6
)
(0.9
)
(1.0
)
Net loss
($122.2
)
($135.3
)
($175.0
)
($306.9
)
Loss per share Basic
$ (1.17
)
($1.30
)
$ (1.67
)
($2.95
)
Shares
104.6
104.2
104.5
104.2
Diluted
$ (1.17
)
($1.30
)
$ (1.67
)
($2.95
)
Shares
104.6
104.2
104.5
104.2
Dividends declared per common share
$0.01
$0.01
$0.02
$0.02
Spirit AeroSystems Holdings, Inc. Condensed Consolidated
Balance Sheets (unaudited) June 30, 2022
December 31, 2021 ($ in millions) Assets Cash
and cash equivalents
$770.2
$1,478.6
Restricted cash
0.2
0.3
Accounts receivable, net
581.3
461.6
Contract assets, short-term
482.7
443.2
Inventory, net
1,345.8
1,382.6
Other current assets
31.4
39.7
Total current assets
3,211.6
3,806.0
Property, plant and equipment, net
2,260.9
2,385.5
Intangible assets, net
205.0
212.3
Goodwill
623.4
623.7
Right of use assets
82.3
85.3
Contract assets, long-term
0.9
-
Pension assets
432.1
532.5
Restricted plan assets
70.3
-
Deferred income taxes
3.5
0.4
Other assets
99.3
91.6
Total assets
$6,989.3
$7,737.3
Liabilities Accounts payable
$810.7
$720.3
Accrued expenses
390.3
376.1
Profit sharing
19.5
63.7
Current portion of long-term debt
347.7
49.5
Operating lease liabilities, short-term
8.3
8.2
Advance payments, short-term
98.2
137.8
Contract liabilities, short-term
84.2
97.9
Forward loss provision, short-term
309.2
244.6
Deferred revenue and other deferred credits, short-term
22.1
72.7
Other current liabilities
89.7
105.2
Total current liabilities
2,179.9
1,876.0
Long-term debt
3,424.8
3,742.7
Operating lease liabilities, long-term
73.2
78.8
Advance payments, long-term
194.1
201.3
Pension/OPEB obligation
32.5
74.8
Contract liabilities, long-term
276.2
289.1
Forward loss provision, long-term
402.5
521.6
Deferred revenue and other deferred credits, long-term
27.0
32.1
Deferred grant income liability - non-current
26.6
26.4
Deferred income taxes
9.5
21.8
Other non-current liabilities
117.1
423.9
Stockholders' Equity Common stock, Class A par value $0.01,
200,000,000 shares authorized, 105,138,159 and 105,037,845 shares
issued and outstanding, respectively
1.1
1.1
Additional paid-in capital
1,159.8
1,146.2
Accumulated other comprehensive loss
(83.0
)
(23.7
)
Retained earnings
1,604.2
1,781.4
Treasury stock, at cost (41,587,480 and 41,523,470 shares,
respectively)
(2,456.7
)
(2,456.7
)
Total stockholders’ equity
225.4
448.3
Noncontrolling interest
0.5
0.5
Total equity
225.9
448.8
Total liabilities and equity
$6,989.3
$7,737.3
Spirit AeroSystems Holdings, Inc. Condensed Consolidated
Statements of Cash Flows (unaudited)
For the Six Months Ended
June 30, 2022 July 1, 2021 ($ in millions)
Operating activities Net loss
($175.0
)
($306.9
)
Adjustments to reconcile net loss to net cash used in operating
activities Depreciation and amortization expense
169.0
160.3
Amortization of deferred financing fees
3.7
4.3
Accretion of customer supply agreement
1.3
1.1
Employee stock compensation expense
18.3
13.4
Loss (gain) from derivative instruments
4.0
(0.1
)
(Gain) loss from foreign currency transactions
(25.7
)
4.9
Loss on disposition of assets
1.6
1.4
Deferred taxes
(13.6
)
12.5
Pension and other post-retirement plans income
(39.7
)
(30.5
)
Grant liability amortization
(0.7
)
(0.8
)
Equity in net loss of affiliates
0.9
1.0
Forward loss provision
(53.4
)
(28.1
)
Gain on settlement of financial instrument
(21.0
)
-
Changes in assets and liabilities Accounts receivable, net
(124.7
)
(11.2
)
Contract assets
(44.5
)
14.4
Inventory, net
13.9
111.8
Accounts payable and accrued liabilities
105.5
(11.3
)
Profit sharing/deferred compensation
(43.7
)
(29.2
)
Advance payments
(65.7
)
(1.3
)
Income taxes receivable/payable
12.1
8.3
Contract liabilities
(26.5
)
(82.1
)
Pension plans employer contributions
23.0
(15.6
)
Deferred revenue and other deferred credits
(38.8
)
1.2
Other
(12.0
)
(15.2
)
Net cash used in operating activities
($331.7
)
($197.7
)
Investing activities Purchase of property, plant and
equipment
(45.2
)
(53.3
)
Acquisition, net of cash acquired
-
(21.1
)
Other
(2.2
)
2.2
Net cash used in investing activities
($47.4
)
($72.2
)
Financing activities Payment of principal - settlement of
financial instrument
(289.5
)
Customer financing
-
(5.0
)
Principal payments of debt
(22.5
)
(19.9
)
Payments on term loan
(3.0
)
(2.0
)
Payments on floating rate notes
-
(300.0
)
Taxes paid related to net share settlement awards
(6.5
)
(4.4
)
Proceeds from issuance of ESPP stock
1.9
1.4
Dividends paid
(2.2
)
(2.2
)
Other
-
0.1
Net cash used in financing activities
($321.8
)
($332.0
)
Effect of exchange rate changes on cash and cash equivalents
(7.6
)
(2.1
)
Net decrease in cash, cash equivalents and restricted cash for
the period
($708.5
)
($604.0
)
Cash, cash equivalents, and restricted cash, beginning of the
period
1,498.4
1,893.1
Cash, cash equivalents, and restricted cash, end of the period
$789.9
$1,289.1
Reconciliation of Cash and Cash
Equivalents and Restricted Cash: June 30, 2022
July 1, 2021 Cash and cash equivalents, beginning of the
period
$1,478.6
$1,873.3
Restricted cash, short-term, beginning of the period
0.3
0.3
Restricted cash, long-term, beginning of the period
19.5
19.5
Cash, cash equivalents, and restricted cash, beginning of the
period
$1,498.4
$1,893.1
Cash and cash equivalents, end of the period
$770.2
$1,269.3
Restricted cash, short-term, end of the period
0.2
0.3
Restricted cash, long-term, end of the period
19.5
19.5
Cash, cash equivalents, and restricted cash, end of the period
$789.9
$1,289.1
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 (loss) 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
(loss) per share.
Free Cash Flow. Free Cash Flow is defined as GAAP cash provided
by (used in) operating activities (also referred to herein as “cash
from 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
(used in) 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 Six months
ended June 30, 2022 July 1, 2021
June 30, 2022 July 1, 2021
GAAP Diluted Loss Per Share
($1.17)
($1.30)
($1.67)
($2.95)
Costs Related to Acquisitions
-
-
-
0.01
a Restructuring Costs
-
0.01
b
-
0.04
b Deferred Tax Asset Valuation Allowance
(0.11)
c
0.98
c
0.43
c
1.39
c Settlement Gain
(0.18)
d
-
(0.13)
d
-
Losses related to Russia Sanctions
0.25
e
-
0.18
e
-
Adjusted Diluted Loss Per Share
($1.21)
($0.31)
($1.19)
($1.51)
Diluted Shares (in millions)
104.6
104.2
104.5
104.2
a
Represents the transaction costs (included in SG&A)
b
Represents the restructuring expenses for cost-alignment and
headcount reductions (included in Restructuring costs)
c
Represents the deferred tax asset valuation allowance (included in
Income tax benefit (expense))
d
Represents the settlement gain resulting from the settlement of the
repayable investment agreement with the U.K. Department of
Business, Energy and Industrial Strategy (included in Other income)
e
Represents the impairment charges and reserve adjustments related
to the suspension of all sales and service activities relating to
sanctioned Russian business activities. These losses are directly
attributable to the sanctions, incremental to similar costs (or
income) incurred for reasons other than the sanctions and are not
expected to recur, and therefore, are not indicative of Spirit's
ongoing operational performance.
Free Cash Flow ($ in
millions) Three months ended Six months ended June 30,
2022 July 1, 2021 June 30, 2022 July 1, 2021 Cash used in
Operations
($62)
($28)
($332)
($198)
Capital Expenditures
(18)
(26)
(45)
(53)
Free Cash Flow
($79)
($53)
($377)
($251)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220803005301/en/
Investor Relations: Ryan Avey or Aaron Hunt (316) 523-7040
Media: Chuck Cadena (316) 526-3910 or Haley Beattie +44 2895 680850
On the web: http://www.spiritaero.com
Spirit Aerosystems (NYSE:SPR)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
Spirit Aerosystems (NYSE:SPR)
Historical Stock Chart
Von Jul 2023 bis Jul 2024